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Gas line blast hikes Israeli energy fears

Flames shoot into the sky from a gas pipeline after unknown saboteurs bombed the Egyptian pipeline near the village of Al-Sabil in the El-Arish region of the Sinai on April 27, 2011, forcing authorities to cut supplies to Israel and Jordan, an official told AFP. Photo courtesy AFP.
by Staff Writers
Tel Aviv, Israel (UPI) Apr 27, 2011
The bombing and shutdown of a natural gas pipeline from Egypt to Israel has heightened fears in the Jewish state that the post-revolutionary regime in Cairo will cut off vital gas exports.

Israel "should be prepared to for a situation where the gas flow from Egypt would stop," National Infrastructure Minister Uzi Landau warned after Wednesday's bombing at the al-Sabil terminal outside El Arish in the northern Sinai Peninsula.

The terminal was shut down after a bombing Feb. 5 damaged a section of the pipeline that runs from Port Said on the northern end of the Suez Canal. Gas supplies were cut for five weeks. On March 27, explosives were planted at the terminal but they failed to detonate.

The attacks were attributed to anti-government Bedouin tribesmen, who tried to sabotage the pipeline last July. But there are suspicions they are linked to Islamist militants opposed to Egypt's historic 1979 peace treaty with Israel and who may become more politically active since the downfall of President Hosni Mubarak.

The 2005 gas agreement, a consequence of the 1979 treaty, has come under intense public scrutiny in Cairo since Mubarak, whose regime sealed the deal, was driven from office Feb. 11 after an 18-day pro-democracy uprising.

Mubarak is being interrogated over the contract between Egypt's East Mediterranean Gas Co. and the Israel Electric Corp. amid allegations he and some subordinates profited from it and sanctioned the sale of gas at preferential prices.

Mubarak, who ruled for 30 years and was an ardent advocate of the peace treaty even though it is widely reviled by most Egyptians, could be charged with corruption and plundering public money.

Al-Ahram, Egypt's leading newspaper, claims Mubarak received a commission for allowing EMG a monopoly over gas sales to Israel.

On Saturday, the interim military council running Egypt ordered former Energy Minister Sameh Fahmy and six associates to stand trial on charges of graft concerning the gas deal.

Egyptian authorities claim the state lost at least $714 million in revenue from the sale of cut-price gas to Israel and have ordered a review of that agreement and others involving gas sales to Jordan and Syria.

Under the 2005 agreement, EMG provided Israel with 60 billion cubic feet of gas a year for 15 years. That started at an initial price of $1.25 per million British thermal units, and raised to $4 per million Btu in 2008.

There are no benchmark prices for natural gas but Israel's Haaretz daily reported that in comparable deals Turkey, Greece and Italy paid $7-$10 per million Btu.

Israelis' mounting concerns that all this presages Cairo the closing of the gas flow were bolstered by a recent poll by the U.S. Pew Research Center, released Monday, that 36 percent of Egyptians questioned said they favor maintaining the 1979 peace treaty.

Cairo's warming relations with Iran since Mubarak was forced to step down and the possibility that diplomatic ties, severed in 1980 following Egypt's recognition of Israel, could be restored have also caused unease in the Jewish state.

Last week Egypt denied a Kuwaiti report that Iran had appointed an ambassador to Cairo.

But Israelis remain worried that their partnership with Egypt, the cornerstone of their security doctrine, is in jeopardy at a time when U.S. power in the region is waning while Iran's is widening.

Loss of the Egyptian gas, which is the primary fuel for generating electricity in Israel, would be a major blow for the Jewish state's economy.

Over the last few years, the Israelis have discovered major gas fields in the eastern Mediterranean that could cover its energy requirements for the next 50 years. But the first of these fields, which contain an estimated 25 trillion cubic feet of gas and several billion barrels of oil, isn't expected to come on stream until 2013.

So if the Egyptian gas is cut off, Israel will have to rely on a small gas field off the southern port of Ashdod and buy expensive diesel fuel or coal to keep power plants running.

Deputy Foreign Minister Danny Ayalon said "the lack of regional stability is probably going to continue in the foreseeable future."

Israel, he declared, "must achieve self-sufficiency in its energy needs."



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