Egypt Still in Talks With Foreign Firms About Gas Price Hike

Talks between Egypt and foreign firms are still on to alter the price the government pays for the gas these companies produce, new agency Reuters reports.

The news agency adds that there is no timeline for when negotiations will finish.

Discussions are being conducted by state run entities, Egyptian Natural Gas Holding Company (EGAS) and Egyptian General Petroleum Corporation (EGPC), reports Reuters.

As per Reuters, officials have said they hope revised prices will encourage investment and future production in Egypt, notably offshore where costs are high, to avoid shortages on the domestic market.

Egypt pays offshore gas producers on average around $2-$3 per million British thermal units, according to industry estimates. Comparable payments for gas in Britain are currently above $10 and for Asian supply above $17.

Exploration companies are hesitating to develop untapped gas finds in Egyptian waters partly because the amount the government pays them barely covers their investment costs, adds Reuters.

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