Israel to sell back gas to Egypt at $12b profit - report

Israel could make a 600% return on the resale of gas to meet a shortage in Egypt.

Egyptian daily "Al Shaab" reports that the Egyptian government is seeking to buy back 1.5 billion cubic meters of natural gas sold to Israel as part of the deal signed in 2005, under US pressure, and whose price per cubic meter was set at a level that in retrospect was significantly lower than the market price.

Anonymous sources told "Al Shaab" that internal discussions at Egypt's Ministry of Petroleum and Mineral Resources determined that at least half the natural gas sold to Israel under the deal would have to be repurchased at $14 billion, even though it was sold for $2 billion.

In January, Egypt's minister of petroleum said that Egypt would have to import gas to deal with a severe shortage created in its reserves and to meet increased household and industrial demand.

In recent weeks, the heat wave that struck the region has caused frequent power outages and water systems to be shut down in Egypt, resulting in demonstrations against the government. Demonstrators are demanding immediate imports of natural gas. At the same time, today's report has infuriated people over the government's intention "to pay Tel Aviv $12 billion" for goods that originated in Egypt.

Israel's Ministry of Finance has declined to comment.