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Claiming ‘Private’ to Evade Democracy? The Leviathan Gas Deal and the Jordanian Constitutional Court

Published on February 12, 2020        Author: 

 

In 2014, a Jordanian activist stumbled upon an article in the New York Times claiming that Jordan is planning to sign an energy deal with a number of multi-national corporations planning to exploit gas fields controlled by Israel in the Mediterranean. A few weeks later, the Jordanian minister of energy confirmed the claims in a press conference, the news was met with condemnation from the majority of parliamentary members, political parties, unions and civil actors in Jordan, as thousands took to the streets, with a good number of activists arrested and/or harassed for their involvement. These movements led to the establishment of the campaign against the gas deal. Popular dissent for the deal is backed by economic, policy and moral concerns especially with the lack of transparency on either side of the bargain, as more evidence showed that the deal was driven on an agenda of foreign relations rather than the wellbeing of the fragile Jordanian economy and its poverty stricken public. The absence of legal tools to contest the deal led the coalition of political parties to organise a symbolic popular court where the concerns of the Jordanian public were laid out. The government did not provide proper responses, claimed that secrecy clauses forbad such intervention, and that it is already too late as sunset clauses in the contract would put a heavy burden on the economy. On the Israeli side, civil society actors have expressed environmental concerns surrounding the extraction of gas leading to a case at the Israeli Supreme Court that temporarily halted the extraction.

Recent leaks shed further light on the terms of the contract (in Arabic), reigniting public dissent. In sum, the contract’s signatories were the government owned electricity company NEPCO, and NBL Jordan Marketing Limited, an offshore corporation registered in the Cayman Islands and owned by three Israeli corporations: Delek Drilling, Avner Oil Exploration, Ratio Oil Exploration alongside a subsidiary of the US based multi-national corporation Nobel Energy. Nevertheless, the contract confers rights and obligations on the Jordanian, Israeli and US governments (which is the main guarantor of the contract). The contract regulates the supply of 45 billion cubic meters of natural gas to be used for powering electricity in Jordan for over 15 years, for the amount of $10 billion, a rather big commitment for such a small country. Most notably: the deal limits Jordan’s capacity to exploit its local gas, if such a source were to be discovered during the period of the contract; it mandates a five year secrecy clause over any relevant contracts and arbitration awards; it contains a stabilisation clause that explicitly excludes consideration of changes in Jordanian law as a force majeur; the deal is also designed in a manner that escapes the Jordanian taxation regime at all stages; and as per dispute resolution, the contract explicitly excludes the jurisdiction of Jordanian courts and assigns an arbitration agreement. It also provides for uneven cancellation terms in favour of the of the multinational corporations. Read the rest of this entry…

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