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Egypt ex-oil minister cleared of Israel gas deal charges

Prosecutors said that Fahmi and his associates robbed Egypt of $714m
Sameh Fahmi was sentenced to 15 years in prison in 2012, but an appeals court ordered a retrial a year later (AFP)

An Egyptian court has cleared former petroleum minister Sameh Fahmi of corruption charges linked to a highly controversial gas deal with Israel, a judicial source said on Saturday. Five other former ministry official were also cleared, the official told Anadolu Agency.

The case is extremely politically sensitive, with Fahmi and his associated having been accused of pocketing millions. The beleaguered deal provided gas to Israel at below market prices, which Fahmi’s public prosecution in 2012 claimed cost Egypt over $714 mn in lost revenues.

The true cost could be even higher. Energy Analyst Mika Minio-Paluello Platform, who has investigated the deal, claims that the cost could be anywhere between $500 mn and $1.8 bn. When other suspect deals – including those signed with Jordan and Spain – are taken into account the true cost could be as high as $11 bn, the analyst with energy think tank Platform told Al-Jazeera in a documentary on the deal, aired last year.

Anger over perceived impropriety was one of the key grievances put forward by protesters during the 2011 revolution that eventually led to the overthrow of former President Hosni Mubarak.

After Mubarak’s ousting, Fahmi, who had served as his petroleum and mineral resources minister for 11 years, was arrested and charged with corruption.

In 2012, the Cairo Criminal Court sentenced him to 15 years in jail for exporting natural gas to Israel at a price below market rates and squandering public funds, a judicial source told the Anadolu Agency on condition of anonymity.

The other five ministry employees were all handed down jail terms, ranging from three and 10 years. Business tycoon and East Mediterranean Gas Company (EMG) founder Hussein Salem, who was a close associate Mubarak and fled Egypt after the revolution, was also sentenced to 15 years in jail albeit in abstention. The defendants were all ordered to pay fines of 2.03 billion Egyptian pounds ($300m).

However, the case soon began to unravel.

In 2013, Egypt's top appellate court appealed the verdict and ordered a retrial before a different court, with Fahmi being released from custody in March 2013 pending a retrial which has been delayed numerous times.

In November of 2014, a court cleared ex-President Hosni Mubarak of corruption charges related to gas exports to Israel.

The court also dropped another corruption charge against the ex-President, his two sons, Alaa and Gamal, and Salem.

But EMG’s Salem, who also holds Spanish nationality and has not returned to Egypt since 2011, has not been cleared because he was not in the country to file appeal papers.