Amwal Al Ghad congratulates Mohamed Farid on his appointment as Egypt financial regulator chief    Saudi Arabia to launch company to attract $10 billion investments in Egypt    China's foreign exchange reserves jump to $3.104 trillion – SAFE    Egypt, South Korea to perform Pyramids Air Show 2022 Today    Egypt: Sisi appoints 73 female judges in the Court of First Instance    Egypt closer to export COVID vaccines after reaching 2nd highest WHO classification    Spain: prosecutor seeks 8 years sentence for Shakira over tax evasion    Egypt: Alamein Art Festival kicks off a collection of recycled installations    Russia delivers test kits of monkeypox to Egypt    John Legend enjoys family trip in Egypt    Sisi: Egypt wants to join BRICS    Egypt: street photography will no longer require permits    Sisi: Egypt determined to transition to low-carbon economy    Sisi, Biden discuss cooperation between two countries    Egypt's athlete Basma Emad wins bronze in weightlifting in Mediterranean Games    Congo needs Egypt's expertise to diversify its economy – FPI official    Noura Al-Mutair – first Gulf female boxer in World Championships    Egypt to play key role in integrating water, climate issues globally – World Bank official    Maha karara joins AAIB as Head of Corporate Communications, Sustainability    Egypt works on charting cooperation strategies with international institutions for 5 years: Al-Mashat    Over 2.4 million newborns examined for hearing impairment: Health Ministry    Netflix releases trailer of Arab adaption of 'Perfect Strangers' film    Balqees to headline concert celebrating launch of streaming giant LIVENow in MENA    Sawsan Badr to be honoured at Aswan Women Film Festival    MP Abdel Hady Al-Qasby calls government to facilitate and support NGOs    Al-Sisi follows up on 'Great Transfiguration Project' in St. Catherine    Cairo, London stress need to strengthen cooperation to face climate change    Foreigners account for 22.6% of Egypt's T-bills issuances in 1H 2021: CBE    Egypt's ambassador to Italy passes away    Egypt confirms readiness to help African countries face terrorism and extremism    An estimated 235 million people needed humanitarian assistance and protection in 2021, an increase of 40% compared to 2020: IOM Egypt    Egypt, DRC discuss water cooperation during WYF    Egypt, DR Congo discuss boosting bilateral cooperation during WYF    Cameroonian police probe assault on three Algerian journalists covering AFCON    Pharaohs start AFCON 2021 campaign with fierce clash against Nigeria    Foreign Ministry opens capacity building course for French-speaking African diplomats    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    

Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.

Cost of LNG imports during current fiscal year amount to $1.8bn: Minister of Petroleum
Egypt's current gas production at 5.2bn cf per day, imports to stop at end 2018
Published in Daily News Egypt on 18 - 09 - 2017

The government succeeded in solving the energy saving crisis faced by the country until 2015 by importing liquefied natural gas (LNG) shipments and realising large oil and gas discoveries that contributed to reducing pressure on foreign currency and saving energy through local production, which necessitated dialogue with Minister of Petroleum and Mineral Resources Engineer Tarek El Molla to explain the sector's plan to increase oil and gas production and economic development, and to direct his message to investors.
How can Egypt become a gas-exporting country after a 5-year long break?
The oil sector gives top priority to meet the needs of the local gas market before becoming an exporting country and sets the priority of achieving self-sufficiency of natural gas by the end of 2018, once the major discoveries have been linked to the production grid.
The Ministry of Petroleum is seeking to achieve a surplus of gas by 2020, so that part can be directed to meet the contractual obligations for export, as a message to reassure the investors that Egypt is a country committed to the contracts concluded. In order to optimise the utilisation of resources, the ministry will direct the bulk of the gas surplus to develop the petrochemical industry, which would also contribute in achieving value added and optimal utilisation of natural resources.
What is the size of Egypt's total production of gas and oil? What is the plan to bloat production?
Egypt's current production of gas is about 5.2 billion cubic feet per day, up from 4.46 billion, when the first stages of the West Delta fields entered the production map. The production will continue the gradual increase after the first phase of the Zohr field is linked to the production grid by the end of the year, as well as Atoll field, while production of oil is estimated at 700,000 barrels of crude oil per day.
The ministry is exerting much effort to boost production through adopting the latest technological methods to offset the natural decay and increase production of existing wells. The sector is proceeding with the plans to increase oil production.
We are also moving forward with our plan to offer tenders for exploration.
The oil sector signed 82 exploration agreements with a minimum investment of about $15.4bn, which are expected to fruit some new discoveries, supporting the goal of increasing production and reserves of petroleum wealth.
Efforts are also being intensified in cooperation with foreign partners to carry out projects to develop large gas discoveries in the deep waters of the Mediterranean Sea and the Nile Delta to contribute to the planned increase in gas production.
How many shipments of gas are imported in the current fiscal year? What is the cost of importing gas? When will we stop importing?
80 shipments of liquefied natural gas (LNG) worth around $1.8bn are set to be imported to meet the needs of the local market, stressing that imports have been cut significantly after the increase in domestic gas production last year.
The procurement program considers the different needs and consumption rates between the different months. The summer months record the highest rates of gas consumption in the power plants, with imports gradually decreasing in winter, in conjunction with the decline in electricity needs and the entry of new fields of production by the end of the year.
Before the end of 2018, we will stop importing and achieve self-sufficiency, which will be secured through local fields production. The coming year, before achieving self-sufficiency, we will reduce the number of imported LNG shipments.
What is the size of investments spent on Zohr Field so far?
Eni's investments in Zohr field in the Mediterranean amounted to $4bn so far.
When will Egypt offer new tenders for exploration of gas and oil?
Offering international tenders for oil and gas exploration is one of the ministry's most important work mechanism to support production.
The timing of offering tenders is subject to intensive studies. Offering tenders is an ongoing dynamic procedure and offering is done following completion all geological and geophysical studies.
What are the details of the gas projects that will be linked to production in the current fiscal year?
Before the end of this year, three major projects will be completed, including the first phase of Zohr field, which will see its production growing gradually to reach 2.7 billion cubic feet of gas per day when all phases are completed in 2019. This is in addition to the Atoll gas field, which has rates of 300 million cubic feet of gas per day, next to Noras field with 1.2 billion cubic feet per day in production.
Production companies are going forward with the development of fields and existing finds in all areas to link new wells to production, whether in the western or eastern desert, or also in the Gulf of Suez and the Delta.
What is new with the cooperation with Cyprus and Greece in the Mediterranean?
The Egyptian- Cypriot – Greek relations are strong across all field. In the economic aspect, Egypt is their optimal and most important partner in the Middle East and North Africa.
Several meetings were held to discuss ways to enhance energy cooperation between the three countries. Specific areas were identified for broader regional cooperation in the field of hydrocarbon activities, as well as safety in marine activities and energy infrastructure, research and development in the hydrocarbon sector. This is in addition to the agreements between Egyptian and Cyprus governments to establish a gas pipeline from Cyprus to Egypt, which will work to achieve mutual benefit and support strategic cooperation in the fled of energy, which also serves Egypt's plan to become an international hub for energy trade in the region.
What is new with the pipeline agreement with Cyprus?
Possible options for the pipeline and land facilities to transport Cyprus natural gas to Egypt are being explored using the infrastructure available between Egypt, Cyprus and Greece, which will contribute to strengthening Egypt's position and supporting its project to become a regional hub for energy trading, next to improve the value added and revenues from the facilities of gas liquefaction in Egypt that will receive Cyprus gas.
What is the size of crude oil does Egypt import from Iraq and Kuwait?
The agreement with the Iraqi side includes the supply of 12 million barrels of crude oil for one year, to be refined in Egyptian refineries, as of last May, of which Egypt received four shipments of 2 million barrels each.
The contract with Kuwait Petroleum Corporation (KPC) was renewed in April for a period of 3 years to supply 2 million barrels per month to be refined in Egyptian factories, while the value of each shipment varies according to international prices at the time.
How will Egypt become a logistical centre for energy trading?
A committee was formed by a decision of the Prime Minister under the chairmanship of the Minister of Petroleum and includes a number of ministries concerned with turning Egypt into a logistic centre to follow up this national project and support its implementation.
Egypt has many elements that enable it to transform into a regional centre for energy trading, foremost of which is the distinguished geographical location, which is the middle of the producing countries that are rich in energy sources and major consumer countries. These advantages require the support of a strong infrastructure in the field of oil and gas, and passage of investments-attractive legislation.
The Suez Canal as the most important international shipping corridor for international trade, and SUMED crude oil and petroleum products project in Ain Sokhna and Sidi Keri are of the main pillars of the current trend to turn Egypt into a regional hub for energy.
The Ministry of Petroleum is developing the capacity of the SUMED project, and recently completed the operation of a new seaport at the port of Sumed, Ain Sokhna, and is currently developing and expanding the oil and gas pipeline network, natural gas liquefaction and exporting plants and new refining projects.
Production rates are currently being accelerated in the discovery of new natural gas and the development of oil ports, in addition to the promulgation of the law regulating the activities of the gas market prepared by the Ministry of Petroleum and the new investment law as well as many steps being implemented to achieve this national project.
What is the size of arrears owed by government agencies to the Ministry of Petroleum?
The sector's entitlements by government agencies, which represent the value of their withdrawals of petroleum products and natural gas, at EGP 96.2bn. This is a major challenge for the ministry, where the accumulation of debts owed by government agencies force the ministry to borrow.
The electricity sector is the largest consumer of oil with a total of about EGP 75.9bn of arrears, while the other sectors, such as aviation, railway, and public business companies are due to pay about EGP 20.3bn. The government has this issue on its priorities and works on rescheduling the debts.
What is the size of debts owed to foreign partners?
They were cut to $2.3bn, which is the lowest since 2013, after the ministry paid $2.2bn of arrears to international oil companies working in Egypt.
Foreign partners' entitlements amounted to $6.3bn in 2013. The obligation to pay the current receivable bill regularly did not accumulate any new entitlements. This reflected positively on the increased inflow of foreign oil companies' investments in Egypt and thus increased the country's crude oil and gas production.
What about the Edison concession area?
Edison implemented a seismic reflection survey in its concession area in the Mediterranean. The survey was completed and the company is now studying the geological structures in preparation for choosing the best drilling program in the coming period.
Will there by further petroleum agreements with foreign partners in the coming period? What are the most prominent of which?
The Ministry of Petroleum recently signed 6 new oil agreements with US and international companies, approved by Parliament and issued by the President, with a total investment of $160m minimum, and signing grants of $64.2m to drill 33 wells.
How much is the cost of providing fuel for the local market without subsidy? How much is secured through importing and local production?
The ministry saved some 78 million tonnes of petroleum products worth EGP 411bn at a cost of EGP 321bn and sold on domestic market at EGP 200bn. He noted that domestic production secures 70% of local needs and the state imports the remaining 30%.
What are the developments in the cooperation agreement with Jordan?
Relations between Egypt and Jordan have improved thanks to the distinguished relations and the brotherly ties between the two countries. The memorandum of cooperation I signed with the Jordanian Minister of Petroleum opens aspects and new fields of work, such as experts training and transferring Egyptian experience in natural gas sector.
This is in addition to re-exporting gas to the consuming countries in the region through the existing infrastructure in both countries, as well as using the gasification units in Ain Sokhna and Aqaba in emergencies during maintenance periods to cover part of the countries' needs of gas. This is an example of the Arab integration and cooperation in energy sectors.
What is the statue of the Gas Regulatory Authority? What are the companies that presented requests to import? Have the requests been approved?
Egyptian President issued a decision upholding law No. 196 for 2017 related to issuing a law for regulating gas market activities, which was approved by the parliament in the last session. This gave a push to working in this regard, with the aim of establishing a regulatory authority that clarified relations between suppliers and consumers, as well as the operators of the gas grid.
This came in light of working to liberalize the gas market and open the door for the participation of the private sector to compete in the gas market, which means new supplies that cope the growth needs. We are now working on drafting the bylaws to pass them soon.
Several private companies have submitted requests to obtain the license for importing gas. And initial agreement was granted to number of them.
What is the ministry's plan to link natural gas to houses?
The ministry plans to deliver natural gas to about 600,000 residential units in 26 governorates in the current fiscal year, including areas, villages and cities where natural gas is first introduced.
What are the new projects in the petrochemical sector?
There are planned projects, including the Styrene production project in Alexandria and other projects under study and development, with investments of about $1.5bn, including the project of producing propylene and its derivatives with the expansion of Sidi Kerir Petrochemicals (SIDPEC) and the ammonia production project.
The petrochemical sector will also witness the establishment of a project to produce formaldehyde and its derivatives and the project of production of resins and medium density wood panels (MDF), as well as an integrated petrochemical complex at the Suez Canal Economic Zone, the Phase II project to increase ethane extraction from the Western Desert Gas Complex, and the refining and petrochemical complex in southern Suez.
What about the results of the gold excavation tender that was recently awarded?
We are working to finalize the agreements' laws for the awarded companies to present them to the legislation authorities to obtain final approvals. These will be submitted to the parliament in the coming session.
What is your message to investors in the oil sector?
It is not a message to investment in oil only, but rather to all investors. Egypt is recovering and is currently working to increase economic growth and aspires to achieve more successes, in the light of political stability. Egypt is the land of opportunities. The political leadership said, several times, that it stands with fair investment which achieves state's interest and expected revenues for investors, which is why the government passed the new investment law and its bylaws.
The oil sector involves investment opportunities they working to configure and offer optimally. We have prospects for oil and gas areas and global partnerships and long history and experience accumulated in this vital industry. We are committed to our financial obligations and we work to pay the arrears to our partners, which have emerged due to the unstable conditions seen in Egypt before.
I believe you are following the great interest and demand in the international auctions offered by Egypt, with trust in the reputation of the Egyptian petroleum sector and its strong and clear commitment to the investors.

Clic here to read the story from its source.