Murdoch, Lord Rothschild invest in Israeli shale oil

Lord Jacob Rothschild and Rupert Murdoch have invested in an Israeli venture to produce oil from bituminous-bearing rock (shale) in the Elah Valley in the Judean foothills. Last week, they acquired 11% in equal shares of Genie Energy Corporation unit Genie Oil and Gas Inc. for a total of $11 million.
Genie Energy, a subsidiary of IDT Corporation (NYSE: IDT), is the parent company (89%) of Israel Energy Initiatives Ltd. (IEI), which holds an exclusive shale oil exploration and production license covering 238 square miles in the Adulam district, which is between Beit Shemesh and Beit Guvrin. The company believes that its shale oil cracking technology can free the world from dependence on Arab oil and turn Israel into an energy powerhouse able to produce 300 billion barrels of non-conventional oil at a cost of up to $40 per barrel.

Genie Energy comprises IDT Energy,which resells electricity and natural gas to customers in New York, and Genie Oil and Gas Inc. Genie Oil and Gas Inc., which received the $11 million investment, consists of American Shale Oil Corporation, and the 89% stake in Israel Energy Initiatives.

Negotiations with Lord Jacob Rothschild and Murdoch began six months ago, and Lord Rothschild visited Israel during that time. Genie is involved in similar projects in Colorado and Mongolia. IEI president Effie Eitam, who served as minister of national infrastructures in the Sharon government, told "Globes" that IEI hopes to obtain a permit from the regional planning and building commission within days to carry out a pilot shale oil project on a six-dunam (1.5-acre) site in the Elah Valley.

Local residents strongly oppose IEI's venture. They fear possible environmental damage from the drilling. Residents claim that the drilling will harm the Adulam District's vistas and nature, as well as its vineyards, which have been called the Israeli Provence.

Murdoch, Lord Rothschild invest in Israeli shale oil - Globes