Egypt has signed a $500m settlement with state-owned Israel
Electric Corp over a defunct natural gas deal, the Egyptian General Petroleum
Corporation (EGPC) and Egyptian Natural Gas (EGAS) said in a statement.
The statement said that under the
agreement signed on Sunday, Egypt will pay the amount over a period of
eight-and-a-half years in exchange for the Israeli company dropping all other
claims resulting from a 2015 arbitration decision.
The International Chamber of
Commerce in 2015 ordered Egypt to pay Israel Electric about $1.8bn in
compensation after a deal to export gas to Israel via
a pipeline collapsed in 2012 after attacks by fighters in Egypt's Sinai
Peninsula.
Egypt appealed the decision and
began discussions on a settlement. The EGPC and EGAS statement said the
agreement was reached with government support and as part of efforts to ensure
a "conducive investment environment".
Israel's Delek Drilling and its
partner Noble Energy signed a landmark deal early last year to export $15bn in
natural gas from Israeli offshore fields Tamar and Leviathan to a customer in
Egypt.
A Delek Drilling executive said on
June 2 that the company hopes to begin commercial sales of natural gas to Egypt
by the end of this month. Israeli officials called it the most significant deal
to emerge since the neighbours made peace in 1979.
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