Egypt General Petroleum Corp. announced on Wednesday it planned to retroactively increase the price of natural gas sold to Israel, the World Tribune reports.

Officials said Cairo's interim junta has already informed Jordan that Egyptian gas would increase from $3 per million btu to up to $7. They said the increase reflects that of the global market.

Egypt also supplies Israel with gas, but the announcement of a price hike was delayed prior to negotiations over the new prices. Israel purchases Egyptian gas at between $4.50 and $5 per btu.

Egypt's Minister of Oil Abdullah Ghorab on Tuesday claimed Israel is paying $3 per BTU, which he described as "a price adjusted to average world prices." Ghorab did not explain the discrepancy between the global market, his figure and the actual prices Israel is paying.

Egypt General Petroleum Corp. Vice President Toni El-Wardani reported that he had reached understandings with the East Mediterranean Gas Co. Ltd. (EMG) to raise the price.

Israeli businessman Yosef Maiman owns 20.6% of EMG through Ampal-American Israel Corporation and his private company Merhav MNF Ltd., and Israeli institutional investors own 4.4%.

The agreement involves changing the price retroactively to 2008 and will therefore require approval from the Egyptian Supreme Court before being implemented.

In February 2010 the Egyptian Supreme Court annulled a previous ruling banning the export of Egyptian natural gas to Israel, saying it has no jurisdiction over cases of the kind which involve state sovereignty.

The court did, however, demand the government set a mechanism to determine the amount and price of natural gas it plans to send abroad after national market needs have been met.

Gas started flowing to Israel via pipeline for the first time in May 2008 under an agreement signed in 2005 for the supply of 1.7 billion cubic meters a year over 20 years.

Egypt only recently resumed pumping gas to Israel and Jordan following damage done to the pipeline by terrorists during Egypt's popular uprising earlier this year that saw the ouster of long-term President Hosni Mubarak.

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