The deal, which is worth some $3 billion, was approved in principal on Sunday by Israeli National Infrastructure Minister Binyamin Ben-Eliezer, The Marker reported on Monday.
Under terms of the memorandum of understanding signed on Sunday, Egypt will supply natural gas to the Israel Electric Corporation in a deal brokered by the Israeli-Egyptian owned Eastern Mediterranean Gas (EMG).
The agreement should be signed off within a week.
Discussions between Israel and Egypt about importing natural gas were opened in April 2000 but broken off after the eruption of the Palestinian uprising in September that year.
The ministry of infrastructure was not immediately available to comment on the agreement.