(AFP File Photo)
The Egyptian Natural Gas Holding Company (EGAS) and Algerian company Sonatrach are currently in negotiations for the latter to provide five shipments of liquefied natural gas (LNG) for electricity production over the summer months.
EGAS Chairman Khaled Abdel Badie said the Algerian delegation will arrive in Egypt in mid-July in order to conclude the proceedings.
EGAS needs about $1bn to import gas to power stations throughout the three summer months. The amount is needed to import 17 shipment of LNG, rent a regasification vessel and dock at Ain Sokhna, and sign letters of guarantee, according to Abdel Badie.
He explained that an agreement has already been reached with the Russian company Gazprom to provide seven shipments of LNG, while the French company EDF will provide five shipments. Each shipment will contain about 170,000 cubic metres of gas.
Each shipment of LNG meets the needs of the power plants, estimated at 500mcubic feet per day, for a period of more than six days, according to Abdel Badie.
The regasification vessel will reach the port of Ain Sokhna in September. In May, the Ministry of Petroleum signed a five-year agreement with Norwegian company Höegh to rent a regasification vessel, to convert LNG back into its gaseous state, said Abdel Badie.
Egypt is currently facing a decline in the gas production rates. The deficit has reached about 2bn cubic feet per day while the current output stands at 4.9bn, compared to 5.6bn produced the same time last year.
