Egypt reviews re-start of gas exports to Israel

By REUTERS
June 2, 2011 12:34

Petroleum minister says resumption is "under review;" Egypt wants to negotiate contracts with foreign gas buyers.

1 minute read.



Flames from February attack on Sinai gas pipeline

Egypt gas pipeline blast 311. (photo credit: REUTERS)

CAIRO - Egypt is reviewing the timetable for resuming gas exports to Israel and wants to negotiate more flexible contracts with foreign gas buyers, the Egyptian oil minister said on Thursday.

Asked when Egypt would resume the exports, Petroleum Minister Abdullah Ghorab said the issue was "under review".

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He was speaking at a meeting of the Gas Exporting Countries Forum (GECF) in Cairo.

Israel received natural gas from Egypt under a 20-year deal signed in 2005, but flows were halted when an armed gang attacked a metering station in North Sinai on April 27.

Supplies have been halted for over a month, and US investors in the company that operates the Israel export pipeline, Ampal American Israel Corp, have taken legal steps against Egypt's government to ensure gas flows resume.

Israel gets up to 45 percent of its natural gas from Egypt.

Egypt said in April it would review its gas contracts with other states, including Israel and Jordan, amid accusations that the government of deposed President Hosni Mubarak had improperly negotiated the sale of gas at preferential prices.

In an apparent reference to Egypt's efforts to renegotiate gas terms, Ghorab said on Thursday he favored flexible contracts and pricing formulas to allow a "fair and sustainable relationship between sellers and buyers".

"This was exactly our understanding in Egypt of how this relation should be when we got into a renegotiation process for revising Egyptian export gas prices for our long-time contracts that have been accomplished a long time ago under completely different world market conditions," Ghorab said.

"Mutual understanding and a positive response from all parties (should) help in achieving stable long-term supplies that satisfy the interests of all parties", he added.


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