An international tender for oil exploration in the West Bank for foreign companies in partnership with the Palestinian Investment Fund was put out by the Palestinian government in Ramallah yesterday.
The Deputy Prime Minister for Economic Affairs, Mohammad Mustafa, said, in a press statement, that the tender came after a ministerial committee, under his chairmanship, conducted studies and prepared tender documents in cooperation with global, legal and commercial advisory bodies.
On March 4, the Ramallah government’s council of ministers agreed to let the Ministry of Economy put out the tender, within a franchise region with an area of about 432 square kilometres, extending from the northern town of Qalqilya towards the west of Ramallah city.
Mustafa explained that participation in the tender will be open on equal terms to all companies that have the technical expertise and the financial capacity to develop the project, setting June 30 as the deadline for such companies to present their offers.
Confirmation of Sovereignty
Mustafa said that the implementation of this project “will confirm the Palestinian sovereignty over our natural resources and will act as a starting point for further projects relating to the exploitation of our natural resources, whether in Palestine, the Jordan Valley, the Dead Sea or the natural gas in Palestinian territorial waters off the coast of Gaza.”
He added: “The project will be an important step towards getting rid of the economic dependency on Israel and in line with the strategy of the Palestinian government that aims at building a strong, independent economy and providing a decent life for all its citizens.”
Currently, the Palestinian market depends entirely on fuels of all kinds being imported from Israel often at high prices which constitute the most important factors in hampering the development of the industrial projects.
Preliminary estimates indicate that the size of oil in the franchise area ranges from 30 million to 186 million barrels. According to the terms of the tender, the project will benefit the treasury of the Palestinian Authority with more than one billion US dollars during the project’s life.
In its capacity as the investment arm of the Authority, the terms refer to the entry of the Palestinian Investment Fund in partnership with the company that will be selected through the tender to form the company that will develop the project. While the exact ratio of partnership is to be determined through auction, the terms made it clear that the participation of the Palestinian Investment Fund will not represent less than 25 per cent of the project.
The investment fund will pay part of the project’s cost with a ratio that reflects its partnership in the project, according to what is known globally about the contribution of states’ investment arms in petroleum projects.