An explosion shook a gas terminal in Egypt’s northern Sinai Peninsula on
Saturday – setting off a massive blaze that was contained by shutting off the
flow of gas to neighboring Jordan and Israel, officials and witnesses
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Egypt’s natural gas company said the fire was caused by a gas leak
– but a local security official said an explosive device was detonated inside
the terminal. The regional governor said he suspected sabotage.
and fire at the gas terminal in the Sinai town of El-Arish did not cause
Infrastructure Minister Uzi Landau said in a statement
Saturday that Israel is prepared for unexpected disruptions in the supply of
natural gas from Egypt, and that a drill was held last June when an exact
scenario was simulated.
Landau added that his ministry is conducting
consultations with Prime Minister Binyamin Netanyahu and security authorities as
“No disruption of the electricity supply is expected,”
Landau said, adding that Israel has the capacity to immediately switch to
alternative energy sources.
A Ministry spokesperson declined to respond
to questions from The Jerusalem Post over reports that the blast had been caused
by an explosion in the terminal.
Army Radio reported Saturday that the
gas pipeline is only expected to begin servicing Israel in about a week, once
repairs are made.
The explosion sent a pillar of flames leaping into the
sky, but was a safe distance from the nearest homes, said regional governor
Abdel Wahab Mabrouk. He added the fire was brought under control by mid-morning,
after valves controlling the flow of gas were closed.
The terminal is
part of a pipeline system that transports gas from Egypt’s Port Said, on the
Mediterranean Sea, to Israel, Syria and Jordan. The Sinai Peninsula, home to
Beduin tribesmen, has been the scene of clashes between residents and security
The head of Egypt’s natural gas company, Magdy Toufik, said in a
statement that the fire broke out in the terminal “as a result of a small amount
of gas leaking.”
However, a senior security official, who spoke on
condition of anonymity because he was not authorized to discuss the issue with
reporters, said an explosive device was detonated in the terminal.
Prime Minister’s Office said it’s not clear whether damage was caused to the
pipeline leading to Israel.
“But as a security precaution, Israel
temporarily stopped – by its own initiative – the transfer of gas as procedure
dictates,” Netanyahu’s office said.
Late last week, the AP reported that
the turmoil in Egypt has spurred an unexpected boom in Israel’s nascent energy
sector – as investors bet that demand for locally produced natural gas will
surge because of doubts about the stability of supplies from Egypt.
investors are buying stock in small companies that could boom – or bust – a
development that is worrying professionals.
“At the moment, there is the
fear that there will be problems with incoming gas from Egypt,” said Liat
Glazer, an analyst at the Excellence- Nessuah investment house.
officials say the flow of Egyptian gas has not been disrupted, but the deal with
Israelis unpopular in Egypt. Speculators are trading on concerns that the contract
might not survive the turmoil there.
Israel’s long energy shortfall began
to turn around in recent years with discovery of offshore gas
Two years ago, Noble Energy, the US-based company leading the
exploration, announced deep-water finds that dwarfed earlier offshore
In December, it announced it had uncovered the world’s
largest deepwater discovery in the past decade.
In all, Noble and its
Israeli partners claim to be sitting on some 25 trillion cubic meters of
deep-water gas – enough to keep Israel energy self-sufficient for decades. Gas
could start flowing from one of the fields by late 2012, experts say.
scope of the finds fueled a gas rush on the Tel Aviv Stock Exchange – even
before the new fears about the Egyptian gas supply arose – bringing in retail
investors for the first time since a mid-1990s bubble burst.
energy market is relatively new, providing an element of the gold rush
Six years ago, all of Israel’s electricity was generated by
imported coal and oil. Today, roughly half of the fuel Israel uses comes from
natural gas – drawn in equal parts from Israeli and Egyptian sources – which
started pumping to Israel in 2008 under a 15- year contract for 1.7 billion
cubic meters per year.
Amit Mor, an energy analyst, forecasts that by
2020, as much as 70 percent of Israel’s electricity could be powered by natural
The Sinai gas pipelines have come under attack in the past. Beduin
tribesmen attempted to blow up the pipeline last July as tensions intensified
between them and the Egyptian government, which they accuse of discrimination
and ignoring their plight.
Egypt has potential natural gas reserves of
1.7 trillion cubic meters, the 18th largest in the world.
The deal with
Israel has raised controversy at home, with some in the Egyptian opposition
saying the gas was being sold at below-market rates.
Others resent their
neighbor’s treatment of Palestinians, and say Egypt shouldn’t supply energy to
“The deal [to sell gas] was a blow to the pride of Egyptians and
a betrayal,” former diplomat Ibrahim Yousri said Saturday.
Yousri led a
high court challenge to try to halt Egypt’s sale of gas to
Although the high court ruled in his favor in February 2010, the
ruling was widely ignored by the government.