By Adam Morrow
CAIRO, Feb 29 2008 (IPS)

On Monday, Egypt began pumping natural gas to Israel in accordance with an energy accord between Cairo and Tel Aviv. While the government defends the move as being in the country's best interest, opposition figures decry the notion of economic cooperation with Israel, especially in light of the latter's ongoing siege of the Gaza Strip.

"We oppose any agreement with this rapacious entity Israel," Essam al-Arian, a leading member of Egypt's Muslim Brotherhood movement, which controls a fifth of the seats in parliament, told IPS.

Amid little fanfare, natural gas began flowing from the Egyptian coastal town of al-Arish to the Israeli port city of Ashkelon on Feb. 18. The gas, extracted from fields in Egypt's northern Sinai Peninsula, was pumped through a recently completed, 100-kilometre submarine pipeline.

"The implementation phases of the pipeline have been completed and operational trials have begun," independent daily al-Masry al-Youm reported Feb. 25. The paper went on to note that the full-scale export of gas to Israel would begin in early March.

The move comes in accordance with a memorandum of understanding between Cairo and Tel Aviv signed in mid-2005. The agreement allows the Cairo-based East Mediterranean Gas (EMG) to sell 1.7 billion cubic metres of Egyptian natural gas annually to the Israeli state-run Israel Electric Corporation for a period of 15 years.

EMG is a private energy consortium jointly owned by Egyptian businessman Hussein Salem and the Israeli Merhav Group.

The sale follows years of negotiations that were frequently delayed, as Israel's aggressive policies in the West Bank and Gaza Strip made Egyptian participation in the scheme politically awkward for Cairo. In an indication of its political sensitivity, the commencement of exports received scant coverage in the state press.

The government justifies the deal on economic grounds, pointing to recent estimates that put Egypt's total gas reserves as high as three trillion cubic metres. According to petroleum ministry figures, Egypt's total natural gas production last year reached some 62 billion cubic metres, more than a quarter of which was sold on international markets.

"The government sees the sale as an economic rather than political decision," Emad Gad, analyst at the semi-official al-Ahram Centre for Political and Strategic Studies and expert in Israeli affairs, told IPS. "Cairo also wants to send a message to the U.S. that it enjoys a stable peace with Israel and is ready for economic cooperation."

The gas deal does not represent Egypt's only recent economic dealings with the Hebrew state.

In late 2004, Cairo and Tel Aviv signed a Qualified Industrial Zones (QIZ) agreement, which gives Egyptian exporters duty-free access to the U.S. market. To qualify for inclusion in the treaty, which was renewed last October, exported goods must contain a set percentage of Israeli content.

Egypt is one of the few Arab states, along with Jordan and Mauritania, to officially recognise Israel. Nevertheless, bilateral cooperation remains severely hampered by Egyptian popular disapproval of Israeli policies, particularly when it comes to the issue of Palestine.

Within the last two years, public opinion has further hardened against Israel in light of the latter's ongoing blockade of the Gaza Strip, which shares a 14-kilometre border with Egypt. The siege has deprived the territory's roughly 1.5 million inhabitants of the most basic necessities – including fuel – and has exposed Egypt to the risk of a full-blown humanitarian crisis on its doorstep.

"The timing is outrageous," said al-Arian. "How can Egypt sell gas to Israel when Palestinians in the Gaza Strip are being deprived of fuel, food and medicine?"

Answering those who would uncouple economic from political considerations, he said: "This rationale is unacceptable. Every country links its political interests with its economic interests."

The gas deal has run up against fierce opposition in parliament. Some opposition representatives have even accused the government of providing gas to Israel at marked-down prices.

Last month, Muslim Brotherhood MP Sabri Aamer said the petroleum ministry intended to charge Israel three dollars per cubic metre of gas while international prices were closer to 12 dollars per cubic metre. "Why are we offering subsidised gas to the Israelis?" Aamer was quoted as saying in the assembly.

Although the precise selling price has yet to be officially divulged, Gad downplayed the likelihood that Egyptian gas would be sold at a discount.

"I seriously doubt Cairo would sell natural gas at reduced prices," he said. "But, unfortunately, the government's been very tight-lipped about the deal – as it always is on issues relating to Israel – so exact details remain vague."

In any event, Israel will not be the only recipient of Egyptian natural gas in the immediate future. Next month, Egypt will also begin exporting gas to Syria as part of a wider Arab Gas Pipeline Project which aims to distribute Egyptian natural gas to buyers in Jordan, Syria and Lebanon.

For al-Arian, however, the sale of gas to Arab neighbours will not atone for concurrent energy sales to Israel.

"There's no correlation," he said. "The export of gas to Syria and Lebanon won't blunt popular opposition to the deal with Israel."

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