Power Plant Bombed In Gaza Is Insured By U.S. Government

Power Plant Bombed In Gaza Is Insured By U.S. Government

WASHINGTON -- As lawmakers on Capitol Hill scrambled to approve increased military funding for Israel this week, a little-noted federal agency across town prepared to spend as much as $84 million to compensate an American company for losses sustained in the Israeli bombardment of a Gaza power plant.

The money would come from the Overseas Private Investment Corporation, which helps U.S. companies expand business abroad in ways that, to quote OPIC's website, "help solve critical development challenges and in doing so, [it] advances U.S. foreign policy." The agency does all this in part by offering insurance policies designed to protect companies from political risk, a broad term that includes "war, civil strife, coups," and "terrorism."

An OPIC spokesman told The Huffington Post on Tuesday that a "U.S. investor in the power plant whose investment is covered by OPIC political risk insurance ... notified OPIC that the facility in question has been damaged."

gaza power
Flames engulf the fuel tanks of the only power plant supplying electricity to Gaza after it was hit by overnight Israeli shelling, on July 29, 2014. (Photo: Mahmud Hams/AFP/Getty Images)

That investor is likely Morganti Development LLC, a Delaware-based corporation that owns a stake in the only power plant in the Gaza Strip. As of Wednesday, OPIC said the company had yet to file a claim for the losses.

The Huffington Post was not able to contact Morganti Development LLC directly, and a representative for Morganti Group Inc., an affiliated company, did not respond to a request for comment.

The potential Gaza insurance claim highlights the costliness of U.S. foreign policy. First, the United States sends more military funding to Israel than to any other country where the U.S. military is not actively engaged in operations. That kind of aid makes it possible for the Israel Defense Forces to conduct its highly sophisticated -- and some say overly brutal -- campaign in Gaza. Ultimately, paying for the results of that operation will also partly fall on the U.S. government.

gaza power
A Palestinian man stands looking as fuel tanks burn at the only power plant in Gaza. (Photo: Mahmud Hams/AFP/Getty Images)

The Obama administration is already working to rebuild Gaza and restore the region to a pre-war state, starting with a $47 million humanitarian aid package and more likely to come. The destruction of the power plant could produce a second wave of costs to be borne by U.S. taxpayers.

Complicating matters is the fact that Hamas continues to fire rockets into Israel, and Hamas leaders have repeatedly pledged to keep up those attacks until Israel and the international community lift the blockade currently imposed on Gaza. In Washington, most of the recent funding proposals have been aimed at bolstering Israel's "Iron Dome" missile defense shield, which has neutralized hundreds of missiles fired from Gaza in the past month.

As part of Israel's response to that rocket fire, the Gaza power plant was bombed on Monday, the flames and smoke visible for miles. Amnesty International argued that the bombing amounted to a "collective punishment of Palestinians."

The power plant had been bombed for the first time in 2006, during a similar wave of fighting between Israel and Hamas. At that time, Israel stepped in to help supply civilians in Gaza with power, but only after the United States and Great Britain applied diplomatic pressure. The OPIC spokesman told HuffPost that, despite media reports to the contrary, Morganti did not file a claim for the 2006 damage.

Morganti is part of the global construction empire of Palestinian billionaire Said Khoury, a prominent philanthropist whose Consolidated Contractors Company is the largest builder in the Middle East. Morganti Group has been a subsidiary of CCC since 1988. Khoury partnered with the energy conglomerate Enron in 1999 to build the Gaza power plant, an unprecedented project for Gaza and one supported by then-President Bill Clinton. When Enron dissolved in 2002, Khoury acquired its shares in the plant and holds them through Morganti Development.

The OPIC insurance policy for the Gaza power plant was issued in 2004 and has been maintained since then.

Before You Go

ASSOCIATED PRESS
Smoke and fire from the explosion of an Israeli strike rise over Gaza City, Tuesday, July 29, 2014. Israel escalated its military campaign against Hamas on Tuesday, striking symbols of the group's control in Gaza and firing tank shells that shut down the strip's only power plant in the heaviest bombardment in the fighting so far. The plantâs shutdown was bound to lead to further serious disruptions of the flow of electricity and water to Gazaâs 1.7 million people. (AP Photo/Hatem Moussa)
ASSOCIATED PRESS
Palestinians from a damaged apartment building inspect the damage to a neighboring building, the offices of the Hamas movement's Al-Aqsa satellite TV station, in Gaza City, northern Gaza Strip, destroyed by an Israeli strike, Tuesday, July 29, 2014. Early Tuesday, Israel warplanes struck a series of targets in Gaza City, including the top Hamas leader in Gaza, Ismail Haniyeh's house and government offices, while Gaza's border area with Israel was hit by heavy tank shelling. (AP Photo/Lefteris Pitarakis)
ASSOCIATED PRESS
Palestinians from a damaged apartment building inspect the damage to a neighboring building, the offices of the Hamas movement's Al-Aqsa satellite TV station, in Gaza City, northern Gaza Strip, destroyed by an Israeli strike, Tuesday, July 29, 2014. Early Tuesday, Israel warplanes struck a series of targets in Gaza City, including the top Hamas leader in Gaza, Ismail Haniyeh's house and government offices, while Gaza's border area with Israel was hit by heavy tank shelling. (AP Photo/Lefteris Pitarakis)
ASSOCIATED PRESS
In this image taken from video an explosion hits the media complex that houses the offices of Hamas-run Al Aqsa television and radio in central Gaza City early on Tuesday, July 29, 2014. The building also houses offices of a number of Arab satellite television news channels. (AP Photo/APTN)
ASSOCIATED PRESS
Smoke and fire from the explosion of an Israeli strike rise over Gaza City, Tuesday, July 29, 2014. Israel escalated its military campaign against Hamas on Tuesday, striking symbols of the group's control in Gaza and firing tank shells that shut down the strip's only power plant in the heaviest bombardment in the fighting so far. The plantâs shutdown was bound to lead to further serious disruptions of the flow of electricity and water to Gazaâs 1.7 million people. (AP Photo/Hatem Moussa)
GIL COHEN MAGEN via Getty Images
Israeli residents and relatives take cover from a rocket attack from Palestinian militants from the Gaza Strip during the funeral of Israeli soldier Corporal Meidan Maymon Biton, 20, at the cemetery of the southern Israeli city of Netivot on July 29, 2014. Meidan was killed the previous day when a mortar shell fired from the Gaza Strip hit the Eshkol regional council, which flanks Gaza's southern border with Israel. AFP PHOTO/GIL COHEN-MAGEN (Photo credit should read GIL COHEN MAGEN/AFP/Getty Images)
GIL COHEN MAGEN via Getty Images
Israeli residents and relatives take cover from a rocket attack from Palestinian militants from the Gaza Strip during the funeral of Israeli soldier Corporal Meidan Maymon Biton, 20, at the cemetery of the southern Israeli city of Netivot on July 29, 2014. Meidan was killed the previous day when a mortar shell fired from the Gaza Strip hit the Eshkol regional council, which flanks Gaza's southern border with Israel. AFP PHOTO/GIL COHEN-MAGEN (Photo credit should read GIL COHEN MAGEN/AFP/Getty Images)
GIL COHEN MAGEN via Getty Images
Israeli residents and relatives take cover from a rocket attack from Palestinian militants from the Gaza Strip during the funeral of Israeli soldier Corporal Meidan Maymon Biton, 20, at the cemetery of the southern Israeli city of Netivot on July 29, 2014. Meidan was killed the previous day when a mortar shell fired from the Gaza Strip hit the Eshkol regional council, which flanks Gaza's southern border with Israel. AFP PHOTO/GIL COHEN-MAGEN (Photo credit should read GIL COHEN MAGEN/AFP/Getty Images)
GIL COHEN MAGEN via Getty Images
Israeli residents and relatives take cover from a rocket attack from Palestinian militants from the Gaza Strip during the funeral of Israeli soldier Corporal Meidan Maymon Biton, 20, at the cemetery of the southern Israeli city of Netivot on July 29, 2014. Meidan was killed the previous day when a mortar shell fired from the Gaza Strip hit the Eshkol regional council, which flanks Gaza's southern border with Israel. AFP PHOTO/GIL COHEN-MAGEN (Photo credit should read GIL COHEN MAGEN/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian mourners gather around the bodies of fifteen members of the Abu zeid, Duheir and al-Hashash families, that were killed in an Israeli air strike on their home, during the funeral in Khan Yunis in the southern Gaza Strip on July 29, 2014. Israel's bombardment of Gaza left dozens more Palestinians dead after a black day for the Israeli army, with the spiral of violence showing no sign of abating. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
A Palestinian relative mourns during the funeral for fifteen members of the Abu zeid, Duheir and al-Hashash families, that were killed in an Israeli air strike on their home, in Khan Yunis in the southern Gaza Strip on July 29, 2014. Israel's bombardment of Gaza left dozens more Palestinians dead after a black day for the Israeli army, with the spiral of violence showing no sign of abating. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian relatives carry the body of five year old, Rana Duheir, a Palestinian girl killed in an Israeli air strike, during her funeral in Rafah in the southern Gaza Strip on July 29, 2014. Israel's bombardment of Gaza left dozens more Palestinians dead after a black day for the Israeli army, with the spiral of violence showing no sign of abating. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian relatives carry the body of a member of the Duheir family, killed in an Israeli air strike on their home, during his funeral in Rafah in the southern Gaza Strip on July 29, 2014. Israel's bombardment of Gaza left dozens more Palestinians dead after a black day for the Israeli army, with the spiral of violence showing no sign of abating. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
MAHMUD HAMS via Getty Images
A Palestinian man stands looking as flames engulf the fuel tanks of the only power plant supplying electricity to the Gaza Strip after it was hit by overnight Israeli shelling, on July 29, 2014, in the south of Gaza City. The damage of the power plant exacerbated the heavy damage to civilian infrastructure in Gaza already inflicted during the 22 days of the Israeli offensive aimed at stamping out militant rocket fire and destroying attack tunnels. AFP PHOTO/MAHMUD HAMS (Photo credit should read MAHMUD HAMS/AFP/Getty Images)
MARCO LONGARI via Getty Images
The Nuseirat power station burns in the background in this general view over Gaza City on July 29, 2014. The only power plant supplying electricity to the Gaza Strip was knocked out of commission by Israeli shelling, deputy director of the energy authority in the Palestinian territory said. AFP PHOTO/ MARCO LONGARI (Photo credit should read MARCO LONGARI/AFP/Getty Images)
JACK GUEZ via Getty Images
A picture taken from the southern Israeli Gaza border shows an Israeli army UAV flying over the Gaza strip on July 29, 2014. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO / JACK GUEZ (Photo credit should read JACK GUEZ/AFP/Getty Images)
MAHMUD HAMS via Getty Images
A Palestinian man stands looking as flames engulf the fuel tanks of the only power plant supplying electricity to the Gaza Strip after it was hit by overnight Israeli shelling, on July 29, 2014, in the south of Gaza City. The damage of the power plant exacerbated the heavy damage to civilian infrastructure in Gaza already inflicted during the 22 days of the Israeli offensive aimed at stamping out militant rocket fire and destroying attack tunnels. AFP PHOTO/MAHMUD HAMS (Photo credit should read MAHMUD HAMS/AFP/Getty Images)
JACK GUEZ via Getty Images
Israeli soldiers and tanks hold their position on the Israeli side of the border with the Hamas-controlled Palestinian territory, on July 29, 2014. Smoke is seen in the background billowing from the only power plant supplying electricity to the Gaza Strip after it was knocked out of commission by Israeli shelling. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO / JACK GUEZ (Photo credit should read JACK GUEZ/AFP/Getty Images)
MOHAMMED ABED via Getty Images
Palestinian neighbours of the Al Aqsa television station dig through rubble after the building was destroyed in an Israeli strike in central Gaza City on July 29, 2014. Following two nights without air strikes, the violence returned to Gaza's skies overnight, with dozens more Palestinians killed and Israeli warplanes pounding 60 targets, among them the strips main power station and the house of a top Hamas official. AFP PHOTO/ MOHAMMED ABED (Photo credit should read MOHAMMED ABED/AFP/Getty Images)
MOHAMMED ABED via Getty Images
Palestinian neighbours of the Al Aqsa television station dig through rubble after the building was destroyed in an Israeli strike in central Gaza City on July 29, 2014. Following two nights without air strikes, the violence returned to Gaza's skies overnight, with dozens more Palestinians killed and Israeli warplanes pounding 60 targets, among them the strips main power station and the house of a top Hamas official. AFP PHOTO/ MOHAMMED ABED (Photo credit should read MOHAMMED ABED/AFP/Getty Images)
DAVID BUIMOVITCH via Getty Images
An Israeli canon fires a 155mm shell towards targets in the Gaza Strip from their position along the border between Israel and the Hamas-controlled Gaza Strip on July 29, 2014. Bloodshed in war-torn Gaza surged on with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ DAVID BUIMOVITCH (Photo credit should read DAVID BUIMOVITCH/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian relatives mourn for victims of the Duheir family, near the rubble of their home, after it was destroyed by an Israeli air strike in Rafah on July 29, 2014, in the southern of Gaza strip. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
Smoke rises while Palestinian rescuers search for victims under the rubble of the home of the Duheir family, after it was destroyed by an Israeli air strike in Rafah on July 29, 2014, in the southern of Gaza strip. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian relatives mourn for victims of the Duheir family, near the rubble of their home, after it was destroyed by an Israeli air strike in Rafah on July 29, 2014, in the southern of Gaza strip. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
JACK GUEZ via Getty Images
A picture taken from the southern Israeli Gaza border shows smoke billowing from a power plant in the coastal Palestinian enclave following an Israeli air strike on July 29, 2014. The only power plant supplying electricity to the Gaza Strip was knocked out of commission by Israeli shelling, deputy director of the energy authority in the Palestinian territory said. AFP PHOTO / JACK GUEZ (Photo credit should read JACK GUEZ/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian rescue workers carry the body of a member of Duheir family, after removing it from under the rubble of a building destroyed by an Israeli air strike in Rafah on July 29, 2014, in the southern of Gaza strip. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
Palestinian rescue workers search for victims in a building destroyed by an Israeli air strike in Rafah on July 29, 2014, in the southern of Gaza strip. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
SAID KHATIB via Getty Images
A Palestinian man carries a gas cylinder out of a building as others looks on after the home was hit by an Israeli air strike in Rafah on July 29, 2014, in the southern of Gaza strip. Bloodshed in war-torn Gaza surged with dozens more Palestinians killed as the conflict raged into a fourth week and Iran accused Israel of genocide in the tiny enclave. AFP PHOTO/ SAID KHATIB (Photo credit should read SAID KHATIB/AFP/Getty Images)
MAHMUD HAMS via Getty Images
A Palestinian man reacts in front of a destroyed mosque after it was hit by an Israeli air strike, on July 29, 2014, in Gaza City. Bloodshed in and around Gaza surged with strikes killing at least 13 Palestinians, a day after five Israeli soldiers died, shattering hopes for an end to three weeks of violence. AFP PHOTO/MAHMUD HAMS (Photo credit should read MAHMUD HAMS/AFP/Getty Images)
MAHMUD HAMS via Getty Images
A Palestinian man displays national flags, Islamist Hamas movement flags and portraits of Hamas top leader in Gaza, Ismail Haniya, on the rubble of the latter's house after it was hit by an overnight Israeli air strike, on July 29, 2014 in Gaza City. Bloodshed in and around Gaza surged with strikes killing at least 13 Palestinians, a day after five Israeli soldiers died, shattering hopes for an end to three weeks of violence. AFP PHOTO/MAHMUD HAMS (Photo credit should read MAHMUD HAMS/AFP/Getty Images)
ASSOCIATED PRESS
Palestinian and Islamic flags and a portrait of the top Hamas leader in Gaza, Ismail Haniyeh, are placed on the rubble of his house hit by a pre-dawn Israeli strike, in Gaza City, northern Gaza Strip, Tuesday, July 29, 2014. Early Tuesday, Israel warplanes struck a series of targets in Gaza City, including Haniyeh's house and government offices, while Gaza's border area with Israel was hit by heavy tank shelling. (AP Photo/Lefteris Pitarakis)

Popular in the Community

Close

What's Hot