According to a recent Reuters report, the Egyptian decision to halt its already erratic natural gas supply to Israel was not, as the Egyptian government had put it, due only to financial disagreements. The report cites shareholders in East Mediterranean Gas Co (EMG) who stated: “Any attempts to characterize this dispute as a mere commercial one is misleading. This is a government-backed contract sealed by a memorandum of understanding between Egypt and Israel that specifically refers to the (1979) peace treaty.”
The international shareholders further accused the Egyptian oil and gas companies of failure to protect the pipeline from attack, failure to repair it promptly and the grim fact that they have “delivered almost no gas to EMG since February 2011.”
The Egyptian oil and gas companies have incurred substantial penalties due to their failure to supply the gas, according the shareholders.
Egypt Natural Gas Co is a also a shareholder in EMG.
(Meanwhile, according to Ha’aretz, the Israel Electric Corporation is hectically searching for a new source of natural gas. The IEC has issued an international tender looking to import liquefied natural gas, expecting to pick up some $800 million worth by December 1, 2012.)
Al Ahram agrees that “despite both sides claiming this was just a business deal gone sour, against the backdrop of growing discontent and following the exchange of heated statements, it has become apparent that the actions of the neighboring states are political.”
Al Ahram goes on to cite a 2010 Egyptian Supreme Administrative Court decision overruling a 2008 Administrative Court decision in favor of terminating the natural gas deal. The argument for the overruling was that the lower court did not have the authority to infringe on the government’s sovereignty.
In other words, the deal is officially not purely economical, and the decision to continue or stop the deal is considered by officials to be a political issue, linked to Egyptian national security.
But Al Ahram goes on to argue that the broken gas deal has not been the only source of tension between the two countries this week.
On April 21, South Sinai Governor Khaled Fouda accused Israel of trying to harm tourism in the Sinai. He was critical of a call by Israel’s anti-terrorism unit on Saturday, urging Israelis who were on holiday in the Sinai peninsula to leave immediately, for fear of kidnapping attempts and terrorism.
Governor Fouda refuted Israel’s claims, saying they were nothing more than rumors. The obviously frustrated Fouda said Israel does this whenever Egypt’s tourism industry sees an improvement. In his opinion, as soon as occupancy rates at Sharm El-Sheikh hotels reached 65 per cent, Israel released its “irresponsible statement.”
But Prime Minister Benjamin Netanyahu refuted those accusations when he said on Tuesday that Egypt’s Sinai peninsula had become a “kind of Wild West” overrun by militants, terrorists and arms smugglers. Foreign Minister Avigdor Lieberman even suggested Israel should post more troops along the border with Egypt.
Egypt’s military ruler, Field Marshal Mohamed Hussein Tantawi, was not happy. “Our borders, especially the northeast ones, are inflamed,” he admitted, but then added an angry warning: “We will break the legs of anyone trying to attack us or who come near the borders.”
Even if Israel were to discount much of that belligerent statement as intended for internal consumption, the sentiment is nevertheless authentic. Sad as it may sound, despite all the hope to the contrary, the Camp David peace treaty has not matured over the past 30+ years to the point where the occasional disagreement could not threaten its very existence. We may be looking these days at the beginning of the end of that treaty.
But those seeking positive signs for the future of the Israeli-Egyptian peace can point to the report this week about the Egyptian army preventing prevented a local group of Bedouins from defacing an IDF memorial in the northern Sinai Peninsula. According to Israel’s Army Radio, the Egyptian military deployed armored vehicles near the memorial, to prevent the Bedouins from reaching it.
Stay tuned…Yori Yanover