The sale of gas to Israel at cheap prices was choreographed by Hosni Mubarak, Omar Suleiman said in his witness account regarding the charges against Mubarak and business tycoon Hussein Salem of wasting public money.
During the investigations, former intelligence chief and vice-president Suleiman said Mubarak had a 20-year friendship with Salem. Mubarak told Salem to relinquish his company to the public sector and establish a new one in partnership with the Egyptian General Petroleum Corporation (EGPC) in order to export gas to Israel, Suleiman added. The company was named EMG. Suleiman said Salem was not happy about taking such a step, as having normal relations with Israel would tarnish his public image.
He added that Mubarak chose Salem because the latter had previously dealt with Israeli investors during the construction of a petroleum refinery for a company named MIDOR, which the EGPC later took ownership of.
The company, in which Salem was a partner, began exporting gas to Israel in 2008. Salem left it in 2009.
In 2003, Suleiman said a memorandum of understanding was signed between the Egyptian and Israeli governments to supply Israel with gas through the private sector. A contract was signed between EMG and the Israel Electric Company, whereby the former would sell 7 billion thermal units of gas to Israel annually for 15 years. The price of one thermal unit was set at around US$2.25 dollars.
Suleiman said a commitment to the 1979 peace accords was the reason Egypt signed a gas contract with Israel.
Egypt exported 2 million tons of petroleum to Israel at international prices in compensation for the latter’s withdrawal from Sinai. Petroleum exports began in 1984, two years after Israel’s withdrawal in 1982, and continued until 1998, when Egypt began consuming all of its production and was thus unable to export. Natural gas was then considered as an alternative, after the former minister of petroleum and Prime Minister Atef Ebeid discussed the matter.
Egypt's intelligence played a role in the negotiations between the Egyptian and Israeli governments that preceded the signing of the memorandum of understanding. Its role was to facilitate the implementation of Egypt’s decision through communicating with the Israeli side.
