Begin, Sadat to Discuss Oil Issue

The nature of future oil transactions between Israel and Egypt will have to be determined in the upcoming meeting between Premier Menachem Begin and Egyptian President Anwar Sadat at the beginning of next month in Haifa.

The Knesset Security and Foreign Affairs Committee heard a report yesterday from Energy Minister Yitzhak Modai on his recent talks in Egypt on this subject. Most of the members shared the view that current arrangements for the supply of Egyptian oil to Israel after Israel withdraws from the Alma oil fields in southern Sinai at the end of November were unsatisfactory. Details were not disclosed.

Modai said that even after his talks in Egypt last week with the Egyptian Fuel Minister Ahmed Ezzadin Hilal, Israel still disagreed with Egypt about the exact quantities and the price of oil. Egyptian oil experts were scheduled to arrive in Israel today for technical discussions which should help clarify various aspects of the handover of the oil fields, and the oil transactions afterwards.

Modai said that discretion and an absence of publicity were to the advantage of both countries as far as their oil relations were concerned.

Four Likud members on the committee, Yigael Horvitz, Yosef Rom, Moshe Arens, and Eitan Livni, said the oil agreement as it appeared to be emerging, would not meet Israel’s basic needs nor serve its vital interests.

Rom said the Egyptian oil would cost more than Israel anticipated. He suggested that Israel should reopen the Camp David agreements in order to ascertain the supply of oil to Israel. Arens suggested that any agreement with Egypt should make sure that any breach of that agreement would constitute a violation of the peace agreement.

Modai responded that the oil deal, as it was shaping up, was the best Israel could obtain under the circumstances of the overall Israel-Egypt peace agreement. It was reported last week that Modai was told by Hilal that Israel will not get oil from the Alma oil fields immediately after transferring them to Egypt as originally promised but would have to wait another nine months until the normalization of relations between the two countries goes into effect in accordance with the Israeli-Egyptian peace agreement.

In addition, Hilal said that each January Egypt will put up for international bids the oil from Alma. If Israel is the highest bidder, it will get the oil, otherwise some other country will get it, Hilal said.