CAIRO: Egypt’s Petroleum Minister Sherif Ismail signed Monday an agreement to raise both the price and production of natural gas in a previous deal with Germany-based RWE Dea, the ministry stated.
The German energy firm is now responsible for an onshore gas development project in the Nile Delta Desouk region.
Egypt’s oil sector hopes that amending gas prices would encourage its foreign oil and gas partners to inject more investments in exploration and production fields, amid efforts to tackle the worst energy crisis that the country has faced over the past years.
Under the agreement, the price of fresh gas will be raised to $3.50 for every million British thermal units from $2.50, the statement read.
Further, DEA would increase average natural gas production in the Desouk development’s phase one to 210 million cubic feet (mcf) per day by this summer, from current rates of 145 mcf.
In phase two, average production would then hike to 300 mcf per day ahead of 2016’s summer, the statement said.
Signing this agreement brings the total number of oil deals Egypt has sealed since November 2013 to 56 shipments, with total investments valued at $12 billion.
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.
To procure energy for running power plants, Egypt has recently contracted with five foreign companies to import 90 shipments, 45 of which are scheduled to be delivered in 2015 and 2016.