By IDN Middle East Desk Republished courtesy of IDN-InDepth NewsAnalysis
(IDN) - A new report has warned that companies with operations and suppliers in Israel, or offshore projects in disputed waters in the region, face the risk of "complicity in human rights violations by state security forces". Besides, terrorism, internal violence and regional instability pose "significant" hazards.
"Security risks for companies with operations, investments and offshore operations in Israel remain of overriding concern," cautions the UK-based risk analyst Maplecrof in its latest country report. "Organisations operating in the country face a high risk of losing personnel and assets due to violence between Israeli security forces and Palestinian militants over the status of the Palestinian territories."
Hamas continues to pose a serious security risk to Israel, primarily from Gaza, says the report, but it is not the only group to do so. "Palestinian Islamic Jihad, the Popular Front for the Liberation of Palestine and the al-Aqsa Martyrs' Brigades have also been involved in suicide attacks against Israel."
Since "suicide bombings are not necessarily restricted to land", the report asks foreign offshore exploration companies to consider this fact "when investing with Israeli companies in the Mediterranean".
The report underlines the warning by pointing out that: "In June 2010, Israeli officials said that the military had shot and killed four Palestinians wearing diving gear off the Gaza coast. The Israeli military said it believed those on board were planning a terrorist attack."
Maplecroft reflects the risk of violence in Israel in its Conflict Intensity Risk Index, which rates it as "an extreme risk country", and ranks it 25th out of 196. A similar picture is illustrated in the Terrorism Risk Index, where Israel ranks 17th out of 196 as a "high risk" country.
NATURAL GAS RESERVES
Natural gas reserves in the Mediterranean are described as a source of growing tensions between Israel and Lebanon. In fact, some Lebanese politicians say that the offshore Leviathon gas field may extend into their country's yet-to-be declared maritime zone. The two countries are formally still at war and have not agreed to a maritime boundary.
Furthermore, Lebanon has developed energy legislation to allow it to attract investors to extract fossil fuels in the Mediterranean. Israel, on the other hand, has warned that it would resort to force if necessary to protect what it considers to be its offshore fossil fuel reserves.
Analysing the situation, 'Foreign Policy' (FP) said in a web-posted report on August 17, 2010: "Israel's movement to develop the huge Tamar and Leviathan gas fields -- which could hold as much as 23 trillion cubic feet of natural gas -- has spurred Lebanon's parliament to move forward on a law enabling offshore exploration, which it passed today (August 17)."
FP added: "It is part of long-delayed oil legislation that has been debated for over a decade, but went nowhere due to Lebanon's notoriously fractious politics, government instability, and myriad external distractions. But the gas discovery has galvanized Hezbollah and its allies in the parliament's opposition, including the Amal Party, who pushed the government to pass the laws necessary to prevent Israel from 'stealing' Lebanese resources."
FP went on to say: "For now, any dispute between the two countries is confined to media sound bites and parliament chambers. But if exploration and development does get underway, it's not hard to imagine things going badly if the countries' tenuous ceasefire -- following the 2006 hostilities between them -- were to fall apart.
"Eytan Gilboa, a political science professor at Israel's Bar-Ilan University, pointed out to Bassem Mroue of the Associated Press that offshore rigs and other natural gas infrastructure would be attractive targets for Hezbollah or the IDF. Any infrastructural attack would pose not only political or economic risks to both sides, but also potentially severe environmental costs."
Underlining the dimensions of the issue, the offshoreenergytoday.com reported on August 4, 2010 that, according to internal assessments at Noble Energy, the U.S. partner in the Leviathan offshore gas exploration site, the amount of natural gas at the location is about 40 percent is larger than what had been reported up to now.
At the beginning of June 2010, Noble reported a 50 percent probability of finding 16 trillion cubic feet of gas in the Leviathan geological formation, but it has since performed further analysis of the seismic tests in the area, and now concludes there is a 55 percent probability of finding 20 to 23 trillion cubic feet of gas, the website informed.
Still to come in the coming weeks, according to industry sources, is the Leviathan partnership's assessment of the chances of finding oil in a stratum beneath the natural gas.
The website went to say that at the annual conference in London of the Tel Aviv Stock Exchange in July 2010, Noble's CEO, Charles Davidson, pegged the chances of also finding oil in deep-sea Mediterranean license areas where Delek and Noble Energy are operating at 10 to 15 percent, but he said it has never actually been examined. It is expected that any exploration drilling in the area will also include a search for oil.
The Maplecroft analysts said that the Lebanon-based Hezbollah has reportedly stockpiled weapons provided by Iran and Syria to use against Israel. They added: The security risk posed by Hezbollah was highlighted during the 34-day war of 2006, when it launched approximately 4,000 rockets -- some deep into Israel.
"Even though Hezbollah and Israel are understandably loath to engage in serious conflict at present, the prospect of another conflagration cannot be discounted given their mutual enmity," said Anthony Skinner, Principal Analyst at Maplecroft.
DISCRIMINATION
The report says that "the Israeli government generally protects the human rights of its citizens but discrimination against Israeli Arab citizens, Palestinians and other religious groups persists".
Maplecroft adds: "Discrimination is also a problem in the labour market and reports of poor working conditions and forced labour among migrant workers represent a risk of potential complicity in the actions of local business partners throughout the local supply chain."
For that reason "companies that operate in Israel also face the potential risk of complicity in the actions of members of the security forces that guard business assets".
International human rights NGOs continue to accuse members of Israel's security forces of serious human rights violations. However, the Israeli military argues that its rules of engagement are within law, strictly regulated and rigorously enforced, states the Maplecroft report.
"There is little to suggest that the security and human rights situation will improve in Israel. Previous negotiations between the Israeli government and Palestinian authorities for a peace settlement have failed and the upcoming talks between President Abbas and Prime Minister Benjamin Netanyahu are already fraught with tensions," predicts the report.
In its Political Risk Briefing on Israel, the UK-based analysts provide detailed analysis, innovative sub-national maps, stakeholder viewpoints and key recent events. Comprehensive risk analysis is broken down into individual chapters focusing on: governance framework, political violence, the regulatory and business environment, human rights and society, and an economic overview.
