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Sabotage Foreshadows Israel’s Energy Future

Pipeline explosion coincides with re-examination of Egyptian gas deal

Marc Tracy
April 29, 2011
The bombed Egyptian pipeline.(-/AFP/Getty Images)
The bombed Egyptian pipeline.(-/AFP/Getty Images)

It’s not the most consequential thing to happen in Egypt this past week—that would be, rather, Egypt’s brokering of the Hamas-Fatah deal and general new openness to Hamas and Iran (and, what do you know?, the Islamic Republic appointed its first ambassador to Egypt in three decades last week). But there was yet another explosion at an Egyptian pipeline that supplies crucial natural gas to Israel and Jordan, which authorities said was an act of sabotage; they were tipped off by the fact that the explosion was caused by TNT—really.

This came in the midst of the Egyptian prosecutor’s questioning of former president Hosni Mubarak over energy exports to Israel. (Mubarak was moved to a hospital for heart problems earlier this week.) Reports have it that Mubarak’s two sons each received a 2.5 percent cut of Israel’s 15-year, $2.5 billion deal with Egypt’s East Mediterranean Gas, inked in 2005, which allegedly set cut-market rates; two former Egyptian ministers have been accused of costing Egypt nearly three-quarters of $1 billion in selling energy to Israel on the cheap. (Until recently, Egypt supplied as much as 40 percent of Israel’s natural gas.)

All the way back in early February, when Hosni Mubarak was still president (how time flies!), Egypt expert Samer Shehata told me, “Many Egyptians would be willing to sell gas to Israel if they believed they were selling gas at international prices, as opposed to in an opaque, murky economic transaction that people seem to be left in the dark about—where no one really knows what the arrangements really are and the assumption, for good reason, is that the sale of gas is at below-market prices.” For their part, according to the New York Times, Israeli officials are okay with the new light being shed on the 2005 deal as long as the focus remains on the price of energy exports rather than the exporting of the energy itself, which at times has been controversial (including when Egypt kept the gas flowing during Operation Cast Lead). Reported the Times, “A senior Israeli official said, however, that if the investigation becomes a pretext for halting the deal for domestic political reasons, Israel would have reason for genuine concern.” Translation: That Leviathan field is sure going to come in handy!

Marc Tracy is a staff writer at The New Republic, and was previously a staff writer at Tablet. He tweets @marcatracy.