Egypt and British oil major BP have signed LNG supply deal for two years, which is, however, less than earlier figure proposed, official sources have announced
BP will now supply 16 cargoes to the state-run Egyptian Gas Holding Company (EGAS) as opposed to 21 cargoes agreed upon earlier.
This deal was meant to form part of a major tender Egypt had awarded BP in January to buy 70 LNG cargoes, worth about US$2.2bn, but recurring delays threw the deal into doubt as Egypt scrambled to cover its energy needs, Reuters reported.
EGAS chairman Khaled Abdel Badie said, “We signed with BP to supply 16 cargoes of liquefied natural gas that will be received through 2015 and 2016.”
The North African country has emerged as a major new market for LNG just as demand in the world’s biggest consuming region Asia weakens, driving prices 60 per cent lower and prompting traders to seek alternative opportunities. Falling output and rising demand are transforming Egypt from an oil and gas exporter to an importer.
Alongside the current purchases, Egypt has also struck LNG import deals with Algeria’s state-run Sonatrach for six cargoes and Gazprom’s trading arm for 35 cargoes.
