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FILE PHOTO: Acting U.S. Assistant Secretary of State for Near Eastern Affairs, David Satterfield, prepares ahead of his address to the 11th Annual International Institute for National Security Studies (INSS) Conference in Tel Aviv, Israel January 31, 2018. REUTERS/Amir Cohen

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WASHINGTON (Reuters) - David Satterfield, a veteran U.S. diplomat with deep experience in the Middle East, is the leading candidate to be nominated as U.S. ambassador to Egypt, two U.S. officials said on Thursday.

Egypt is of strategic importance to the United States because of its control of the Suez Canal, its border and peace treaty with Israel and its status as the most populous Arab nation. It has been without a U.S. ambassador for over a year.

U.S. President Donald Trump has signalled warmer relations with Egyptian President Abdel Fattah al-Sisi by unfreezing $195 million in military aid previously withheld because of concerns over Egypt’s human rights record.

Sisi led the 2013 overthrow of Egypt's first freely-elected president, Mohamed Mursi of the Muslim Brotherhood, following protests against Mursi’s rule. He was elected president in 2014 and re-elected this year after an election in which all serious opponents had withdrawn.

Egyptian authorities have jailed thousands of Sisi opponents and critics in recent years, including both alleged Islamist militants and secular rights activists. Cairo says it is going after terrorists and saboteurs trying to undermine the state.

The officials, who spoke on condition of anonymity, said Satterfield's post as the top U.S. diplomat for the Middle East will end if the U.S. Senate confirms David Schenker as assistant secretary of state for Near Eastern affairs. Satterfield has that job on an acting basis for nearly a year.

The White House, which nominates U.S. ambassadors, declined comment on Satterfield emerging as the leading candidate to head the U.S. embassy in Cairo, as did the State Department.

A former U.S. official said Satterfield had particularly good contacts with the Egyptian military because of his 2009 to 2017 service heading the Multinational Force and Observers (MFO) in the Sinai Peninsula, which oversees security provisions of the 1979 Egypt-Israel peace treaty.

Despite U.S. concerns over human rights in Egypt, militaries from the two countries have deep ties and next month will take part in Exercise Bright Star, which is designed to improve their ability to operate together, the U.S. military said.

Satterfield has previously served as the deputy U.S. chief of mission in Iraq, ambassador to Lebanon, director for Near Eastern affairs on the National Security Council as well as in Syria, Tunisia and Saudi Arabia.

(Reporting By Arshad Mohammed and John Walcott; Editing by Susan Thomas)

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Reuters