Egypt loses LE 100 billion from gas exports to Israel since 2005

Thursday, 17 March 2011 15:30| MEMO

Egypt loses LE 100 billion from gas exports to Israel since 2005Over the past six years, Egypt supplying natural gas to Israeli is to be more than one hundred billion Egyptian pounds.

Egyptian petroleum experts have estimated that the country’s losses over the past six years from supplying natural gas to Israeli to be more than one hundred billion Egyptian pounds.

During a recent press release, Ibrahim Zahran, an Egyptian oil expert, confirmed these as the losses incurred by the Egyptian General Petroleum Authority since signing the agreement to export gas to Israel in 2005. He pointed out that the most important reason behind these losses was the use of diesel in power plants as an alternative to natural gas, which is being exported.

Former MP, Mohammad Esmat El-Sadat, pointed the finger of blame at Maher Abaza, an advisor to Husain Salem who was regarded as the main shareholder in the East Mediterranean Gas Company that exports Egyptian natural gas to Israel.  El-Sadat claims that in 2005, Abaza wrote a letter to the Ministry of Petroleum urging it to reduce gas supply prices to $0.75 per million imperial thermal units, instead of the $1.5 minimum price stipulated in the agreement signed between the Company and the Petroleum Authority in 2000.

During the press conference at the Press Syndicate, El Sadat said that current investigations by the Attorney General showed that the Petroleum Authority’s chairman, Mohammed Taweelah, and the former Minister of Petroleum, Sameh Fahmi, both agreed to the request on the very date it was submitted, even though it seemed illogical.

“At the time of the reduction [in prices], Maher Abaza justified it by saying that the East Mediterranean Gas company was a recently-established corporation that could not buy gas at $1.5 dollars per million BTU, and that it would bear the construction costs of the offshore gas line, which would carry gas from El Arish to Ashkelon. ”

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