Security Risk Rankings
This week we are introducing our new security risk ranking system designed to provide investors and potential investors with a continual look at the changing security dynamics around the world. Each week we will focus on a different region, with comparative risk rankings based on various dynamics, including threats to personnel and operations, militant activity, kidnappings, border security and political stability.
The PA and Israel: Forging Peace Through Energy?
Bottom Line: A long-running plan to develop discoveries made off the Gaza Strip by UK-based BG Group appear to be languishing in a sea of false hope.
Analysis: In 1999, the Palestinian Authority (PA) awarded BG Group a 25-year exploration license for the entire offshore sector of Gaza Strip. Only a year later, BG discovered two fields here—Marine 1 and 2—with an estimated 1.4 trillion cubic feet of gas in place. This estimate could actually turn out to be a bit shy of the much more promising potential unveiled by major Israeli discoveries in the Levant Basin, with the offshore Leviathan and Tamar gas fields. BG holds a 60% stake in the field, with partner Consolidated Contractors International Co. of Greece holding 30% and the PA holding 10%. So far, so good—but holding up development here is the tricky necessity of obtaining a permit from the Israelis. For now, the $1 billion project is dead in the water while everyone—including…