Petroleum official: No compensation in wake of pipeline explosion

There is no reason for the company responsible for natural gas exports to Israel to file a lawsuit against the Egyptian government, a senior Egyptian Petroleum Ministry official has said.

The East Mediterranean Gas Company (EMG) experienced financial losses as a result of the government's decision to suspend pumping operations.

Authorities cut supplies to Israel after bombings at the Egyptian gas pipeline in the Sinai in February and April. Two companies holding shares in EMG threatened international arbitration against the government if suspension continued. 

The ministry official told Al-Masry Al-Youm that Egypt was not responsible for the suspension of gas exports, which was caused by "force majeure" event.

He said force majeure events include sabotage bombings, natural disasters and basic problems hampering the operation oil producing wells, all of which are stipulated in the contract agreement.

The official, who requested anonymity, said that while the EMG partners have the right to protest against the suspension of pumping operations and the losses arising from it, it should be recognized that the government announced its commitment to the contract.

He added that the Petroleum Ministry is working to repair the pipeline.

The official confirmed that the ministry would not be paying any compensation to the EMG partners or to the countries benefiting from export operations, including Israel, Jordan, Syria and Lebanon, as Egypt was not responsible for the suspension of pumping operations.

He explained that if the government paid compensation, such a move would confirm Egypt’s responsibility for something it is not guilty of, which would then give these parties a legal basis by which to sue Egypt.

Translated from the Arabic Edition

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