Israelis will ‘give up’ on Egyptian gas, expert says

[DJKeefy]

Blast is third this month, fifth this year; masked men attack police station after riding through el-Arish, waving flags with Islamic slogans.

After gunmen attacked the Egyptian gas pipeline in the northern Sinai on Saturday – the fifth such attack in the past six months – an Israeli energy expert said he believes that Israeli officials and the country’s major gas consumers have all but “given up” on that source of natural gas.

“According to the partial information we have, this explosion only affects the export of Egyptian gas to Israel,” Amit Mor, CEO and energy specialist at the Eco Energy consulting firm, told The Jerusalem Post on Saturday night. “It was directed against Israel and will not affect future supplies of gas to Jordan, Syria and Lebanon.”

During Saturday’s attack, the saboteurs used rocket-propelled grenades to puncture a hole in a section of the pipeline that normally directs gas to Israel, but whose supply had not yet been resumed from the previous attack, on July 12, Reuters reported. The gunmen arrived in two trucks but sped away from the site after being confronted by Egyptian troops.

There were no casualties, the report said.

“It is crucial to Israel that the Egyptian government establishes security control, especially in northern Sinai – and especially at the crossing point in Rafah on the Egyptian- Gazan border – to prevent the smuggling of an arsenal against Israel, and also to secure the natural gas pipeline to Israel,” Mor told the Post. “I think the major consumers and government all have given up on the supply of Egyptian gas to Israel.”

The gas supply to Israel had been due to resume shortly, according to Mor.

“While important for geopolitical and economic reasons, Israel can do without that gas – although the public will pay much higher prices, especially for electricity, in the short term,” he said. “It is a major challenge to the current – and any future – Egyptian government to maintain sovereignty in Sinai.”

Mor added that the Egyptian gas situation would be a bellwether of future policy emanating from Cairo.

“The resumption of the full contractual obligation of gas supply to Israel can be used as a test-case of the Egyptian government to maintain its international obligations visa- vis foreign direct investments in Egypt on the one hand, and its future relations with Israel on the other,” he said.


Source: http://www.jpost.com/MiddleEast/Article.aspx?id=231693

[Horus]

This could eventually be more detrimental to the Egyptian economy than to the Israeli one. All countries whether they like it or not are in effect businesses, to trade with any business you need to know that the goods will arrive and that the company is a reliable one to trade with in then first place. All countries that work the old nationalisation trick, are effectively cheating the investors who put money into the business by taking their investment share without payment. This does nothing for the faith of future investors who see the risk as being too high, the same applies to doing business with a country, if you have signed an agreement then you should honour that agreement regardless of political changes.

As the contract comes up for renewal you may impose any new terms you wish upon the buyer and it is their choice whether or not to accept the new deal, what you don’t do is to renege on the original contract, this only destroys your credibility as a country and puts any investors or future buyers off. Egypt should remember that although it is their gas and they can do as they wish with it, they are in a global market and for many reasons in the future they may be glad to sell to Israel. There are vast deposits of frozen Methane gas just sitting in the depths of the worlds oceans awaiting the technology to recover it more easily, once that happens smaller or more troublesome suppliers will struggle to sell their gas as these frozen reserves are truly vast.