Egypt gas pipeline to Israel and Jordan blown up by saboteurs

An earlier attack on the same pipeline, located south of the North Sinai town of al-Arish, was staged on February 5 during an 18-day-uprising that forced former president Hosni Mubarak to step down on February 11.



Last Saturday, April 23, Egypt’s public prosecutor ordered former Energy Minister Sameh Fahmy and six other officials to stand trial on charges of squandering public funds related to the natural gas deal with Israel.



The decision to prosecute the officials was part of a probe on graft during the 30-year-rule of Mr. Mubarak. The public prosecutor said the deal in question caused Egypt losses worth more than $714 million and enabled a local businessman to make financial profits.



Israel gets 40 percent of its natural gas from Egypt, a deal built on their landmark 1979 peace accord. Many Egyptians viewed the Egypt-Israel gas deal with mistrust.



According to classified information revealed by the Kuwaiti newspaper al-Jareeda, the 2005 gas deal involved both of Mr. Mubarak’s two sons who are believed to have reaped large commissions.



The gas deal is also dubbed as illegal since the deal’s contract was signed without any government approval and constitutionally invalid. The Egyptian constitution stipulates that the sales of any mineral and non-mineral resource should have the approval of the people’s council.



According to the paper, a key shareholder in the private company that brokered the deal was the president’s longtime friend, Hussein K. Salem. A senior Egyptian official said the intelligence service also owned a slice of the deal.



Mr. Salem, an intelligence agent turned tycoon fled Egypt after the revolution, and is being sought by prosecutors.



In November 2010, opposition groups filed a suit challenging the deal and said that the gas agreement, which was under a 15-year fixed price deal, was a rip-off for the country of 82 million people.



Few details are publicly available concerning the deal that was signed between a private Egyptian company, partly owned by the government, and the state-run Israel Electric Corporation.



According to reports, under the deal, the Cairo-based East Mediterranean Gas Company agreed to sell 1.7 billion cubic meters of natural gas to the Israeli company at a price reportedly set at $1.50 per million British thermal units (BTU).



A senior Egyptian official, who spoke on the condition of anonymity told the New York Times last week that the permission for the sale came from the presidency and the intelligence agency, which had a small stake in the deal along with the government-owned Egyptian Natural Gas Holding Company.



He said ministers outside the petroleum ministry were not consulted, and the government ignored a court order to show publicly that the deal was not diverting gas needed domestically.



(Abeer Tayel of Al Arabiya can be reached via email at: [email protected])