The First Post (UK), February 16, 2009 - Wherever there is oil and gas to be found in the early 21st century, warfare is never far away. And as the smoke clears from Israel’s blitz of the Gaza Strip, and Hamas and Israel move towards a ceasefire, it is tempting to speculate whether Gaza is another "resource war", as the British government's former scientific advisor David King candidly described the Iraq invasion this week.
When Israel disengaged from Gaza in 2005, the pro-Israel columnist Thomas Friedman declared that its population had the opportunity to become a "Dubai on the Mediterranean".
In 1999 BG found £2bn worth of gas reserves off the coast of Gaza
At the time this aspiration appeared unlikely in a densely populated strip of land with few natural resources, whose connections to the outside world were severely circumscribed by Israel’s continued control over its borders.
But Friedman's hypothesis was not quite as fantastic as it seemed. In 1999 the BG Group (the multinational arm of British Gas) discovered huge deposits of gas off the coast of Gaza. They were valued at £2 billion.
Some 60 per cent of these reserves were located within the maritime waters controlled by the Palestine National Authority (PNA), while the remainder fell under Israeli jurisdiction. In theory these deposits provided sufficient to meet the energy requirements of Gaza and the West Bank combined, with large reserves left over for export.
To the Palestinians, these sensational discoveries offered a potential route to economic regeneration after decades of dependency on external aid. In 2000, Yasser Arafat negotiated a deal with BG which allowed gas to be sold directly to Israel, with 40 per cent of the revenues going to the Palestinians - made up of 10 per cent to the Palestine Investment Fund and another 30 per cent to an Athens-based Palestinian construction company....
From the archives: Arafat Hails Big Gas Find Off the Coast of Gaza Strip (New York Times, September 28, 2000)