CAIRO: Egypt may import natural gas from Israel “if it will help overcome the energy crisis,” Minister of Petroleum Sherif Ismail told state-owned Al-Mussawar magazine in an interview published Wednesday.
Ismail’s remarks mean that Egypt’s government may have to depend on this controversial solution to provide gas supplies amid efforts to tackle the worst energy crisis that the country has faced over the past few years.
Rolling power cuts in the summer have become routine since the January 25 Revolution in 2011, caused by fuel shortfalls at power plants, and increasing demand as many households run air conditioners.
“Whatever achieves the best interests of Egypt in the region politically and economically… will determine the decision of importing gas from Israel,” Ismail told Al-Mussawar.
On top of President Abdel Fatah al-Sisi’s economic reforms was the gradual removal of subsidies, which eat up more than 25 percent of the state budget. In June, Sisi approved a revised and tightened budget for fiscal year 2014-15 after the deficit was reduced to 240 billion EGP ($33.57 billion,) or 10 percent of GDP; the initial budget draft had predicted a 292 billion EGP shortfall.
Fuel prices rose by 40-78 percent for petrol, and 175 percent for natural gas overnight in early July following the lifting of subsidies.
On Sunday, Ismail told Reuters that a delegation from Russian company Gazprom will visit Egypt in mid-January to complete a deal to import shipments of liquefied natural gas (LNG) to Egypt.
Egypt reached an initial agreement with Gazprom last April to import seven shipments of LNG amid government efforts to procure energy for running power plants, added Reuters.
“We aim to reach a final agreement with Gazprom in January,” the minister told Reuters.
In the past few months, Egypt signed an agreement to secure 850,000 cubic meters of LPG to Egypt with Algeria; negotiations for LPG supplies are scheduled to continue until 2020, Youm7 reported.
The government has also tried to increase gas production through repaying debt owed to oil and gas foreign partners.