AZERBAIJAN - Israel To Buy Azeri Light & Provide Passage To Eastern Markets.

Israeli Minister of National Infrastructure Benjamin Ben-Eliezer and Rovnag Abdullayev, the president of Socar on June 6 set crude oil supply negotiations in motion in Baku during Ben-Eliezer`s visit to the Azeri capital. "I'm here to open business with you", Ben-Eliezer told Abdullayev".

Israel buys one-sixth of its crude oil from Azerbaijan, but from AIOC rather than directly from Socar, according to the Chairman of Israel's Oil Refineries Ltd., Ohad Marani.

Abdullayev and Ben-Eliezer discussed starting talks on a deal under which Israel would buy Azeri Light crude oil for its two oil refineries and for transportation to the Far East via the Eilat-Ashkelon pipeline to the Red Sea. This pipeline has been idle for most of the time since it was built to handle the transfer of Iranian crude. It was built during Iran's Pahlavi monarchy which used to have a special strategic relationship with the Jewish state.

Ceyhan is roughly 373 miles north of the Israeli port city of Ashkelon. The Eliat-Ashkelon pipeline represents an opportunity for Israel to become a major oil corridor to the east.

Israeli energy industry experts were in June quoted as saying other transport options for the BTC exporters, such as passage through the Suez Canal or shipping around the entire African continent, are much more expensive routes than the Eilat-Ashkelon pipeline. Energy business people then was quoted as saying said India was likely to become a key market for Azerbaijani crude oil through the Israeli outlet.

Mordechay Shalev, Eilat-Ashkelon Pipeline Co. deputy general manager, told United Press International (UPI) in Baku during the June visit of the Israeli team that India was among the key candidates to use this route. Ben-Eliezer urged Abdullayev to visit Israel and tour the pipeline.

In previous discussions of establishing an energy corridor in Israel, the idea was to extend the BTC pipeline by an underwater section from Ceyhan to Haifa, the Jewish state's northern port city on the Mediterranean. This is linked to Ashkelon and the Red Sea by Israel's own pipeline system.

But transporting Azeri Light between the two pipelines via tankers may be a more cost-effective scenario, Israeli Ambassador to Azerbaijan Arthur Lenk told UPI. At the meeting in Socar`s Baku offices, Shalev briefed Abdullayev on the Eilat-Ashkelon pipeline`s capabilities, and Oil Refineries' Marani spoke of looking forward to co-operation between the two countries.