Egypt Scraps Gas Accord with Israel

Egypt has scrapped a 2005 gas export deal with Israel, which relies on Egyptian natural gas for 40 percent of its supplies to produce electricity, the chairman of a government holding firm said on Sunday.

The accord was "annulled on Thursday with the East Mediterranean Gas Co (EMG) which exports gas to Israel because the company failed to respect conditions stipulated in the contract," Mohamed Shoeib told Agence France Presse.

The sale of gas to Israel, which signed a peace treaty with Egypt in 1979, has always been controversial in the Arab world's most populous country.

A pipeline in the Sinai Peninsula that has been used to supply Egyptian gas to Israel and Jordan was hit by a bomb blast on April 9, in the 14th such attack since the uprising which toppled president Hosni Mubarak in February 2011.

Egypt has been gripped by security-related problems since the revolt.

Gas deliveries to Israel, agreed under Mubarak, have come under heavy criticism in Egypt. Israel generates 40 percent of its electricity using natural gas, and Egypt provides 43 percent of its gas supplies.