The worldwide arbitrators ordered Egyptian companies to pay €1.5 billion.
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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 utility said it suffered heavy damages after gas supplies were halted and it was forced to buy more expensive fuel to generate electricity, raising its costs.
The two state-owned firms said they had been instructed by the Egyptian government “to suspend negotiations with [Israeli] companies over the import of gas from Israel and the award of any import approvals until the legal situation regarding the arbitration ruling and the results of the appeal are clarified”.
He also said, “The State of Israel sees major importance with overall defense, economic and energy relations with Egypt and hopes that through close bilateral relations, we can continue moving forward on the subject of gas, in the short term”.
Falling oil and gas production coupled with rising consumption have turned Egypt from an energy exporter into a net importer.
Egyptian Prime Minister Sherif Ismail said on Sunday an appeal would be filed within six weeks. Egypt exported natural gas to Israel until it canceled the deal in 2012 as its wells became depleted and new exploration slowed.
Dolphinus is a company that represents non-governmental, industrial and commercial consumers in Egypt.
Egyptian security stand in the vicinity of flames following an attack by saboteurs on an Egyptian gas pipeline on July 12, 2011, at al-Arish in the north of the Sinai peninsula.
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Egypt has said it still wants to import Israeli gas despite Italy’s ENI discovering the large Zohr gas field off Egypt’s coast in August.
