As protests against President Hosni Mubarak entered their 12th day, officials say that attackers planted explosives on the pipeline in the town of Lihfen in the Sheikh Zuwayed area of the Sinai peninsula, which borders on the Palestinian territory of Gaza.
They also attacked the terminal, one official told the AFP wire service.
Rescue services were putting out the fire, local official Gaber al-Araby told Egyptian television.
Israeli public radio quoted an Egyptian official as saying the attack was carried out at dawn, using a small amount of explosives which caused only minor damage.
The fire lasted three hours and was under control, he said.
It was not clear whether the attack was linked to deadly to the anti-Mubarak protests.
An armed Bedouin group in June threatened to attack the pipeline, security officials said, leading Egyptian authorities to beef up security around the pipeline and terminal.
The Bedouin complain of routine harassment and discrimination by Egyptian police, accusing them of exploiting concerns about the pipeline to crack down on the community.
Human rights groups have criticised Egyptian policy towards the Bedouin, who were subjected to harsh police treatment after a series of bombings in Sinai resorts between 2004 and 2006, which killed dozens of Egyptians and foreign tourists.
Egypt supplies about 40 per cent of Israel's natural gas. In December four Israeli firms signed 20-year contracts worth up to 7.4 billion euros to import Egyptian gas.
Israel recently expressed concern that its natural gas supplies from Egypt could be threatened by the anti-Mubarak uprising and threaten the 30-year-old peace treaty between the two countries.
Much of Egypt's opposition, including the powerful Muslim Brotherhood, has called for Cairo to stop the gas supply.