I2C between ADuC7026 and 2416 EEPROM problems

My ADuC7026 wont transmit more than the I2C address byte when trying to read from a 2416 EEPROM memory. The SCL and SDA looks sensible on the 'scope, but I don't know whether it's the hardware or the software. The code is based on the examples and looks like this:

uint8_t Byte_Read(const uint16_t EEPROM_Address)
{
    uint16_t  block;
    bool      wait;
    uint8_t   res = 0xffu;
    uint32_t  reg;

    // Fish out the block address
    block = (EEPROM_Address & 0x0700 ) >> 7;
    // Fill FIFO with Destination Address low bits
    I2C1MTX  =  EEPROM_Address & 0x00ff ;
    // Set Address Write Command with merged block address
    I2C1ADR  = SLAVE_ADDR_W | block;

    // What until Master is finished command
    do
    {
        reg = I2C1MSTA;         // take a copy as some bits are cleared by a read
        wait = (bool)((reg & I2CMSTA_Busy_Mask ) == I2CMSTA_Busy_Mask);
    }
    while(wait);

    if(I2CMSTA_NoAck_Mask == (I2CMSTA_NoAck_Mask & reg))
    {
        res = 0xfeu;
    }

    I2C1CNT = 0;              // Read a Single 8 Bit Byte
    I2C1ADR = SLAVE_ADDR_R | block;           // Transmit read Address

    setTickTimeout(TIdx_I2C, READ_TIMEOUT_MSEC);    // start a timeout timer
    // Wait until Master recieve data, i.e. RXIrq set
    do
    {
        wait = (bool)((I2C1MSTA & I2CMSTA_RXIrq_Mask) == 0x0);
        wait = wait && !(tickers[TIdx_I2C].flag);  // check the timeout timer
    }
    while(wait);

    if(I2C1MSTA & I2CMSTA_RXIrq_Mask)
    {
        res = I2C1MRX;      // Read Data Read
    }

    return res;

}