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Industrial Source: Egyptian-Israeli Gas Deal Almost Done

The prolonged negotiations between Israel and Egypt over a 15-year natural gas purchasing agreement will probably be signed in a few weeks.

A reliable source in the Israeli energy industry told The Media Line (TML), that despite a report in the Israeli financial daily Globes, the last round of negotiations did not hit a dead-end.

Israel Electric Corporation (IEC) is looking to purchase approximately 25.5 billion cubic meters of Egyptian natural gas, valued at $1.5-2 billion.

The gas will be transferred through a pipeline from Egypt to Israel. According to the above mentioned Globes report, IEC refused the Egyptian government’s demand to provide bank guarantees worth up to $200-300 million.

The source in the Israeli energy industry told TML the bank guarantees requested are less than what was reported. He added IEC’s management board understands the business logic behind the request, and will eventually agree to it. He assumed the deal will be signed in two to four weeks.