Egyptian Court Bans Natural Gas Exports to Israel

Cairo sells Israel 1.7 billion cubic meters a year; gov't has ignored court rulings in past.

A Cairo court on Tuesday overruled the Egyptian government's decision to allow exports of natural gas to Israel, judicial sources said, although there was no word on whether or when the government would act on the ruling.

The Egyptian administrative court accepted a challenge to the decision filed by a group of lawyers opposed to the exports, arguing that the 15-year fixed-price agreement signed between Egypt and Israel in 2005 lacks any mechanism for Egypt to adjust prices to reflect current market conditions.

Egyptian natural gas began flowing to Israel through a pipeline for the first time in May under an agreement signed in 2005 with the East Mediterranean Gas Co (EMG) for the supply of 1.7 billion cubic meters a year over 20 years.

Some Egyptian leftists and Arab nationalists oppose the sale of gas to Israel, which fought four wars with Egypt between 1948 and 1973 before signing a peace agreement in 1979.

Former Egyptian diplomat Ibrahim Yousri, who started an anti-government campaign with other activists this year called No For Gas Catastrophe, described Tuesday's ruling as a victory for the nation that protested gas exports to Israel.

In response the Israeli Ministry of National Infrastructure expressed Israel's confidence that the political agreement between the countries' governments will remain in force in keeping with the memorandum of understanding the two countries signed in 2005. Additionally, the Israeli government stated that gas shipments from Egypt, which began in March, had not stopped.

The court's ruling is subject to appeal in a higher administrative court and the Egyptian government sometimes ignores court rulings it does not like.