Quarrel over EDGE THE DISPUTE between Egypt's largest mobile network operator MobiNil and the National Telecommunications Regulatory Authority (NTRA) over the former's use of Enhanced Data for GSM Evolution (EDGE) technology, escalated last week with MobiNil warning that it will resort to international arbitration. NTRA for its turn threatened to sue MobiNil if it resumes offering services based on EDGE technology before it receives a 3G license. The license fee costs a whopping LE3.4 billion. EDGE technology allows the transfer of data at a high rate of 236KB per second, which is four times higher than the speed of the GSM and GPRS applications currently used by MobiNil. These are known as 2G applications. But the International Telecommunications Union (ITU) considers EDGE a 3G technology because mobile operators can technically modify it to transfer data at almost double the speed of 236KB, almost touching the ITU's lower speed range for 3G services. Meanwhile, the GSM Association, another international telecommunications regulatory body, considers EDGE a 2.75G technology which does not require a 3G license. Talking to reporters on the fringe of the Cairo ICT conference last week, MobiNil's CEO Alex Shalaby stressed that none of the service providers offering EDGE technology in 88 countries acquired a 3G license to do so. Meanwhile, NTRA's chairman Amr Badawi stressed this week that the authority will not accept an international verdict which contradicts Egyptian law. The telecommunication law of 2003 obliges any service provider to acquire a license to start offering new services. Badawi added that if EDGE indeed proves to be a 2G application, MobiNil will still have to negotiate additional fees for providing the service. According to an NTRA press release, MobiNil erected equipment that uses EDGE technology in 2004 on an "experimental basis", promising not to use it for commercial purposes without the regulatory body's approval. But in May, 2006, MobiNil offered EDGE services from more than 200 transmission stations without getting the green light from NTRA. Three months later, the Minister of Communication and Information Technology Tarek Kamel asked MobiNil to suspend the service until it reaches an agreement with NTRA. MobiNil's current and future rivals Vodafone Egypt and Etisalat Misr, respectively, have already acquired the 3G license. Shalaby said that MobiNil may consider paying the license fee once its competitors start offering the high-speed service later this year. He conceded that MobiNil's market share would be affected after other providers begin 3G services, but the impact would be confined to a small segment of high-revenue business accounts. MobiNil had decided last month not to apply for the license for the time being, because it did not want to burden investors with the high fee and heavy operating costs. Kamel told the ICT gathering last week that growth rates in mobile phone services are expected to surge to nearly 100 per cent over the next three years. The number of mobile phone subscribers should double from 18.5 million at present to 34 million by the end of 2010. The growth in mobile phone services increased to record levels of 70 per cent in 2006, compared with a year earlier (see p. 15). Prosperous dig BRITISH Petroleum (BP) has announced a significant natural gas discovery, Giza North- 1, north of Alexandria. The dig encountered a significant gas accumulation which is part of a large channel complex in its concession area. "It is estimated that the Giza complex contains more then one trillion cubic feet of gas, an equivalent to half of Egypt's natural gas consumption in one year," according to Minister of Petroleum and Mineral Resources Sameh Fahmi. Another well is planned to be drilled in the Mediterranean Sea in April, 2007 to further appraise the complex. The rig will shortly move on to the next appraisal well in the Taurus field, as part of a planned four-well appraisal programme in North Alexandria. Hisham Mekawi, president and general manager of BP Egypt said that his company has already made a number of discoveries since 2000 in this concession, including Taurus, Libra and Fayoum. Mekawi added that BP's cooperation with the Ministry of Petroleum is helping to unveil new gas discoveries and further enhances gas supplies to meet future demand. The Giza North-1 well was drilled in 668 metres of water, some 56 kilometres offshore. Mining reform THE MINISTRY of Petroleum and the International Finance Corporation (IFC), the private sector arm of the World Bank (WB), signed an memorandum of understanding last week by virtue of which IFC will extend technical assistance to the Egyptian mining sector. Managed by the IFC's technical facility in the Middle East and North Africa, PEP- MENA, the joint project aims at reforming Egypt's mining laws, regulations and taxation. This is designed to attract more foreign direct investment into one of Egypt's most important sectors. The Egyptian government had recently undertaken steps to liberalise the mining sector, in a bid to lure potential local, regional and international companies to work in the field. In order to accelerate the reform process, the Mining Resources Organisation recently changed its affiliation from the Ministry of Industry to the Ministry of Petroleum. "Other legislative reforms governing this sector still need to be done," explained Minister of Petroleum and Mineral Resources Sameh Fahmi. "This is what we are embarking upon, at present." IFC's Senior Regional Manager Gulrez Hoda believes that "Egypt's mining sector has outstanding potential. An improved policy framework, which clearly defines procedures for private investors, will help attract new investments and improve the country's economy." PEP-MENA is a multi-donor facility for technical assistance that supports private sector development across the Middle East and North Africa region. The IFC is the largest multilateral provider of finance for the private sector in developing countries. The corporation a;sp finances private sector investments, in addition to mobilizing capital in international financial markets, and facilitating trade.
