Egypt’s Natural Gas Holding Company has scrapped the contract to ship gas to Israel because of violations of contractual obligations.

Egypt’s Natural Gas Holding Company has scrapped the contract to ship gas to Israel because of violations of contractual obligations.

The accord was "annulled on Thursday with the East Mediterranean Gas Co (EMG) which exports gas to Israel because the company failed to respect conditions stipulated in the contract”, the Head of the company, Mohamed Shoeb, said, adding the decision was not political.

“This has nothing to do with anything outside of the commercial relations”, Shoeb said, noting that the Zionist entity has not paid for its gas in four months.

For its part, Israel Finance Minister Yuval Steinitz said on Sunday the unilateral Egyptian announcement was of "great concern'' politically and economically.

"This is a dangerous precedent that overshadows the peace agreements and the peaceful atmosphere between Israel and Egypt,'' he said in a statement.

Israeli foreign ministry spokesman, Yigal Palmor, also denied the Zionist entity was not paying.

Israel relies on Egyptian natural gas for 40 percent of its supplies to produce electricity.
The 2005 gas export deal with the Zionist entity has always been controversial in the Arab world's most populous country. It was the largest trade deal between the two sides.

Gas pipeline to Israel has come under attacks by militants for 14 times since President Hosni Mubarak was ousted following a popular uprising last year.