The Egyptian Government ordered its oil and gas arms to freeze talks on importing Israeli natural gas after an international arbitration court ordered the Arab world’s most populous nation to pay a fine of almost $1.73b to Israel.
Egypt will appeal the ruling by a panel at the Geneva-based International Chamber of Commerce within six weeks, Prime Minister Sherif Ismail said in an interview. The fine was imposed after arbitration between East Mediterranean Gas Co., Israel Electric Corp. and companies supplying Egyptian gas through a Sinai pipeline that was repeatedly sabotaged.
The government also ordered Egyptian General Petroleum Corp. and Egyptian Natural Gas Holding Co. to halt approvals to companies to import Israeli gas until it clarifies the ruling and the fate of the appeal, the oil ministry said in a statement.
Dolphinus, an Egyptian gas-trading company, is negotiating with partners in Israel’s offshore Leviathan field to buy as much as 4 billion cubic meters of natural gas a year for 10 to 15 years. It also signed a deal in March to import fuel from Israel’s Tamar field.
Egypt exported natural gas to Israel until it canceled the deal in 2012 as its wells became depleted and new exploration slowed. It has said that any gas import deal with Israel should include a resolution to international arbitration cases.
Israel’s TA Oil & Gas index fell 0.9 percent to 1,016.84, the lowest since Nov. 22, at the close in Tel Aviv. Avner Oil & Gas dropped 2.4 percent.
(Adds Israeli stock prices; an earlier version of the story corrected description of East Mediterranean Gas Co.)