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British Gas postpones project due to late payment of government dues: Egygas official - Daily News Egypt

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British Gas postpones project due to late payment of government dues: Egygas official

Extension of Borollos fields project delayed until early 2016, claims official

BG groupA senior official in Egygas revealed that British Gas has postponed the project linking production phase 9B to the Borollos fields until the beginning of 2016, rather than the beginning of 2015 as outlined in the approved plan.

In special statement to Al-Borsa, the official said that British Gas’ postponement came as a result of the government’s lack of commitment in paying the company’s dues.

The official stated that the ministry promised foreign partners in the past to pay $700m in financial dues which were estimated at $1.85bn, but has not committed to that agreement and paid only $350m.

The official said that British Gas in currently in negotiations with the Ministry of Petroleum to adjust the gas price for the 9B phase in the Borollos fields beginning of 2016.

The official pointed out that British Gas will complete linking 500m cubic feet of gas per day from the 9A production phase during the current month, and the agreed plan with the ministry was to complete the linking project at the beginning of this year.

He pointed out that British Gas’ total production reached 1.1bn cubic feet per day after the completion of the 9A linking project, compared to 880m cubic feet per day previously.

It is expected that 9B phase would produce 500m cubic feet of natural gas per day.

The official also added that foreign partners in the oil sector responded to the government’s non-commitment to its promises to pay part of companies dues on time by delaying linking natural gas projects based on the agreed upon time schedule with the Ministry of Petroleum.

He said that the $1.5bn paid by the Ministry of Petroleum last month to foreign partners was supposed to be paid in June according to the agreement between the government and the companies.

The official added that Egypt’s total gas production amounted to 4.8bn cubic feet per day, and that the production decreased naturally at a rate of 100m feet per month.

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