By SUMMER SAID
Egypt is still talking with some Arab oil and gas producers to secure fuel supplies to ease its shortages, Egypt's new oil minister Sherif Haddara said after local media reports suggested the deals are collapsing.
The negotiations with Qatar, Iraq, and Libya, members of the Organization of the Petroleum Exporting Countries are still ongoing in order to secure the best formula to serve the interest of Egypt," Mr. Haddara said in a statement.
Egypt agreed in principle with gas rich Qatar on a swap deal under which, BG Group and PETRONAS will give the North African country about 500 Mcf/day of the natural gas they extract to help ease its fuel shortage, while Qatar Gas will send the LNG directly to the companies' overseas customers.
It also made preliminary deals with Libya and Iraq to secure close to 5 MMbbl a month but the terms of the agreements are yet to be finalized.
Local media reports said earlier this week that talks with Qatar and Iraq have stalled due to disagreements over payment related issues.
A Cabinet statement said that Egyptian General Petroleum will ink a deal with Libya to import 30,000 bpd of crude for a year but did not specify the financial terms of the agreements.
Libyan officials were not reachable for comment.
Egypt has been facing a diesel shortage since last year, leading to rising food costs, long queues at filling stations and electricity blackouts.
The fuel crisis has compounded broader economic problems in the country, which in 2011 overthrew the government of Hosni Mubarak in a popular uprising, paving the way for the electoral victory of the Muslim Brotherhood. Egypt has been facing a drop in its hydrocarbon production as well as a slowdown in oil and gas exploration activities over the past couple of years as a result of the continuing civil unrest since the ousting of Mr. Mubarak.Mr. Haddara said the country has a long term plan to lift its crude production to 1 MMbpd from the current 680,000 bpd and gas output to 7.5 Bcfpd from 5.7 Bcfpd but he did not give a timeframe for the plan.
Dow Jones Newswires