December 6, 2015 / 9:41 AM / 4 years ago

Egypt to pay Israel Electric $1.76 bln for halting gas supplies

JERUSALEM, Dec 6 (Reuters) - Israel Electric Corp , Israel’s state-owned electric utility, said on Sunday Egyptian natural gas companies will pay compensation of $1.76 billion for halting gas supplies.

Egypt had been selling natural gas to Israel under a 20-year agreement, but the deal collapsed in 2012 after months of attacks on the pipeline by militants in Egypt’s Sinai peninsula.

Egypt Mediterranean Gas, the company that oversaw the gas deal, sued for $4 billion in damages, but an international arbitrator awarded Israel Electric $1.76 billion plus interest and legal expenses, the Israeli company said in a statement.

The company said it had suffered heavy damages after gas supplies were halted and that it was forced to buy more expensive fuel to generate electricity, raising its costs. (Reporting by Ari Rabinovitch and Steven Scheer, editing by Larry King)

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