The value of petroleum products exported by the Saudi Arabian company Aramco to Egypt beginning in May of this year and throughout the past four months has reached $1.2bn. This amount was estimated at 700,000 tonnes of fuel per month.
Minister of Petroleum and Mineral Resources Tarek El-Molla told Daily News Egypt that the value of the shipments is decided according to the global prices at the time of the arrival of each shipment to Egyptian ports.
He noted that the Egyptian General Petroleum Corporation (EGPC) has launched a tender to supply all the domestic market’s needs of petroleum products in November in order to secure the necessary needs of fuel as an alternative for Aramco’s shipments.
El-Molla added that Aramco has not officially reported the date of re-supplying the fuel shipments to Egypt according to the signed contract, which stipulated that Egypt would be provided fuel for a five–year period. “This is why we launched a tender for the required amounts,” he added.
The minister explained that Aramco has not officially informed the Ministry of Petroleum of the situation regarding the November shipment, and that EGPC is launching regular tenders for the country’s needs of petroleum products. “We have no problem supplying them in the local market,” he added.
El-Molla added that Aramco has been regularly providing the fuel shipments at the agreed upon amounts since May, and ports have regularly received 400,000 tonnes of diesel, 200,000 tonnes of gasoline, and 100,000 tonnes of fuel oil per month.
The contract signed with the Saudi side implies that the value of petroleum products are determined based on the global prices at the time of the supply.
The contract signed between the Ministry of Petroleum and Aramco states that the latter will supply Egypt with petroleum products for five years at an interest rate of 2% and a grace period of at least three years. EGPC will pay the dues.
The total cost of the shipments is expected to reach $30bn throughout the five years if the global decline of petroleum prices continues.
The average monthly production of petroleum products and natural gas in the local market is estimated at 6.5m tonnes. About 4.20m tonnes are provided through local production in different concession areas.
An estimated 2.30m tonnes of petroleum products and natural gas are imported monthly in order to supply the needs of the local market.
