Egyptian gas supply partially restored

The Ministry of Energy and Water Resources refuses to confirm the report.

Gas supply from Egypt was restored yesterday, although only partially. Ministry of Energy and Water Resources spokesmen declined to confirm the news following a decision to try to keep the renewed gas supply a secret. In the past year, numerous explosions of the pipeline have caused disruptions in gas flow.

The explosions of the Sinai gas pipeline were apparently perpetrated by Bedouin tribes that had demanded protection and transportation fees from the Egyptian government, an investigation by "Globes" revealed two weeks ago. The Egyptian government is currently refusing to bend to Bedouin demands, yet is also not hurrying to finish building facilities to protect the pipeline from future attacks.

The Sinai pipeline supplies gas to Israel, Jordan, Lebanon, Syria and to Egyptian factories in El-Arish. There were at least ten attacks at different points along the pipeline in 2011, which caused disruptions in gas flow for more than 200 days. Israeli officials believe that the cumulative damage to the Israeli economy could reach NIS 15 billion, if gas flow from Egypt is not fully restored until mid-2013, when Israel will begin benefitting from natural gas from the Tamar reserve.

Costs stem from the Israel Electric Corporation (IEC) (TASE: ELEC.B22) being forced to purchase expensive diesel and industrial fuel in place of the gas shortfall, for which the Israeli consumer will pay the price through electricity price increases that will apparently be staggered over several years.

Published by Globes [online], Israel business news - - on January 18, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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