Monday, April 23, 2012

Egypt terminates 2005 gas deal with Israel

A pipeline delivering gas from Egypt to Israel near the city of al-Arish in northeastern Egypt burns following an attack on March 5, 2012.

Source: Press TV

Egypt has repealed a 2005 gas export accord with Israel, which used to rely heavily on Egyptian natural gas to generate electricity.

The deal was "annulled on Thursday with the East Mediterranean Gas Co (EMG), which exports gas to Israel, because the company failed to respect conditions stipulated in the contract," Mohamed Shoeib, the chairman of state-owned Egyptian Natural Gas Holding Company, told AFP on Sunday.

The provision of gas to Israel has constantly formed a contentious topic among the Egyptian public, which views Tel Aviv as an enemy and opposes engaging in any form of business with it.

The deal would oblige Egypt to supply gas to Israel as one of the main economic conditions of a US-sponsored 1979 peace treaty between the two sides.

In line with the USD-2.5-billion export deal, Israel would receive around 40 percent of its gas supply from Egypt at an extremely low price.

According to the results of an opinion poll, conducted for Press TV and published on October 3, 2011, 73 percent of the Egyptian respondents opposed the terms of the agreement.

The country used to be Tel Aviv’s strongest Arab ally during the roughly-30-year-long rule of former dictator Hosni Mubarak, who was deposed in a popular revolution in February 2011.

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