A senior Egyptian minister said on Monday her country is ready to resume gas exports to Israel but at a new price, after scrapping a long-term contract.

International Cooperation Minister "Fayza Abul Naga said the Egyptian side had no objections to reaching a new contract with new conditions and a new price," the official MENA news agency reported.

Egypt annulled the contract last Thursday, saying Israel had not met the conditions of a gas export accord signed in 2005.

Abul Naga said Israel had been notified five times that it was not meeting its financial obligations under the old contract.

Egypt's electricity and fuel minister, Hassan Yunis, said earlier that the natural gas being exported to Israel under the controversial deal would be used domestically.

"The gas that used to be exported to Israel will be directed to Egyptian electricity plants, as we have more right to it," he told reporters.

The gas contract with Israel, which signed a peace treaty with Egypt in 1979, was the largest trade deal between the two former foes and has always been controversial in the Arab world's most populous country.

Israel downplayed the political significance of the cancellation on Monday, calling it a "commercial dispute" with no impact on diplomatic relations with Egypt.

"We don't see this cutoff of the gas as something that is born out of political developments," Prime Minister Benjamin Netanyahu told a meeting of heads of the Israel Bonds fundraising organisation.

"It's actually a business dispute between the Israeli company and the Egyptian company," Netanyahu's office quoted him as saying.