Petroleum ministry halves supply of natural gas to cement factories

Daily News Egypt
3 Min Read
Establishment of higher council for building materials sought and introduction of new licence to control irregularly priced items (AFP File Photo)
The Ministry of Petroleum will reduce its supply of natural gas to cement factories by 50% starting from June, (AFP Photo)
The Ministry of Petroleum will reduce its supply of natural gas to cement factories by 50% starting from June,
(AFP Photo)

By Lamia Nabil 

The Ministry of Petroleum will reduce its supply of natural gas to cement factories by 50% starting from June to September, said Vice Chairman of the Titan Cement Company Medhat Estefanous responding to a question by Daily News Egypt.

Estefanous said that the Ministry held a meeting on Sunday with heads of major cement factories to announce the decision.

According to Mubasher, Minister of Petroleum Ossama Kamal did not attend the meeting.

“This decision will negatively impact our production lines by 50%,” said Estefanous. “This will directly translate into increases in cement costs.”

Secretary of the Building Materials Division at the Cairo Chamber of Commerce (CCC) Abdel Aziz Qasem said that cement factories in developed countries are responsible for providing their own energy supply, “but in Egypt cement factories depend on the government to supply their energy needs, and they receive subsidised energy as well”.

He also added that the amounts supplied by government are “limited” as “they try to save as much as possible”.

“Cement factories are already raising their prices,” he continued. “They are reducing their production rates, despite having very low production costs including low labour costs, low energy costs, and low raw material costs.”

He also mentioned that the current average cement price was EGP 670 per tonne, and that recently cement factories had raised their prices by EGP 200 per tonne. “The El-Arish Cement Company, which is owned by the Egyptian Armed Forces, raised their prices by only EGP 30 per tone,” he added.

Qasem also said the real estate sector had experienced a recession during the past two years, as building material price increases had created problems for the sector and led to increases in real estate prices.

Minister of Petroleum Ossama Kamal announced on Monday, during a meeting with the Industrial Production and Energy Committee at the Shura Council, that the Ministry was launching 11 new agreements to explore areas for oil and natural gas for the first time and with new contract terms, according to media reports.

Kamal said that these agreements were sent to the State Council for examination in preparation for submission to legislative institutions.

Share This Article
Leave a comment