Jerusalem, Dec 03: Israel is close to signing a 15-year contract for a USD two billion supply of Egyptian natural gas, but last minute demand by Cairo for a Letter of Credit is delaying the deal. Egyptian Oil Minister Sameh Fahmi told Israeli Minister for national infrastructures Joseph Paritzky in Rome yesterday that that 80 per cent of the deal has been agreed to and 20 per cent remains open.
"We're waiting for your letter of credit to move the deal forward. You have to be more flexible," Fahmi told Paritzky, Israel's business daily Globes reported.
Paritzky has apparently rejected the Egyptian government demand, arguing that governments should trust one another.
Bank fees for a letter of credit would raise the cost of the deal by 3-4 per cent, worsening Israeli Electric Corporation's (ICE) multi-million dollar debt and aggravating its credit problems with Israeli banks, said Globes.
Bureau Report