Egypt in Israeli Gas Fine Squeeze / Israel in Egypt Gas Discovery Export Clamp

http://www.timesofisrael.com/israel-may-forgive-half-of-egypts-1-7b-gas-fine/?utm_source=dlvr.it&utm_medium=twitter   Times of Israel Israel may forgive half of Egypt’s $1.7b gas fine Reported move would push along stalled talks over energy imports, amid steadily warming ties By Times of Israel staff May 19, 2016, 3:05 pm  [PHOTO] Flames rise from a gas pipeline explosion in el-Arish, Egypt in July. The pipeline that transports fuel to Israel and Jordan has been attacked more than a dozen times since the fall of former president Hosni Mubarak. (photo credit: AP/File) Israel may let Egypt slide on nearly $900 million from a fine over an energy deal, as Jerusalem courts warmer business ties with Cairo, according to a report this week. Egypt owes Israel $1.76 billion for a 2015 court judgment that found Cairo violated an agreement to supply natural gas. Egypt cut off talks to import Israeli natural gas after the ruling, but two officials close to the case quoted by Bloomberg Wednesday said Israel may forgive half the fine, paving the way to reopening negotiations. According to Bloomberg, payments would be spread over 14 years and talks are still underway. There was no official confirmation of the report, which comes as Israel has been signaling other moves to warm up to Cairo, including recently upgrading embassies in Cairo and Jerusalem. On Sunday, Israel is expected to return two Bronze-Age wooden anthropoid sarcophagus lids to new Egyptian Ambassador to Israel Hazem Khairat at a Foreign Ministry ceremony on Sunday, four years after they were discovered smuggled into the Jewish state. The $1.76 billion ruling, made by three arbitrators in a closed session in December, ended 3.5 years of deliberations in which the Israeli Electric Corporation was claiming over $4 billion in damages stemming from Egypt canceling their bilateral gas deal in 2012. Egyptian government-owned gas companies EGPC and EGAS were expected to foot the bill. In response, Egypt’s Oil Ministry ordered the gas import talks frozen until after the case is appealed and the ruling is clarified, according to Bloomberg at the time. Israel is set to become a major gas supplier with the discovery of a massive offshore field and has looked for regional buyers, including Jordan and Egypt. Before 2012, Israel imported natural gas from Egypt, though the pipeline, running through the restive Sinai Peninsula, was dogged by frequent sabotage. The deal, initially slated to last 20 years, was finally canceled by Egyptian authorities following the 2012 ouster of president Hosni Mubarak and election of Muslim Brotherhood president Mohamed Morsi. Morsi was ousted in 2014, and ties between Israel and Egypt, never warm, have steadily improved since.  [comment:  Pres = Abdel Fattah el-Sisi  / Launched 2013 coup d'etat removing Mohamed Morsi in aftermath 2013 protests. From Egypt's military class.  Won in election boycotted by most political parties & Muslim Brotherhood.  Sunni.  ] http://www.timesofisrael.com/israel-may-forgive-half-of-egypts-1-7b-gas-fine/?utm_source=dlvr.it&utm_medium=twitter   Info from:   Abraham Rabinovich http://freebeacon.com/national-security/israel-announces-discovery-of-offshore-gas-field/ SUMMARY Dec. 2014 Israel announces discovery of offshore gasfield. Three located in Israeli waters in past five (5) years. Two larger fields:  2009 & 2010. Expected to serve bulk of Israel gas needs. Meanwhile the following are in urgent need of energy supplies: *Egypt *Palestine Authority (West Bank ?) *Jordan Until 5 years prior, Israel almost entirely coal & energy import dependent. Sites = potential Hamas (Gaza) & Hezbollah (Lebanon) targets. Israel has a policy of massive overkill as a deterrent to future attacks, so Hamas & Hezbollah may not be highly motivated to target drill sites. Another motivator is that they may also wish to drill and would not wish to risk retaliation.  LOL Info from:   Abraham Rabinovich http://freebeacon.com/national-security/israel-announces-discovery-of-offshore-gas-field/ source http://www.timesofisrael.com/top-10-things-to-know-about-israels-natural-gas/ SUMMARY   2009 - Leviathan - 90m Haifa - 450 bn cubic meters - rights negs Nov 2015 2009 - Tamar - 90m Haifa - 240 bn cubic meters - rights negs Nov 2015 Distribution:  Natgaz (Israel Natural Gas Lines) 2015 - Israel 60% electricity from natural gas 2015 - solar energy = 2% of Israel electricity Benefits: natural gas less pollutant than oil or coal / greenhouse reduction energy independence for Israel MASSIVE BACKLASH environmental groups hold massive protests re gas deal Tel Aviv protest over 10,000 Nov. 2015 Green Course one of those groups gas deal deemed dangerous for Israel allows for quick export of Israel gas (potentially leaving Israel w/out gas) gas deal deemed “organized robbery” govt despoiling greatest national resource dividing among a group of magnates monopoly that is selling Israeli gas back to Israelis govt puts out as concessions for:  Israel’s geostrategic standing Israelis don't buy that:  Bibi has turned Israel into country with:     -- most expensive housing in West     -- most expensive cars in West     -- most expensive food in West     -- most expensive gas in West -- Bibi pushed through deal -- public outcry & inter-govt. conflicts ensued -- Bibi forced to put to Knesset vote -- Knesset passed deal (59 / 51) -- approval (at time article) required from Anti-trust Commission / or economy minister -- economy minister resigned, refusing to be first to invoke A.52 -- LOL ... Bibi's taken over -- duopoly between Nobel and Delek Bill Clinton -- Bill Clinton has lobbied for Noble Energy in past directly w/ Bibi-- Noble Energy spox denies Clinton a paid lobbyist for Noble-- 2009  Leviathian discover prompts calls to renegotiate tax breaks exploration -- Due to size of discovery, Israel must renegotiate -- 2010 Bill Clinton complains to Bibi 2010 that Israel cannot tax US business retroactively whenever they feel like it -- 2015 - Clinton speaks at Rabin assassination mem. / gets booed by crowd -- re his lobbing for Noble Energy Egypt -- Italian company exploration off coast Egypt -- 'supergiant natural gas field discovery -- LARGEST EVER IN MEDITERRANEAN -- twice the size of Israel's offshore fields -- Egypt no longer potential buy of Israel energy Domestic Israel -- market Israel & Palestine depend on Israel infrastructure -- already using gas / domestic increase not substantial per annum -- DEVELOPERS & PARTNERS NEED *EXPORT MARKET* -- Israel & Westbank too small to justify expensive development -- companies will only invest in development if they can be assured of STABLE EXPORT MARKET -- talk of joint Italy-Egypt-Israel agreement -- other option:  TURKEY -- Turkey = economic sense but political hurdles (strained relations) Israel single gas pipeline from Tamar (2015) -- more pipes crucial to develop (for additional fields) -- single pipeline problem (monopoly) + in event of damage source http://www.timesofisrael.com/top-10-things-to-know-about-israels-natural-gas/ -------/\/\/ Delek Delek Group Israeli conglomerate and one of Israel's largest majorly owned by Yitzhak Tshuva EGYPT needs to get by until the offshore gas drilling is in operation (2-3 years) EGYPT ECONOMIC SHORTFALL 1.  SAUDI ADVANCE - $22 BILLION 2.  USA ADVANCE - pending 3.  IMF ADVANCE - pending http://nationalinterest.org/feature/will-sisi-squander-his-chance-fix-egypts-economy-16237 $22 billion Saudi aid   Saudis visit Egypt April Pres. Abdel Fattah el-Sisi in damage control mode crisis:     1.  Egypt transferring sovereignty of x2 Red Sea islands to Saudi Arabia     2.  Saudis providing enormous 'economic aid' package to Cairo (ie credit) -- islands possibly sold -- without $22 billion Saudi aid, Egypt on way to economic collapse -- declining tourism -- declining Suez canal revenues [why? is shipping avoiding?] -- Islamist insurgency (ISIS-led) -- foreign reserves dwindling dangerous levels -- 9% annual inflation rate (deemed big) -- over 13% unemployment (not that big, in my view) -- annual budget deficit - 12% -- military sucks up large part of economy / 30% -- food & energy subsidies @ 20% -- bloated bureaucracy + food & energy subsidies = 80% govt budget p.a. -- babies born every 19 seconds - 2.6% replacement rate -- Egypt population poised to double to 180 million by 2050 -- almost half of Egyptians live on $2 day -- $20 billion goes right back to the Saudis in petroleum projects / so it's credit credit -- funding covers 5 years -- Italian discovered offshore gas coming on in 2-3 years -- Saudi credit helps bridge funding gaps until gas happening -- Sisi may be up for tax reforms, intro VAT & capital gains -- Sisi may reduce public sector wages -- Sisi may streamline regulations (business / environment) -- 2017:  stand by for revolution in Egypt -- govt cutting energy subsidies to poor by 43% -- tax reform would enable Egypt to raise food subsidies & to lower deficit -- unknown if Sisi will take this course ... lol -- 2013:  Saudi Arabia, UAE & Kuwait $20 billion aid to Egypt -- back then Egypt did not do any of the reforms it needed to do for enduring change -- pending:     -- USA loan     -- IMF loan http://nationalinterest.org/feature/will-sisi-squander-his-chance-fix-egypts-economy-16237 COMMENT Well, this looks exciting.  But now I can't remember how I got here.  LOL Oh, Israel's forgiving maybe half of Egypt's gas contract cancellation massive kick in the nuts fine.   But Egypt was going to appeal the eye-watering fine.  Israel's got masses of gas, but Egypt having twice the gas stuffs up Israel.  Egypt was going to be a buyer until the offshore discovery ... but now it has become a competitor for customers?  Wow, this could get exciting. So Israel and Egypt are in somewhat similar circumstances:  Egypt wants out of Israeli gas supply, presumably as Egypt has huge supply source of own discovered subsequent to contact that Egypt cancelled.  Similarly, Israel has a lemon of a deal re exploration with Noble Energy, as Noble got huge tax concessions (before the giant gas discovery).  Don't fancy Egypt's chances now that Egypt has a massive off-shore gas supply, twice the size of Israel's.  Uh-oh ... Israel will eat Egypt for breakfast.   Wonder what's going to happen? Israelis are highly political:  it's incredible how big the street protests were. Bill Clinton's a creep.  Punish him, Israel.  LOL -------/\/\/ PS ... wonder if any fall-out from this could have any impact on the Israel-Egypt-US special relationship, or if this is just business? Wow, things aren't good economically in Egypt.   It's like another Ukraine, getting raped by USA & IMF ... & Saudis. Egypt population massive growth + Africa population massive growth by 2050 cannot feasibly be supported, I believe.  There's probably going to be a war or something?