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US firm seeks restart of Egypt gas flow to Israel

US investors in the East Mediterranean Gas Co (EMG) have taken legal steps against the Egyptian government to ensure gas flow resumes to Israel, an official from a US partner in EMG told Reuters on Monday

Reuters, Monday 30 May 2011
Gas Pipeline
A part of a gas pipeline is seen on fire near the northern city of al-Arish April 27.(Reuters)
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Views: 5473

EMG exports Egyptian natural gas to Israel, though following explosions on the pipeline in the wake of political turmoil in Egypt, the supplies have been halted for over a month.

In a letter to the Egyptian government, U.S.-firm EGI, a partner in EMG, said it was seeking international arbitration over Egypt's failure to protect their investment, as stipulated in a U.S.-Egyptian agreement.

The letter accuses the Egyptian government of "failing to provide EMG with full protection and security" for its investment and "refusing to resume delivery of gas to EMG."

Arbitration, which could lead to a ruling that Egypt violated its agreement and force it to pay a large compensation, could take place in Washington within six months, the official said.

Israel receives natural gas from Egypt under a 20-year deal signed in 2005.

"We don't think there is a political decision to stop gas exports to Israel, but rather a problem in the decision making process within the Egyptian government," said the official, speaking on condition of anonymity.

The official said that since the April 27 disruption, Egypt was losing $4 million a day.

EMG is owned by Egyptian businessman Hussain Salem, Egypt Natural Gas Co, Thailand's PTT, American businessman Sam Zell, chairman of EGI, Ampal-American Israel Corp and Israel's Merhav.

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01-06-2011 07:51pm
gas exports frm Egypt to Israel
Since the owner of the company is Hussain Salem who is Mubarak's partner, then it must be pretty obvious that all their holdings are now under serious scrutiny as all his assets are frozen until the government knows exactly what his finances are and if the contracts were done illegally, which is the most outstanding probability then it shall be cancelled and if the Egyptian people are willing, re negotiated.But if it is to give gaz at less than fair prices to a country that sent to Mubarak, via Cyprus a plane load of the latest high tech laser rifles & weapons to use against the Egyptian people, I doubt they will want to renegotiate such a contract and Salem/Mubarak can pay the fine since they made billions on a deal that lost Egypt billions in revenue
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