Egypt scraps Israel gas supply deal (BBC) British Broadcasting Company) 22 April 2012 Last updated at 21:07 GMT)
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Egyptian officials say they have scrapped an agreement to supply
Israel with natural gas.
Israel received around 40% of its gas supplies from Egypt and uses it
to generate electricity.
The announcement comes after the cross-border pipeline suffered
numerous sabotage attacks which cut supplies.
Israeli Finance Minister Yuval Steinitz said the move was of "great
concern", and overshadowed peace agreements between the countries.
Egypt was the first Middle East country to sign a peace accord with
Israel, in 1979, and the deal to supply energy has been a key part of
agreements between the two states.
But the BBC´s Jon Leyne in Cairo says the gas deal is deeply
unpopular, and one of the charges against former President Mubarak is
that he sold the gas too cheaply.
Israel has insisted it is paying a fair price for the gas.
A statement from the Egyptian Natural Gas Holding Company said it was
ending supplies because the terms of its contract had been breached.
Ampal, the Israeli company which buys the gas, said in a statement
that it considers the attempt to terminate the contract "unlawful and
in bad faith", and demanded its withdrawal.
The company is using international arbitration to try to get
compensation, after supplies were interrupted following frequent
sabotage attacks on the gas pipeline across the Sinai desert in north-
There have been 14 attacks since last year´s uprising which unseated
Unrest in the area has increased over the last year partly due to
tensions with heavily-armed Bedouin tribes who live there. (© BBC
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