Sharon Grants Egypt Military Rewards in Sinai, Is Outmaneuvered by a Secret UK-Egyptian-Palestinian Gas Transaction

In the middle of last week’s Gush Katif clashes between Israeli soldiers and anti-evacuation activists, a Hizballah commando raid on northern Israel and traffic blockages by more protesters, prime minister Ariel Sharon’s emissaries quietly wound up negotiations on a military protocol with Egypt. This protocol, under challenge now by Israeli lawmakers, formally provides for the deployment of 750 Egyptian border police along the southern Gaza Philadelphi border route to enable the withdrawal of Israeli troops and civilians from the Gaza Strip.
But, according to debkafile‘s military sources, the tacit part of the deal offers Cairo much more than a military foothold along this 14-km border strip. Against the recommendations of the Israeli high command and military intelligence AMAN, the Sharon government has agreed to Egypt’s deployment of commando troops, APCS equipped with night-vision equipment and helicopters along the entire border. Moreover, the Egyptian navy will be allowed to use the northern Sinai Mediterranean port of El Arish as a naval base for warships.
Likud Knesset Member Michael Eytan called the House into session Tuesday, July 5, to air the deal before it is finally signed. He acted on receipt of legal opinions confirming that even the limited Philadelphi route deal contravened the military clauses of the Egyptian-Israeli treaty which mandate the demilitarization of all parts of Sinai including the borders. If the deal goes through without parliamentary approval, a group of lawmakers stands ready to file High Court petitions to declare it invalid.
June 30, the day after Israeli and Egyptian officials agreed on the protocol, Israeli infrastructure minister Binyamin Ben Eliezer and Egyptian oil minister Sameh Fahmi added their signatures in Cairo to a $2.5bn agreement for the annual sale of 1.1 bn cubic meters of Egyptian natural gas to Israel in the next 15 years.
The gas will be pumped through a maritime pipeline to Israel’s Mediterranean port of Ashkelon. The deal was concluded between the Israel Electric Corp. and the Israeli-Egyptian consortium East Mediterranean Gas (Egyptian General Petrol Corporation and Yossi Meiman’s Merhav).
Sharon preferred the Egyptian gas offer to the bid made by the Palestinian Authority-British Gas on the grounds that any cash flow to the Palestinian would end up bankrolling terrorist operations against Israel.
debkafile‘s Middle East sources reveal that, when Ben Eliezer shook the hand of Fahmi in Cairo, he had no notion that Egypt and Britain had secretly struck a separate deal behind Israel’s back. It provided for British Gas and its Palestinian partners – through the Athens-based Consolidated Contractors Company – CCC – to resume drilling at the Gaza offshore field and sell the gas to Egypt over the same 15-year period as the contract with Israel. This contract stands to put $150-200m a year in Palestinian pockets.
Britain and Egypt will lay a marine pipeline from the gas fields to El Arish outside which the British have begun constructing a gas refinery at Sheik Al Zwayed. A small part of its output will be piped to the Gaza power station to replace the energy supplied by Israel’s electric corporation.
The Israel-Egyptian military protocol if signed will turn El Arish into a boom port, the harbor of the Egyptian fleet and site of a gas terminal for European tankers to transfer liquid gas outside the Middle East. Britain is sinking $150 m into its construction. The refined Palestinian gas left over from its domestic use, about 60%, will be siphoned into Egypt’s gas pipe system which is linked to Jordan and by the end of summer 2005 will reach Syria. Egyptian and Palestinian gas will both flow through this system and it is entirely possible that Israel will end up with Palestinian gas after all.
debkafile‘s Palestinian sources add: The head of the Palestinian Electricity Company Walid Sayel (son of the PLO military commander in Lebanon General Saad Sayel who was murdered by the Syrians in 1993) is handling the project for the Palestinians. He
Is also the go-between with the CCC, which runs the Palestinian Investment Fund.
This turn of events is at complete odds with the Ariel Sharon’s energy strategy.
His decision to buy Egyptian rather than Palestinian gas was influenced by the following security considerations:
1. If Israel rejected Palestinian gas, it would have no alternative buyers given the world’s glut of gas.
2. The Palestinians would thus be denied revenues that would obviously have been used to fuel armed action against Israel rather than Gaza’s reconstruction.
3. Egypt has a surfeit of gas. Sharon hoped the transaction with Israel would have deterred Cairo from helping the Palestinians develop their own field.
4. Israel feels betrayed by Britain and Egypt. Both had promised helpful partnership roles in support of Israel’s evacuation of the Gaza Strip and undertook to create a new, effective Palestinian security force to quell terrorist activity. (A British MI6 secret service war room has been set up in the Gaza Strip). Now both are instead acting in ways detrimental to Israel’s security interests.
Five months ago, at the London conference on Palestinian reforms organized by Tony Blair, US secretary of state Condoleezza Rice informed the Palestinian leader Mahmoud Abbas of the whereabouts of Yasser Arafat’ secret stash of money that had been donated for Palestinian development in the CCC from 1994. He used its capital profits to fund his terror war against Israel. Revealing this on March 20, debkafile reported that she had obtained a promise from Abbas to lay hands on the approximately $4 bn and spend the money on vital reforms of the Palestinian administration.
(To read this article, click HERE)
But Abbas did not kept his word to Rice to transfer Arafat’s illicit hoard to the Palestinian Authority, just as he reneged on his promise to fight terror. Israel was taken aback to discover that Walid Sayel is facilitating the Egyptian-British-Palestinian gas transaction under orders from the late Arafat’s financial adviser Mohammed Rashid, who also set up his late boss’s corrupt monopolies which oiled the Palestinian terror machine. Arafat’s death has changed little in the financial administration of the Palestinian Authority. And the back door for financing terrorists from such transactions as Palestinian gas exports to Egypt is wide open.

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