Entering the nuclear era is no longer a luxury, writes Sherine Nasr A year has already elapsed since the National Democratic Party (NDP) raised the call for Egypt to enter the nuclear era. The ruling party's proposal was unveiled during its fourth conference last September, and is similar to other initiatives made over the past 50 years. Naturally, Egypt's proposed next "national project" was in the headlines for several months, but eventually enthusiasm dampened and the idea slipped into oblivion once again. Nevertheless, the NDP's initiative seems to have opened an endless debate among concerned bodies about the immense political, economic and environmental challenges which face a developing country trying to catch up with its nuclear superiors. For their part, energy experts are convinced that sooner is better if Egypt is ever to meet its growing developmental needs. "Egypt has no choice but to generate energy using nuclear power and encourage renewable energy such as solar and wind," asserted Hussein Abdallah, former senior under-secretary at the Ministry of Petroleum and an expert in energy economics, during a recent seminar organised by the Higher Council of Culture. "It should start immediately." Abdallah believes that Egypt's oil and gas resources are rapidly depleting, therefore the nuclear option is vital. Unlike the optimistic figures given by the Ministry of Petroleum regarding oil and gas consumption, proven reserves and exploration, Abdallah sees the picture as gloomy. Domestic oil and gas consumption has been increasing by an average annual rate of five per cent since 2006, according to a recent study conducted by Abdallah. The research on Egypt's energy strategy for the next 20 years concluded that consumption will rise from the current 52 million tonnes to 103 million tonnes by 2020. Also, while the Ministry of Petroleum asserts that total proven oil and gas reserves are currently estimated at 2.15 billion tonnes, Egypt's share would only be about 1.075 billion tonnes, noted Abdallah. The remainder goes to foreign companies operating in Egypt in cost recovery and net profit. "Egypt's share of oil and gas production is already not enough to cover our domestic consumption," he argued. "Therefore, we have to purchase part of the [foreign] partner's share at world prices." Based on the above estimates, the anticipated accumulation of domestic oil and gas consumption would be around 1.1 billion tonnes over the period 2006-2020. Depending on the highest estimate of Egypt's share of reserves, this share will be entirely consumed by 2020 or a few years afterwards. However, if Egypt plans to export part of its share, production must increase remarkably to cover domestic and export needs. But then this implies that reserves would be depleted well before 2020. At the current level of domestic consumption of 52 million tones per year, and a world price of $60 a barrel, the real value of domestic consumption would be worth $20 billion. Abdallah noted that the price of oil would escalate by at least an annual rate of three per cent to cover for inflation. Therefore if Egypt's share of oil and gas reserves is depleted by 2020 and Egypt is forced to import its total needs, it should be ready to pay a rising import bill of no less than $65 billion every year. The expert called for immediate action to build a sound energy strategy and ration oil and gas production, with a growth rate that matches the five per cent of domestic consumption. This would also be a fair and just reward for foreign oil companies, considering sky rocketing oil prices which give them a lot of windfall profits, he added. Abdallah's call to curb gas exports is further supported by the fact that net export gas prices are no more than $3.75 per million British thermal units. This means that the price of an oil equivalent barrel of gas does not exceed $22 -- a miserly one-third of the export price of oil. "The ABCs of gas economics make it more profitable to use it at home due to its low export price, higher environmental qualities, ease of use, and the fact that it does not need to build refineries which require heavy capital and operating costs," advised Abdallah. Abdallah is not the only expert concerned about Egypt's energy security and sustainability. An NDP discussion paper entitled The Future of Energy and the Right of the Coming Generations, submitted during the party's conference last year, underlined the growing needs of different energy sources to satisfy an ever increasing appetite to produce electricity. According to the paper, the electricity sector consumed 38.1 per cent of total fuel produced in 2004-2005; almost 87.5 per cent of total electricity depends mainly on natural gas; while 59.2 per cent of total natural gas produced is used to generate electricity. The study concluded that an efficient alternative to produce electricity should be used, namely nuclear energy. Egypt's first step on the road to nuclear power was taken in 1953, when a nuclear energy committee was established. The first attempts to use nuclear energy to generate electricity and desalinate sea water started in 1964, when a tender was held to build the first nuclear reactor in the coastal city Borg Al-Arab. But the national project was stopped in its tracks in the wake of the 1967 setback. The idea was revived after the 1973 victory, and the Carter-Sadat report issued in 1978 studied the possibility of establishing nuclear reactors in Egypt. "The aim of the report was to study the possibility of establishing five nuclear reactors in Egypt by 2000, to cover 80 per cent of the country's energy needs," explained Karima Korayem, professor of economics at Cairo University and head of the Egyptian delegation which worked closely with American counterparts to conclude the report. Although nothing has yet materialised, most of the obstacles cited by the study no longer exist as a result of immense advances in nuclear technologies over the past two dec a des. According to Korayem, the construction phase of a nuclear reactor is down to four years instead of ten years in the 1970s estimate. "Construction and operation costs have also been reduced dramatically," she added. Moreover, the average cost for generating electricity using nuclear energy has now become cheaper than the average cost of any other form of energy. In 1987, for example, one kilowatt of electricity using nuclear energy cost 3.36 cents, while in 2004 the cost is 1.68 cents. "In twenty years, the cost of nuclear generated electricity was reduced by 54 per cent," noted Korayem. "Further reductions in cost are most likely with the introduction of the third generation of nuclear reactors." If using nuclear energy is generally more beneficial, it is the wisest choice for Egypt. Mohamed Mogahed, a nuclear energy expert, noted that uranium -- the basic ingredient needed to operate a nuclear reactor -- is abundant in Egypt. Also, building a nuclear reactor is perhaps one of the best ways to create new job opportunities. "It takes at least 4,000 construction workers and some 400 highly qualified technicians to work continuously for four to seven years to build a reactor," explained Mogahed, adding that it is hard to ignore the human development element included in the scheme. "In a country where the unemployment rate is hovering around 10 per cent, and where there is urgency to bridge the technological gap with the rest of the developed world, the issue takes broader dimensions than simply trying to satisfy a growing demand for energy," he asserted.
