Egyptian Minister of Petroleum Abdallah Ghorab is threatening that Egypt will seek the cancellation of the current gas supply agreement with Israel, and at the same time will demand a new price from Israel, Egyptian daily "Youm 7" reports.
A senior source close to Ghorab is quoted as saying that Egypt is preparing a request to an international arbitration tribunal to end the agreement. The reference is apparently to the International Centre for the Settlement of Investment Disputes in Washington DC, to which East Mediterranean Gas (EMG), the company that exports Egypian gas to Israel, intends to submit a claim for $8 billion damages against Egypt.
The source quoted in the article comments on EMG's claim, and says that Egypt will demand that the company should raise the value of the deal with Egypt to $10 billion. The current value of the deal is not known. The source is further quoted as saying that the attacks on the gas pipeline to Israel in the Sinai will continue unless implementation of the agreement in its present format is halted.
This contrasts with Israeli intelligence assessments that the central government in Egypt has no control over the attacks on the pipeline, which have led to the cutting off of supplies to Israel and Jordan three times this year. Supply has yet to be restored after the most recent attack. Israel's assessment is that past declarations by senior Egyptian figures were aimed at domestic political needs in Egypt.
A Merhav spokesperson told "Globes", "We suggest taking the reports in the Egyptian press and media with a pinch of salt. What the international investors in EMG have to say, they will say to the International Centre for the Settlement of Investment Disputes in Washington." The same source added that the investors were sure that Egypt would not allow damage to the international investors in a way that would deter other international investors from investing in the country."
EMG is owned by Egyptian businessman Hussain Salem, Egypt Natural Gas Co, Thailand's PTT Public Co. Ltd., EGI chairman Sam Zell, and Yosef Maiman through Ampal-American Israel Corporation (Nasdaq: AMPL; TASE:AMPL) and his private company Merhav Ltd.
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