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Daily Israel Report

Egypt Fumes Over Israel's Energy Plans

Israel has beaten Egypt to the punch in its bid to connect to the European electrical grid, leaving pundits in Cairo gnashing their teeth.
By Gabe Kahn.
First Publish: 2/2/2012, 7:15 PM

Asdod Marina
Asdod Marina
Avraham Krichevsky

Egypt's media went into a frenzy over Israel's plans to build a major electrical plant in Ashdod, in what some pundits in Cairo claim is an attempt to undermine Egypt's plans to export electric energy to Europe.

Calling the project Israel's "High Dam," after Egypt’s major Nile dam and electrical power station, the reports note that the project will receive joint European-American funding. The project will both aid Israel in reducing its dependence on gas imports and allow the Jewish state to export electricity to Cyprus and Europe.

The Israel Electric Company (IEC) and Greece's DEH Quantum Energy are expected to sign the MOU in a few weeks' time. This will lead to a feasibility study, which will be followed – if all goes well – by ratification of the project by the Israeli and Cypriot governments, in the course of 2012.

The cable will be 270 km. long. Another cable will connect Cyprus and Crete, which is part of the Greek electricity grid. An MOU for the longer cable has already been signed between Greece and Cyprus.

According to the Egyptian newspaper Rose al-Youssef, both former Egyptian president Hosni Mubarak and businessman Hussein Salem, owner of the company in charge of exporting Egypt's gas, who is currently a fugitive in Spain, knew about this project when they signed deals with the Israeli government.

The closeness of Israel to Cyprus and Greece helped make the High Dam project more feasible, since Israel will be linked to the Cypriot and Greek electricity networks with 53,000 kilometers of connections under the sea to European shores, and is later expected to extend for another 600 kilometers inside European territories.

The electricity generated by the High Dam will provide more than 10 European countries with an electric power estimated at 2,000 megawatts and will reach 4,000 megawatts by 2020.

Israel made information about the dam project available to the majority of European countries involved, but did not notify Egypt, Rose al-Youssef claimed.

Blaming Mubarak for Israeli business success and Egyptian failure in the energy race has been a common theme among radical anti-regime protesters who have also called for Egypt to annul the 1979 Egypt-Israel peace treaty.

Egyptian authorities, seeking to tap anti-Israel sentiments along the Nile and deflect criticism from their own failures, have also said they want to renegotiate the Mubarak era deal to export gas to Israel and retroactively raise the rates the Jewish state pays.

The Sinai gas pipeline that sends Jordan and Israel natural gas from Egypt has been attacked over a dozen times by Islamic terrorists since the fall of the Mubarak regime and has experienced numerous lengthy periods of downtime.

Amid increased costs from being forced to purchase diesel fuel for electrical generation plants, Israeli officials have stepped up their off-shore gas field development projects in the waters between Cyprus and Israel.

Nicosia and Jerusalem have also engaged in closed door negotiations for joint development projects of the gas fields, as well.