Israel nationalized the Eilat-Ashkelon Pipeline Company (EAPC), which operates the trans-Israel oil pipeline that used to operate in partnership with Iran, EAPC's chairman, Yossi Peled, was quoted by Haaretz as saying on Monday.
EAPC was established in 1968 as a partnership between Israel and the National Iranian Oil Company (NIOC), to build and operate an oil pipeline from Israel's southernmost city of Eilat to the coastal city of Ashkelon on the Mediterranean coast. The partnership was brought to an end after the 1979 Islamic Revolution in Iran. NIOC is currently in the process of three arbitration actions against Israel or Israeli-owned companies, in a suit demanding billions of dollars’ worth of compensation. NIOC said in its arbitration suit that Israel has taken over EAPC and ousted its Iranian partners.
“The company is controlled by the government," Peled said, adding: “The company's franchise is about to expire in two-three years and I realized there’s an intention to privatize the company. I suggest against that such a body must remain in government ownership.”
Peled’s statement confirmed that Israel had in fact nationalized the part of the company previously owned by the Iranians, despite the military censor’s instructions banning the media from publishing details about the way the company is controlled and managed. The Israel Defense Forces’ censorship is enforcing an immunity order which forbids releasing financial or administrative details about the company’s activity. Peled said he was in favor of disclosing information about the company, contrary to the current policy of oversight by the military censor.
Serious Irregularities
The previous Iranian regime wanted to keep the deal secret, and therefore Israel issued an immunity order that subjected the company, its funding sources and fuel sources to the military censor. Partnership between the NIOC and the EAPC terminated in 1979, but the immunity was upheld. Until now, EAPC has been exempted from environmental regulations, planning and building laws, and from government and public scrutiny.
“I’m very uncomfortable with the immunity, but it’s out of my hands. Forty years ago, it was decided that it was secret and it stayed that way. As far as I’m concerned, everything can be released. But Israel is the shareholder, not I,” Peled said.
The company’s former directors abused the immunity and used it to conceal state comptroller’s reports that found serious financial and administrative irregularities in the company’s activities. Until now, the company has operated under a shroud of secrecy and no one from the company has been ever brought to trial for negligence, despite last December’s massive oil leak in the Evrona Nature Reserve in southern Israel and the grave comptroller reports.
