Fuelling the future
Egypt is banking on its petroleum sector for its economic revival. Nevine Khalil reports
The first stage of the $200 million Arab natural gas pipeline linking Egypt, Jordan, Syria and Lebanon will be completed by mid-July. The announcement was made on Sunday during a meeting between President Hosni Mubarak and several of his cabinet members. Mubarak held the extensive two-hour meeting to discuss various aspects of Egypt's petroleum and gas reserves -- including revenues generated, most recent discoveries and future projects. Egypt's oil reserves now stand at 3.78 billion barrels of crude oil and 60 trillion cubic metres of natural gas.
Mubarak said that research in the petroleum sector serves several strategic, economic, developmental and social goals. The research hopes to map out and predict the economic revenues as well as the export levels from oil and gas. In addition, the project will help guarantee the rights of future generations by providing job opportunities and building a common infrastructure for Arab countries, he said. Within 20 years, it is predicted that natural gas fuel will reach six million homes in Egypt.
At the meeting, Minister of Petroleum Sameh Fahmi said, the natural gas pipeline which begins in Egypt at Al-Arish, travels 248kms southeast to Taba, crosses underwater for 16kms to the Jordanian port of Aqaba, and then continues for 370kms to the town of Rehab at the Jordanian-Syrian border. From there, the pipeline stretches out to the Syrian-Turkish border, then reaches the Syrian port of Baniyas, and finally ends at the Syrian-Lebanese border. Minister of Electricity Hassan Younis also made a presentation about the regional power grid which links Egypt, Libya, Syria and Jordan.
Discussing Egypt's revenues from the petroleum sector, Fahmi noted that Egypt's net revenue currently stood at $100 million. This is expected to reach $800 million by 2004 and just over $3 billion by 2010. He also said at the meeting -- which included Prime Minister Atef Ebeid, the ministers of defence, finance, electricity and international cooperation -- that the revenue from exporting liquefied natural gas will multiply five-fold from $60 million in Fiscal Year (FY) 2003- 2004 to $400 million in FY 2005-2006. This increase will continue to multiply, reaching a staggering $11.8 billion by 2010. Revenues from exporting petrochemical products and natural gas are estimated at $210 million for FY 2003-2004. According to Fahmi, this will multiply nearly ten fold by 2010 to reach $2.5 billion.
Since July 1999, there have been 83 new crude oil and 44 natural gas discoveries -- most of them located in East Al-Zeit, Edfu and Saqqara. "These three locations give much hope in supporting Egypt's economy," Fahmi told the president. "Revenues from these fields alone are estimated at $2.6 billion." He added that one of the major incentives for investors to finance in Egypt's petroleum projects is "confidence in the country's stability and wise policies".
Fahmi also reviewed the major liquefied gas projects located at Edku and Damietta, which cost $1.4 billion and $1 billion respectively. The Edku compound set to be completed by 2005, will be exported to US, France and other European destinations. The Damietta complex will begin production by the end of 2004 and export to Spain and Italy.
Mubarak was also briefed by Ali El-Sa'idi, the minister of industry and technology development, about the ministry's plans to modernise production. This includes efforts to cooperate more fully with the private sector, as well as to develop the industry in satellite cities and industrial zones.
C a p t i o n : Mubarak discussing Egypt's petroleum and natural gas resources with the cabinet
Al-Ahram Weekly Online : 22 - 28 May 2003 (Issue No. 639)
Located at: http://weekly.ahram.org.eg/2003/639/eg1.htm