Press Releases: 12/15/14
Al Jazeera America (1)
Al Jazeera America Presents “EGYPT’S LOST POWER”
How did Egypt end up in the grips of an energy crisis? And how did a deal with Israel cost Egyptians $11 billion in lost revenue?
Airing Wednesday, December 17th at 10pm ET/7pm PT
“Egypt mismanaged its gas industry. It raises the possibility that Israel, in contradiction to the history of the energy relations, will be supplying Egypt.” –former Israeli Ambassador Oded Eran
Egypt is facing a gas crisis despite it having been, until as recently as 2010, one of the largest gas producing countries in Africa. How did it reach this point?
In this special investigative documentary, “Egypt’s Lost Power,” airing this Wednesday, December 17th at 10pm ET/7pm PT, award-winning journalist Clayton Swisher from Al Jazeera’s Investigative Unit examines the hidden story of Egyptian energy, including the decades of crooked deals that undermined the country’s energy sector, and the tycoons who made billions from corrupt energy deals approved by the Egyptian state.
“Egypt’s Lost Power” tracks the role of energy in one of the most important relationships in the Middle East – Israel’s peace accord with Egypt – and uncovers how allegations of corruption, in addition to the political controversy surrounding the gas deal with Israel, contributed to the uprising that engulfed Egypt in January 2011.
Who are the Players?
In “Egypt’s Lost Power,” we learn about the architects of Egypt’s energy deals: Hussein Salem, an Egyptian businessman and former intelligence officer once convicted of fraud in the U.S.; his protégé Sameh Fahmy, who would become Egypt’s petroleum minister; and former Israeli Mossad agent Yossi Maiman, who served as the broker for selling Egypt’s gas.
With Israeli political support as well as one more crucial link – Salem’s relationship with former Egyptian President Hosni Mubarek – these men developed a series of deals that allowed Egypt to sell Israel gas at below-market rates that were unprecedented in the natural gas industry, while at the same time enriching themselves with billions.
“The presence of Sameh Fahmy as minister defines a new era for the energy sector in Egypt, where the resources were managed by the Intelligence of Egypt,” Hatem Azzam, who was a member of parliament in Egypt in 2012, told Al Jazeera.
Using confidential documents obtained by Al Jazeera, energy analyst Mika Minio-Paluello calculated that Egyptian taxpayers lost possibly $11 billion through deals the government made through Hussein Salem and his associates, including contracts exporting gas to Israel and other countries.
“In the same year , gas was being exported in other countries for…vastly more, up to eight times more than what the Egyptians were receiving,” Minio-Paluello told Al Jazeera. By 2010, EMG owners Hussein Salem and Yossi Maiman “were receiving [the gas] from the Egyptians for $3 and then selling it on to the Israelis for $4.50 and basically pocketing the difference.”
What’s Happening Today?
Egypt’s energy sector is in a full-blown crisis. Years of corruption have destroyed the country’s relations with global energy companies, and Egypt is facing liabilities of $20 billion from known debts and legal cases, including claims by Salem, Fahmy and Maiman.
Al Jazeera cameras caught up with Israeli businessman Yossi Maiman as he arrived at his corporate headquarters north of Tel Aviv. “I’ll settle for $50 billion,” Maiman told Al Jazeera, of his claims against the Egyptian government.
Today, as gas shortages sweep Egypt, President Abdel Fattah el-Sisi is hoping that a clandestine deal to buy gas from Israel will secure his political future. But as revolutionaries tried to temporarily halt the gas sales, a clause in Egypt’s gas contract could have far-reaching consequences. By cutting off the gas supplies, Egypt becomes liable for damages so huge they could bankrupt the state.
It’s a powerful story about corruption and mismanagement that ultimately may have influenced the Arab Spring, hit Egyptian taxpayers and created a financial abyss for Egypt for years to come.