Egypt refuses arbitration decision: Pay Israel $1.76b in compensation for halting gas supply

 

Egyptian PM Sherif Ismail said it will appeal the ruling by the Int’l Chamber of Commerce within 6 weeks & a freeze to the current negotiations between Egyptian companies to import gas from Israeli fields.

By i24news

 

The Egyptian government has refused to pay a fine of $1.76 billion to Israel over halting gas supplies and has ordered its oil and gas import authorities to freeze talks with Israel.

Leviathan gas field in Israel – Photo: AFP

Egypt and Israel had signed a 20-year agreement where they would sell natural gas to Israel, but the deal collapsed in 2012 after months of attacks by Egyptian militants in the Sinai on the pipeline.

State-owned Israel Electricity Corporation had demanded more than $4 billion in compensation from Egyptian firms EGPC (Egyptian General Petroleum Corporation) and EGAS, saying the cut caused it to search for more expensive supply sources.

Egypt Mediterranean Gas, the company which oversaw the gas deal sued for damages but Israel Electric was awarded $1.76 billion plus interest and legal expenses by an international arbitrator.

Egypt’s oil and gas authorities, Egyptian General Petroleum Corp. and Egyptian Natural Gas Holding Co., issued a statement Sunday saying that they will appeal the ruling and had “received instructions from the Egyptian government to freeze negotiations between companies to import gas from Israeli fields or to award import approvals until the legal position regarding the arbitration ruling and the results of the appeal are clear.”

Egypt’s Prime Minster Sherif Ismail said it will appeal the ruling by the Geneva-based International Chamber of Commerce within six weeks.

Following the 2011 ouster of Egyptian president Hosni Mubarak, militants regularly targeted pipelines in Sinai, repeatedly forcing a halt in gas supplies to Israel and Jordan.

Israel has since been working to exploit major gas discoveries off its coast in the Mediterranean and hopes to export to Egypt.

 

View original i24news publication at:
http://www.i24news.tv/en/news/economy/94756-151206-egypt-refuses-to-pay-israel-1-76bln-for-halting-gas-supplies-suspends-talks

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