Repayment period for gas shipments, petroleum products increased to 3 months from arrival: El-Molla

The Ministry of Petroleum has modified all the concluded contracts with foreign companies to supply

petroleum products and gas shipments. Among the modifications is an increase in the period of

repayment to three months from the date of the shipment’s arrival instead of the previous 30 days.

Petroleum Minister Tarek El-Molla told Daily News Egypt that the repayment period of the shipments was

increased for all companies in order to provide them with the longest period possible to collect the value

of the petroleum products and gas shipments.

He added that the value of the fuel shipments is being repaid regularly in order to meet the market’s

needs of gasoline, diesel, and fuel oil on a regular basis.

El-Molla estimated the average value of monthly imports of petroleum products and natural gas to meet

the local market’s needs at $795m.

Nearly 1.3bn cubic feet of gas are imported daily, he explained. They are portioned into 1.2bn cubic feet

through the two gasification ships in Sokhna Port and the remaining 100m through the Jordan line.

The Petroleum Minister said that after contracting a third gasification ship, total importing capacity will

reach nearly 1.95bn cubic feet of gas daily through the gasification ships in Ain Sokhna.

He explained that average monthly consumption 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 the

different concession areas.

About 2.30m tonnes of petroleum products are imported monthly, including benzene, diesel, butane, and

fuel oil, in order to meet the local market’s needs, said the minister.

El-Molla noted that so far Egypt has obtained petroleum product shipments worth approximately $860m

over the past three months. This was part of the deal made with Saudi Arabia to provide the country with

a portion of its fuel requirements for five years.

The deal with Saudi Arabia stipulates calculating the value of the petroleum product shipments according

to global prices during the time of export, he said.

The Minister of Petroleum said that the shipments agreed upon with Aramco arrive at Egyptian ports on

time. They are then unloaded and distributed inside the local market in order to meet growing demand

during the summer.

Total local production of crude oil is estimated at 695,000 barrels daily. The Ministry of Petroleum plans

to increase this amount to 700,000 barrels in fiscal year 2017/2018, in addition to about 4bn cubic feet of

gas daily.

Egypt has been suffering a chronic US dollar shortage, which has hindered companies seeking the

greenbacks. On the parallel market, the US currency rose above EGP 13 against the national currency in a

matter of weeks. Banks could do little to provide hard cash to consuming sectors and, with the state

trying to minimise operations of exchange bureaus, the Egyptian market has become paralysed.

NGS INDIA