Egypt Owes $3 bn to Energy Firms

The Egyptian government’s total dues owed to foreign oil companies stood $3 billion by the end of 2014, Khaled Abd El Badee - Chairman of state-run Egyptian Natural Gas Holding Company (EGAS) said, reported Egypt’s Amwal Al Ghad newspaper.

He added that the government has recently paid $2.1 billion of the dues, referring to a clear strategy being set to overcome the challenges blocking the oil and gas industry in Egypt. In recent weeks the government has paid part of the dues to companies such BG Group, Dana Gas and Circle Oil.

The Egyptian economy is facing severe gas shortage as local demand has ballooned in recent years amid declining domestic production.

In his keynote speech at the 9th session of the Egypt-Japan Business Council, El Badee said the government is looking to bridge the supply-demand gap by importing gas from various sources, Amwal Al Ghad .

In December, Algeria and Egypt signed a previously announced natural gas deal. According to Egypt's Minister of Petroleum, as per the deal Algeria will supply 850,000 cubic meters of LNG in six shipments to Egypt during 2015. The two countries will begin fresh talks shortly regarding supply of Algerian gas during 2016-2020, the ministry said adding that negotiations will start in Cairo and will be completed by February in Algiers.

Cairo is also expected to sign a deal to import LNG from Gazprom. Egypt is likely to buy 35 shipments of LNG over the next five years from the Russian company. Shell is another company likely  to begin supplying gas to Egypt this year.