The Israeli Exploitation of Palestinian Natural Resources: Part I

Update | Oct 2016

The potential contribution of natural resources to the Palestinian economy is extremely large. Today, the exploitation of key natural resources strips the Palestinian economy of billions of dollars each year. This flash report researched by Who Profits will include an introductary section, in addition to three others, featuring the following companies: HeidelbergCement, Ahava, and Ashtrom. All of which are deeply complicit in the illegal exploitation of Palestinian natural resources.

From the early moments of the Israeli occupation of the Palestinian territory, the Israeli exploitation of Palestinian natural resources served as the backbone for the development of the economy of the occupation.

The Israeli economic strangulation of the occupied West Bank, where the most significant reserves of natural resources are located, has been taking place for more than four decades, benefiting the Israeli market and securing mounting profits for Israeli and multinational corporations. Through its various methods of land appropriation, building restrictions, closure policies and continuous pillage of occupied land – Israel has woven a tangled web of military laws and economic policies that serve its own geopolitical interests, keeping the Palestinian economy in a perpetual state of de-development and subordination to the Israeli economy. The exploitation of minerals and stone quarries in the West Bank, alongside the restrictions on Palestinian economic activity, have been particularly detrimental to the Palestinian economy.

As numerous reports have shown, the potential contribution of natural resources to the Palestinian economy is extremely large. Today, the exploitation of key natural resources strips the Palestinian economy of billions of dollars each year. In fact, according to the estimate of the World Bank, the Palestinian economy loses 3.4 billion dollars annually, which could potentially increase the Palestinian GDP by a third. More specifically, the potential value of mining production in the West Bank alone is estimated to be $900m (£580m) a year. [1] Reclaiming the collective rights over the land and its natural resources[2] for the Palestinian people would bring substantial benefits to the Palestinian economy and “could usher in a new period of increasing Palestinian GDP and substantially improve prospects for sustained growth.”[3]

The Who Profits database has profiled more than 40 major Israeli and international corporations that are actively involved in the exploitation of Palestinian natural resources. Who Profits also produces updated lists of the Israeli quarries operating on Palestinian occupied land, as well as a regularly updated online report, focusing on Israeli construction on occupied land.

This flash report aims to examine corporate involvement in the illegal Israeli exploitation of Palestinian land and natural resources for the benefit of the Israeli market and settler population, highlighting the industry as a whole while also specifically focusing on the case studies of the companies: HeidelbergCement, Ashtrom and Ahava.

The Israeli Quarrying Industry

In the immediate aftermath of the 1967 Israeli occupation of the Palestinian territory, Israel began digging for minerals and other natural resources, focusing its mining and quarrying activity in the occupied West Bank.

Although Israeli stone and gravel quarries in the West Bank did not begin to operate until the early 1970s, by the 1980s, Israeli quarrying activity in the area had expanded significantly. With the large increase of illegal settlements in the occupied West Bank in the 1990s, the demand for raw materials for construction rose and the quarrying industry reached a new level of professionalism. [4]

Stone mining and quarrying comprise a significant source of income and production for area C in particular, which comprises 61% of the West Bank. Currently, only 70 of around 300 Palestinian stone mining and quarrying operations are located in Area C, while the most productive quarries[5] are under Israeli administration, generating profits for Israeli and multinational corporations and benefiting the Israeli construction market.

The mining and quarrying sector supplies most of the raw materials required for the Israeli construction sector as a whole, which includes construction within the Green Line and in the settlements. The raw materials mined include concrete mixtures (sand, gravel and cement), mortar (chalk, clay and gypsum), lime and plaster (sand, lime and cement), mosaics, stone for cladding and flooring, etc. Road construction also requires gravel as a subgrade and filler material, as well as quarry sand and basalt gravel for asphalt mixtures.

Quarrying in the West Bank and the Strangulation of the Palestinian Economy

In Area C of the occupied West Bank, 11 Israeli administered quarries provide the Israeli market with the largest amount of gravel (chalk and dolomite), the main material extracted from Palestinian land.

Despite the provisions of the Oslo Accords, no new permits have been issued to Palestinian companies to open quarries in Area C since 1994, while a very small number of Palestinian quarries still operate with Israeli permission in Area C. [6] Many of the permits that were granted expired, and their majority have not been renewed.

In Areas A and B in the West Bank, most quarries are under Palestinian ownership supervised by the Palestinian Authority, but provide a much smaller amount of quarried and mined gravel stone for the Palestinian market. Since not all of the limited raw materials extracted from Areas A and B are used by the Palestinian market; for example, the stone production of boulders are based solely on the needs, benefit and demand of the Israeli market. Since it has been established by Israel that the use of raw material by the Israeli market will continue in the future without significant changes[7]– it is also safe to assume that the Palestinian supply to the Israeli market will remain the same.

In the de-developed Palestinian extractive industry, the stone industry faces restrictions affecting the potential of production and the scope of import and export of goods. These restrictions include; “dual list” prohibitions on production machinery, costly requirements for export, and the general political and security environment which inhibits large capital investment needed in this industry.

Despite the fact that the use of Palestinian natural resources by the State of Israel contravenes international law, the mining and quarrying operations conducted by companies in the occupied Palestinian territory were legalized by an Israeli High Court of Justice (HCJ) ruling dated to the 26th of December 2011. This ruling dismissed the 2009 petition filed by the Israeli NGO Yesh Din that challenged the legality of Israeli quarries in the West Bank. In its ruling, the HCJ also stated that the Israeli quarries provide employment for Palestinian workers. Nevertheless, as noted in Yesh Din’s response to the ruling on the 3rd January 2012, “the granting of mining concessions to Israeli and international companies ‘in exchange’ for the creation of a few jobs for Palestinians enables the robbery of that collective wealth, and it cannot be considered to be an act that benefits the local population.” Several leading Israeli scholars submitted an expert legal opinion to the court, challenging its interpretation of international humanitarian law in this ruling.

In addition, Israeli companies are allowed to transfer raw materials extracted from the oPt to Israel, thereby contravening international law regarding the depletion of natural resources in an occupied territory.

Today, the 11 Israeli administered quarries in area C provide 12 million tons of construction material annually. According to Yesh Din, approximately 75% of the products yielded by Israeli and internationally owned quarries in the West Bank are transferred for use in the Israeli construction market. [8] In some of the quarries the percentage reaches 94%. The rest, 7-8 million tons annually, is used for the illegal Israeli settlement construction industry in the occupied West Bank. Only a small fraction is used to serve the Palestinian construction market. [9]

Who Profits’ research has provided evidence that Israeli and international companies which own the quarries, transfer some of their profits to the Israeli civil administration in the oPt, which in turn facilitates their activities in expanding and sustaining illegal settlements on Palestinian land. A small remaining fraction of the excavated material from area C is then imposed on the Palestinian market as a captive market, further securing the Israeli corporate hold over the occupied Palestinian land and natural resources. In the words of the Israeli National Outline Plan itself “the West Bank is rich in resources necessary for the construction and quarrying market, especially with regards to gravel, which is highly sought after in Israel”. [10]

Assuming the Israeli exploitation of Palestinian natural resources continues, reserves in the occupied West Bank will continue to produce natural resources only for a further period of approximately 3 decades, stripping the Palestinian economy from tapping any remaining economic potential through its key natural resources. [11]

Since Area C is where the majority of the West Bank’s natural resources lie, the impact of the Israeli exploitation of natural resources on the Palestinian economy has been considerable. Thus, the key to Palestinian prosperity continues to lie in the removal of these restrictions. As this report shows, rolling back the restrictions would bring substantial benefits to the Palestinian economy and substantially improve prospects for sustained growth.

List of quarries in the occupied West Bank

  • Yatir quarry: A stone quarry next to the Israeli settlement of Teneh Omarim. The quarry is owned and operated by the private corporation Kfar Giladi Quarries Management and Development, and by the council of Kibbutz Kfar Giladi.
  • Meitarim quarry: A stone quarry next to the Israeli settlement of Teneh Omarim. The quarry is owned and operated by the Israeli holding company R.E.G Investments and Holdings, through its subsidiary, Oron Group Investments and Holdings. The company generates 68 million NIS in yearly revenues (2014).
  • Beit Hagai quarry: A stone quarry near the settlement of Eshkolot. While the quarry’s mining rights are owned by the settlement of Beit Hagai, its operation is carried by the Israeli construction company Medan – Roads and Quarries. The company also operates asphalt and bitumen emulsion factories in the premises of the quarry. In September 2012, the Civil Administration allowed Medan to expand the quarry’s activity to the land of the Palestinian town Dura.
  • Adora quarry: Located near the settlement of Adora and Highway 35, Adora quarry produces raw materials for cement and asphalt that reach 35 million ton. The quarry is operated by Elyakim Ben Ari company that also operates a cement and asphalt factory nearby the quarry.
  • Salit Haadumim: Quarrying and Factory for Stone Works that is located north of the Mishor Adumim industrial zone, on Road 437.
  • Nahal Raba quarry: An aggregates quarry located near the settlement of Elkana. The quarry is owned and operated by Hanson Israel, a subsidiary of Heidelberg Cement – the world’s largest cement producer.
  • Natuf quarry: A stone quarry located near Nili settlement. It is owned by Shapir Civil and Marine Engineering, a civil engineering and construction company, which operates several plants for construction materials in the West Bank and constructs housing and infrastructure projects in illegal settlements.
  • Beitar Illit quarry: A stone crusher located in the area of Beitar Illit settlement. It is owned and operated by Netivey Beitar, a subsidiary of the Israeli construction company Ashtrom.
  • Kochav Hashahar quarry: A stone quarry located near the settlement of Kochav Hashahar sprawling into the land of the Palestinian village Kofour Malik. The quarry is owned and operated by Mordechai Binyamin and Sons Earth Work.

 


[1] World Bank Report No. AUS2922 WEST BANK AND GAZA Area C and the Future of the Palestinian Economy October 2, 2013, page x paragraph ix. Available here: http://goo.gl/ChS0OS.

[2] The economic costs of the Israeli occupation for the occupied Palestinian territory, a bulletin published by the Palestinian Ministry of National Economy in cooperation with the Applied Research Institute- Jerusalem (ARIJ), September 2011 – page 20.

[3] World Bank Report, October 2013, page viii paragraph iv.

[4] Mining and Quarrying in Israel, Israeli Ministry of National Infrastructure, Energy and Water Resources. Available here: http://bit.ly/2e8aFtf.

[5] World Bank Report, October 2013, Page 38.

[6] Union of Stone and Marble Industry (USM), Stone & Marble in Palestine Developing a Strategy for the Future, July 2011. Available here: http://bit.ly/2dP7BTa.

[7] Israeli Ministry of Interior – Administration of Planning, NPA 14 B – National Outline Plan for mining and quarrying sites directed at the construction and road-building market, pages 68, 71.

[8] The total supply of mining and quarrying materials is estimated at 50 million tons per year. See: Mining and Quarrying in Israel.

[9] The economic costs of the Israeli occupation for the occupied Palestinian territory, A bulletin published by the Palestinian Ministry of National Economy in cooperation with the Applied Research Institute- Jerusalem (ARIJ), September 2011 – page 20.

[10] Israeli Ministry of Interior – Administration of Planning, page 3.

[11] Ibid, page 71.




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