Report: Egypt to Buy Back Gas from Israel

Posted: February 14, 2011 in Uncategorized

In the wake of reports of a shortage of natural gas in Egypt, a report in the Egyptian daily Al Shaab said that the Egyptian government is seeking to buy back 1.5 billion cubic meters of natural gas that was sold to Israel as part of a deal signed by Egyptian Petroleum and Mineral Resources Minister Sameh Fahmy and Israeli Infrastructure Minister Benjamin Ben Eliezer in July 2005, under US pressure. The price of the gas sold to Israel was significantly lower than the market price. One-third of Israel’s natural gas is in fact provided by Egypt under this deal.

The newspaper quoted anonymous sources who said that internal discussions in Egypt’s Ministry of Petroleum and Mineral Resources determined that at least half the natural gas sold to Israel under the deal would have to be repurchased at $14 billion, even though it was sold for $2 billion.

In recent weeks, a heat wave that struck the region has caused frequent power outages and water systems to be shut down in Egypt. According to some officials, these were caused by insufficient natural gas at many power plants. Officials have called on Egyptians to conserve power and refrain from displaying the festive lights customarily used during the Ramadan holiday this year. LINK HERE

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