Israeli cabinet decides to move ahead with natural gas deal

The Israeli government on Sunday decided to move ahead with a deal with a U.S. energy conglomerate on development of the country's vital natural gas reserves, despite protests against the controversial deal.

The cabinet approved the transfer of Article 52 of the Antitrust Law from the hands of Economy Minister Arye Deri to those of the government, a move that still needs approval by the parliament.

Through this clause, an antitrust commissioner can be prevented from interfering in a "restrictive agreement" due to reasons of foreign policy or national security.

The smaller Israeli security cabinet authorized on Thursday an outline of the natural gas deal that allows the Texas-based Noble Energy group and the Israeli Delek group, both owned by Israeli tycoon Isaac Tshuva, to develop Israel's two offshore gas fields.

However, Economy Minister Aryeh Deri stalled the overall authorization of the deal as he refused to assume responsibilities of the anti-trust authority chief to approve the deal.

Anti-trust authority head David Gilo resigned a month ago, warning that the deal would "strengthen the monopoly over gas extractions in Israel."

Thousands of Israelis protested in Tel Aviv on Saturday against the upcoming agreement, charging that it increases the monopoly of the energy conglomerate and there is a lack of transparency in the decision-making process.

Natural gas was discovered several years ago off the coasts of Israel. The major gas fields of Leviathan and Tamar are both owned by Tshuva's companies.

"I am determined to advance a realistic solution that will bring gas to the Israeli economy," Netanyahu told the cabinet Sunday.

Insisting that the deal would encourage competition in the energy market, the prime minister vowed not to "capitulate to populist proposals" that he claims will "leave the gas deep underground."

"In the coming decades, it will put hundreds of billions of shekels into education, culture, health and many other things that would benefit Israeli citizens," he added. Endit