Energy – Daily News Egypt https://www.dailynewsegypt.com Egypt’s Only Daily Independent Newspaper In English Thu, 23 May 2019 11:30:37 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.1 Egypt saves $350m by improving energy efficiency: Petroleum Ministry https://www.dailynewsegypt.com/2019/05/22/egypt-saves-350m-by-improving-energy-efficiency-petroleum-ministry/ Wed, 22 May 2019 21:10:52 +0000 https://www.dailynewsegypt.com/?p=698912 Joining World Bank’s Zero Routine Flaring by 2030, says source

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The ministry of petroleum succeeded in improving the efficiency of energy consumption in refineries and production units, which contributed to saving about EGP 350m annually.

A source at the ministry of petroleum told Daily News Egypt that Egypt aims to join the World Bank’s Zero Routine Flaring by 2030 initiative that aims to eliminate routine flaring no later than 2030.

He added that the ministry is currently preparing the legislative and institutional framework for the generalisation of the energy projects implementation nationwide.

He pointed out that the ministry is seeking to achieve the optimal economic exploitation of assets and contribute to reduce the import of petroleum products and petrochemicals and increase the revenues of those activities to achieve additional returns.

The ministry of petroleum is currently implementing a strategy to turn Egypt into a regional hub for the trade and circulation of gas and oil by benefiting from all the elements and infrastructure enjoyed by Egypt in the field of gas and oil.

Several important steps were accomplished, including the issuance of a gas production regulating law, establishment of a gas regulating agency, and signing of a memorandum of understanding for the strategic partnership in the field of energy with the European Union within the framework of the ongoing strategic dialogue between Egypt and the union in the field of energy.

The ministry increased the country’s daily oil production to 31,000 barrels of crude oil, 9,000 barrels of condensates, and 1.5bn scf/day of gas, along with offsetting natural production decline.

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New electricity tariffs will save EGP 16bn from overall electricity subsidies in FY 2020: Beltone https://www.dailynewsegypt.com/2019/05/22/new-electricity-tariffs-will-save-egp-16bn-from-overall-electricity-subsidies-in-fy-2020-beltone/ Wed, 22 May 2019 20:40:08 +0000 https://www.dailynewsegypt.com/?p=698918 The note added that the prices for higher consumption brackets, above 1,000 kW, remain unchanged at EGP 1.45/kW, as they already pay above the production cost of EGP 1.22/kW.

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The Ministry of Electricity’s announcement to increase household electricity tariffs by 20% on average would save around EGP 9.1bn from the household subsidy bill in FY 2019/20, and EGP 16bn from the overall electricity subsidies bill, Beltone said in a research note on Wednesday.

The note added that the prices for higher consumption brackets, above 1,000 kW, remain unchanged at EGP 1.45/kW, as they already pay above the production cost of EGP 1.22/kW.

Furthermore, tariffs for the commercial sector saw an increase of 14% on average, while the industrial sectors, including energy intensive ones, such as steel, saw an increase of 10%.  “The overall increase is therefore 15%, which comes below our estimate of 20%,” the report indicates.

This is the fourth round of revision to electricity tariffs since the onset of Egypt’s IMF-supported reform programme. The government has raised electricity tariffs by 40% in July 2016, 47% in 2017, and 35% in 2018, on average. Beltone notes that the timeline for the phasing-out of electricity subsidies was extended to 2021.

The government expects 50% reduction in electricity subsidies allocation to EGP 16.5bn down from EGP 33.5bn in FY 2018/19. Beltone believes that the reduction in subsidy bill will improve the fiscal balance in FY 2019/20, with deficit falling to 7.8% of GDP, down from an expected 8.6% in FY 2018/19.

Hike accounted for in our inflation estimates; reiterate our call of maintained interest rates in the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) meeting on 23 May.

Accordingly, Beltone reiterate their view of an expected 2.5-3.5% increase to annual headline inflation throughout third quarter of 2018 driven by the fourth round of fuel and electricity subsidies cuts, and the third increase in water prices.

Thus, the report foresees inflation averaging 13.7% in the second half (H2) of 2019, almost flat from H1 of 2019, average of 13.3%.

However, Beltone believes inflation will remain within the CBE target zone, and maintain their view of a maintained interest rates decision in the 23 May meeting.

Furthermore, the report forecasts a very limited direct impact on margins for consumer and healthcare stocks.

“However, we believe the hike will have a considerable impact on several industrial players, notably Ezz Steel and Arabian Cement. On the other hand, we had already factored in until 2021 the impact of electricity price hikes in the real estate sector,” the report concludes.

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Egypt, EuroAfrica agree to implement interconnector cable with Cyprus, Greece https://www.dailynewsegypt.com/2019/05/22/egypt-euroafrica-agree-to-implement-interconnector-cable-with-cyprus-greece/ Wed, 22 May 2019 20:13:49 +0000 https://www.dailynewsegypt.com/?p=698902 With regard to the electrical connection with Sudan, she explained that all the works and lines of the project have been completed, and the current phase is supposed to be the experimental operation, but it was postponed because of the unstable political situation in Khartoum.

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The Egyptian Electricity Transmission Company (EETC) signed an agreement, on Wednesday, with EuroAfrica Interconnector to implement the electricity interconnection project between Egypt, Cyprus, and Greece.

Sabah Mashaly, the EETC chairperson, said that the framework agreement includes activating the project after reviewing its technical studies in coordination with the Cyprus officials. He revealed that the technical issue of the location of the landing point and the electrical cables were resolved.

She explained that the project is part of Egypt’s strategic plan to achieve economic development and energy security, and helps to link Egypt to the European electricity network.

She added that the implementation of the interconnection project strengthens the partnership between Egypt and Cyprus as well as realising their advantages, especially after taking into account the recent developments in the energy sector and as expectations of increasing the demand for electricity production according to development requirements.

Furthermore, Mashaly said that there is coordination with Saudi officials to implement the interconnection project between the two countries with a capacity of 3GW, where studies for the new lines are being completed and is expected to conclude in December.

With regard to the electrical connection with Sudan, she explained that all the works and lines of the project have been completed, and the current phase is supposed to be the experimental operation, but it was postponed because of the unstable political situation in Khartoum.

Egypt is electrically connected with the neighbouring countries in the east and west, Jordan and Libya. A feasibility study is being prepared to increase the capacity of the electric connection line with Jordan to reach 2GW, instead of 450MW through linking on high-voltage direct current system.

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Households electricity prices hike by EGP 4-93.5 per month https://www.dailynewsegypt.com/2019/05/21/households-electricity-prices-hike-by-egp-4-93-5-per-month/ Tue, 21 May 2019 18:54:12 +0000 https://www.dailynewsegypt.com/?p=698729 EGP 17bn proceeds of Electricity sector from price increases

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Egypt’s Minister of Electricity Mohamed Shaker revealed the new electricity prices, with an average increase of 14.9% to be implemented starting from next fiscal year (FY) during a press conference on Tuesday. The increase in the value of the electricity bill starts from EGP 4-93.5 depending on consumption.

According to Shaker, the first category in terms of consumption, from 0 to 50 kW’s new price is EGP 0.30; from 51 to 100 kW it is EGP 0.4; from 101 to 200 kW it is EGP 0.5,; from 201 to 350 kW it is 0.82; from 351 to 650 kW it is EGP 1; from 651 to 1,000 kW it is EGP 1.4, and the seventh bracket of more than 1,000 kW it is EGP 1.45 instead of EGP 1.35.

Furthermore, the ministry revealed that the consumption category between 101-200 kW has the highest number of electricity subscribers, with 9.5 million users, or around 36% of the total users, followed by the 201-350 with 6.8 million users, or 25.7%.

Shaker explained that the Ministry of Finance is still supporting the electricity sector by EGP 16.5bn billion during the fiscal year 2019/20, and that the result of the price increase of will be EGP 17bn.

The minister told Daily News Egypt that Shaker the prices remained low compared to neighbouring countries for ultra-high, high and medium-level voltage.

He explained that the factories bear a higher cost to support household uses and not to burden the citizens, adding that “ There is no other solution, there must be mutual subsidies”

He explained that the average price of the sale of electricity 96.1 piasters, and the average cost on the low voltage 114.2 piasters per kilowatt hour, did not increase the bill for electricity consumption of more than 1000 KW/h.

On the other hand, the tariff for ultra-high-voltage (UHV) consumers in FY 2019/20 will be EGP 1.09 per kW, increasing by 10%; EGP 1.17 per kW for high-voltage increasing by 9.1%; EGP 1.23 per kW for medium-voltage increasing 9.9%, and EGP 0.83 per kW for (LV) low-voltage increasing by 19%.

The tariff for the current FY was EGP 0.99 per kW for UHV consumers; EGP 1.08 per kW for high-voltage; EGP 1.12 per kW or medium-voltage, and EGP 0.71 per kW for LV.

LV consumers use medium, high, and ultra-high-voltage networks so its tariff is higher.

The new tariff was based on the dollar exchange rate between EGP 17.5-17.78 and a natural gas price of $3 per million thermal units, and in the event of a decline in the dollar rate, prices will be revised.

He said that the cost of natural gas on the state is more than $4.5 per million thermal units, and bought by power plants at $3. The fuel received by the electricity sector reached EGP 80bn, including EGP 66bn for gas so if the price paid is not real, a gap of EGP 37bn will be created.

The minister revealed that household consumption makes up around 42.1% of Egypt’s total electricity consumption, while industrial uses stand at around 27.9%.

Consumers of over 1,000 kW will pay more to subsidise low-income citizens.

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El-Molla inspects situation to implement expansion of SIDPEC, Midor https://www.dailynewsegypt.com/2019/05/20/el-molla-inspects-situation-to-implement-expansion-of-sidpec-midor/ Mon, 20 May 2019 14:55:44 +0000 https://www.dailynewsegypt.com/?p=698581 Midor expansion project will achieve 60% increase in production capacity, says ElKareish

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The Minister of Petroleum, Tarek El-Molla,  inspected the situation of implementing the new projects and expansions of SIDPEC and Midor.

According to Mosaad El Kasaby, the chairperson of SIDPEC, the project of the new “propylene derivatives complex” expansion is underway with investments of $1.2bn to produce 500,000 tonnes of propylene and 450,000 polypropylene.   

El Kasaby pointed out that the project is an investment of the current increase in the production of natural gas, and the fruitful integration between companies and entities in the oil sector.

Furthermore, he added that SIDPEC has provided the local market needs of ethylene and polyethylene products, and exported the surplus in order to provide foreign currency to meet the needs of the market and support the national economy.

“The investment cost of Midor’s expansions is estimated at $2.3bn,” said Gamal ElKareish, chairperson of the company.

He pointed out that the project aims to increase the production capacity of the plant by 60%, and Petrojet is currently preparing the land of the site where construction will take place, as engineering designs of the location are almost finished, in cooperation Enppi and Technip. Petrojet is also working to overcome the challenges of the new expansion, most importantly, connecting the existing units to the plant and the new units.

ElKareish highlighted that a contract will be signed with Midor Electricity this week to provide the required electricity for the plant.

Throughout the inspection tour, El-Molla held a meeting of the higher refining committee during which he discussed several projects to increase the refining capacity. He started the meeting by reviewing the situation of the work progress in the hydrocracking project of mazut in Assiut, which is implemented by the Assiut National Oil Processing Company (ANOPC) to secure the needs of Upper Egypt.

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Oil surges above $72 per barrel awaiting regional political movements https://www.dailynewsegypt.com/2019/05/19/oil-surges-above-72-per-barrel-awaiting-regional-political-movements/ Sun, 19 May 2019 20:39:55 +0000 https://www.dailynewsegypt.com/?p=698460 Bank of America expects Brent to rise to $90 per barrel

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Oil prices in global markets stabilised at around $72.11 per barrel at the close of trading after two Saudi oil tankers were attacked, with markets eyeing political moves in the region that would have a big impact on oil.

Medhat Youssef, former deputy head of the Egyptian General Petroleum Corporation, told Daily News Egypt that the attacks confused the oil markets, because one fifth of the consumption of world oil producers of crude oil in the Middle East passes to the main markets in Asia, Europe, and North America and beyond through the Straits of Hormuz, which separates Iran from the Arabian Peninsula.

The Bank of America Merrill Lynch expected Brent crude oil to rise to $90 a barrel as the trade war between the United States and China ebbed, the dollar fell, and world oil demand increased, along with changes approved by the International Maritime Organization for the fuel shipping rules.

Saudi Arabia has announced attacks on two pumping stations to the East-West pipeline, which is transporting Saudi oil from the fields in the east region to the port of Yanbu on the west coast. It has not had a big impact on the markets after the Kingdom announced that its oil supplies were not impacted.

Saudi Arabia and the UAE are the top and third largest producers respectively in the Organization of the Petroleum Exporting Countries (OPEC), according to the latest survey.

Youssef pointed out that the return of the application of US sanctions on Iran and Venezuela will lead to a further decline in crude exports from OPEC member countries, adding to the restriction of supplies resulting from the agreement led by the organisation. Tensions in the Middle East this week also raised fears of additional supply disruptions.

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Egypt seeks to increase gas production to 7.95bn scf/day in FY 2019/20: petroleum ministry https://www.dailynewsegypt.com/2019/05/19/egypt-seeks-to-increase-gas-production-to-7-95bn-scf-day-in-fy-2019-20-petroleum-ministry/ Sun, 19 May 2019 13:53:59 +0000 https://www.dailynewsegypt.com/?p=698426 New projects to compensate natural decline of gas fields, estimated to be 10%, says source

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The ministry of petroleum seeks to increase Egypt’s natural gas production to 7.95bn cubic feet per day (scf/day) over the upcoming fiscal year (FY) 2019/20, instead of the estimated 7.5bn scf/day in the plan, through connecting the second phase of the North Alexandria project and increasing the production of the Zohr field.

A source in the petroleum sector told Daily News Egypt that the projects currently underway will add about 1.15bn scf/day to the natural production estimated to be 6.8bn scf/day, compensating for the 10% natural decline of the total current production.

He pointed out that Zohr’s production will increase with the development of the second phase by July to 2.95bn scf/day instead of the current 2.3bn scf/day.

The source added that the ministry of petroleum seeks to complete the following phases of Zohr, North Alexandria, and 9B projects to speed up the full connection of the projects’ production in order to compensate the decline rate and increase production rates, in addition to developing 11 gas projects in various concession areas up until 2023 with investments worth $18bn to compensate the decline by 2bn scf/day.

He said that the projects include the wells of West Borollos, North Tort, South Seth, Rahmat, Satis, Salamat, Merit, Tinine, Waten, and Terra.

He added that natural gas consumption rates in the local market are growing annually according to the industrial and urban development plan with the increase of the number of cars which operate with natural gas.

The average consumption of the local market will increase to about 9bn scf/day by FY 2020/21, according to the plan of industrial development and increasing the electric energy produced, as well as delivering gas to homes, as well as turning the largest number of cars to operate with gas instead of petroleum products.

Imported shipments of liquefied gas will stop as self-sufficiency is achieved. The gasification ship affiliated to Norwegian Singaporean BW Gas company will also be utilised to meet the needs in case importation of gas was required.

The source stressed that the ministry is working to encourage foreign partners to implement development projects and increase investments in Egypt.

Furthermore, the ministry of petroleum seeks to increase the production of the current gas fields and complete the development of the discovered gas fields.

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Egypt to announce new electricity prices within days https://www.dailynewsegypt.com/2019/05/18/egypt-to-announce-new-electricity-prices-within-days/ Sat, 18 May 2019 17:31:41 +0000 https://www.dailynewsegypt.com/?p=698315 EGP 1.14 per kW/h for LV consumers, EGP 0.75 for UHV consumers

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The Egyptian government will announce within a few days the new electricity prices to be implemented starting from next fiscal year (FY) after being approved by the Egyptian Electric Utility and Consumer Protection Regulatory Agency (EgyptERA) and approved by the cabinet.

Sources from the ministry of electricity told Daily News Egypt the tariff for ultra-high-voltage (UHV) consumers will be EGP 0.75 per kW/h, EGP 0.79 per kW/h for high-voltage, EGP 0.95 per kW/h for medium-voltage, and EGP 1.14 per kW/h for (LV) low-voltage.

The tariff for the current FY was EGP 0.99 per kW/h for UHV consumers, EGP 1.6 per kW/h for high-voltage, EGP 1.13 per kW/h for medium-voltage, and EGP 0.71 per kW/h for low-voltage.

LV consumers use medium, high, and ultra-high-voltage networks so its tariff is higher.

According to the sources, the UHV voltage gets fed directly from the grid, while high-voltage passes through two grids: the medium-voltage which includes production costs and tariff on using two grids, while the low voltage costs include production and transmission through all grids.

According to the sources, the tariff reduction of ultra-high, high, and medium voltage in FY 2019/20 is because consumers pay for production and transmission. In FY 2018/19, consumers of these voltages are given higher tariffs to subsidise consumers of low voltage.

The sources added: “We do not want to charge ultra-high, high, and medium voltage consumers additional burdens affecting their competitiveness and the cost of the final product to citizens, a system which is followed by many countries in Europe.”

The new tariff was based on the dollar exchange rate between EGP 17.5-17.78 and a natural gas price of $3 per million thermal units, and in the event of a decline in the dollar rate, prices will be revised.

The sources said that there is a fluctuation in the US dollar price, so it cannot be fixed and if it remains low, the tariff will be changed.

The sources pointed out that the rates of increase in domestic consumption segments vary according to the volume of consumption.

The increase in the value of the electricity bill starts from EGP 6-10 to EGP 160-200 depending on consumption.

Consumers of over 1,000 kW/h will pay more to subsidise low-income citizens.

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Khartoum’s political unrest casts shadow over Egypt-Sudan electrical interconnection https://www.dailynewsegypt.com/2019/05/15/khartoums-political-unrest-casts-shadow-over-egypt-sudan-electrical-interconnection/ Wed, 15 May 2019 18:08:14 +0000 https://www.dailynewsegypt.com/?p=698241 A delegation from Sudan was supposed to visit Egypt and start the project but this has not happened so far.

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Although the Egyptian Electricity Transmission Company (EETC) has completed linking the extension of the Toshka substation to the electric interconnection project with Sudan and its willingness to export and exchange energy with the neighbouring country, but the fate of the project remains unknown due to the ongoing events and political unrest in Khartoum.

Sami Abdou, a manager at the EETC for Upper Egypt, told Daily News Egypt that a high-level delegation headed by Sabah Mashali, head of the EETC, visited Sudan to follow up the developments of the electricity interconnection project between the two countries. A delegation from Sudan was supposed to visit Egypt and start the project but this has not happened so far.

He explained that the project cannot be operated without the Sudanese officials’ visit to find out who will be dealt with and supply electricity in the network, and provide mutual information between the Egyptian and Sudanese sides on lines and switches and protection and communication devices.

Abdou stressed that Egypt has completed the implementation of 100km of lines until Arqin. The two sides should agree on the exchange of capacity and the amount of energy Egypt will supply to Sudan.

He pointed out that Egypt will export electricity to Sudan and will not exchange it, especially since the electric capacity reserves on the electrical grid are between 15-18MW per day.

Abdou stressed that the construction of a national network for the transfer of electricity is strong and high efficiency is one of the main components of Egypt’s vision to export surplus electricity to neighbouring countries.

The first phase of the Toshka 2 transformer station, going to the Arqan transformer station in Sudan, starts at 220kV, rising in the second phase to 500kV.

The project is part of Egypt’s plan to become a regional energy hub, which also includes two similar projects, the first with Saudi Arabia with a capacity of 3,000MW at a cost of $1.6bn, and the other is with Cyprus and Greece at a capacity of 2,000MW with initial investments of $4bn.

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Oil prices jump $0.90 per barrel, following Aramco pipeline, two Saudi oil tankers attacks https://www.dailynewsegypt.com/2019/05/14/oil-prices-jump-0-90-per-barrel-following-aramco-pipeline-two-saudi-oil-tankers-attacks/ Tue, 14 May 2019 19:04:03 +0000 https://www.dailynewsegypt.com/?p=698135 Political moves resulting from these attacks will affect oil market, says expert

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Oil prices jumped to around $71.14 per barrel at the beginning of Tuesday, an increase of $0.9, after reports of drone attack at oil pumping stations in Saudi Arabia on Tuesday, following the two Saudi oil tankers were attacked off the coast of the UAE on Monday.

“The political moves in the region resulting from this attack will have a significant impact on the oil prices in world markets,” said Medhat Youssef, former deputy head of the Egyptian General Petroleum Corporation.

He referred to the imminent return of United States sanctions on Iran and Venezuela, reducing their oil exports, in addition to continuing production cuts implemented by the Organization of the Petroleum Exporting Countries (OPEC) members and non-members, which contribute to oil price hikes.

Saudi Arabia said on Monday that two of its oil tankers were among the four ships attacked off the coast of the UAE, describing the attack as an attempt to threaten the security of international oil supplies, amid a state of tension between the US and Iran.

Saudi Arabia and the UAE are the first and third largest oil producers, respectively, in the OPEC, according to the latest survey.

The UAE said on Sunday that four merchant ships had been sabotaged near the emirate of Fujairah, one of the world’s largest ship refuelling centres, just outside the Strait of Hormuz. Youssef pointed out that one fifth of the world’s oil consumption of crude oil producers in the Middle East to the major markets in Asia, Europe, and North America and beyond, passes through the Straits of Hormuz. The waterway separates Iran from the Arabian Peninsula.

He stressed that the OPEC meeting next month to discuss the extension of the reduction of oil production will lead to divisions among member states if the price of oil continues to rise above $70 a barrel.

Washington withdrew last year from the 2015 agreement between Iran and world powers aimed at curbing Iran’s nuclear ambitions. Since then, the US has tightened sanctions on Iran, saying it wants to cut its oil exports to zero.

Iran’s Revolutionary Guards, classified by the US as a terrorist organisation, last month threatened to close the strait if Iran was prevented from using it.

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Saudi oil-pumping stations attacked by drones https://www.dailynewsegypt.com/2019/05/14/saudi-oil-pumping-stations-attacked-by-drones/ Tue, 14 May 2019 15:38:55 +0000 https://www.dailynewsegypt.com/?p=698070 Houthi-run Al-Masirah TV cited military official saying seven drones staged attacks on vital Saudi installations

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Two Saudi oil-pumping stations affiliated with the east-west pipeline had been hit by explosive-laden drones, Saudi Minister of Energy, Industry, and Mineral Resources, Khalid Al-Falih, said on Tuesday.

Al-Falih described the attack as “an act of terrorism” that targeted global oil supplies. This is the latest development since Saudi ships were attacked near the United Arab Emirates territorial waters.

It comes a day after Riyadh said two of its oil tankers were among four vessels attacked off the coast of the UAE on Sunday.

The minister, however, did not vocally accuse the Houthis of executing the attack.

Nevertheless, Al-Falih was quoted by Reuters saying that Saudi oil outputs and exports for crude and refined products were continuing without disruption. The agency added that that the state oil giant Aramco had halted oil pumping in the pipeline while the damage was evaluated, and the stations were repaired.

He added that a fire broke out in one of the stations as a result of the attack, but was quickly contained.

Al-Falih added that the drone attack was conducted with the aim of disrupting world oil supplies.

The energy minister said that Saudi oil production and exports will still continue uninterrupted, adding that the attack “proves the importance of confronting all terrorist organisations.”

In the same context, Al-Masirah, a television station run by Yemen’s Houthi group, said on Tuesday it had launched drone attacks on Saudi installations, without identifying the targets.

Al-Masirah report cited a Houthi military official as saying that “seven drones carried out attacks on vital Saudi installations.” On Twitter, Al-Masirah cited the official as saying, “This large military operation is in response to the continued aggression and blockade of our people and we are prepared to carry out more unique and harsh strikes.”

The Houthis have repeatedly launched drone and missile attacks on Saudi Arabia and claimed to have launched drone attacks on the UAE.  A Sunni-Muslim coalition led by Saudi Arabia intervened in Yemen in March 2015, to push back against an advance by the rebels and restore power to President Abed Rabbo Mansour Hadi.

In December 2018, UN secretary-general Antonio Guterres said Yemen’s warring factions had agreed on measures for the embattled Red Sea province of Hodeida, including a ceasefire for its rebel-held port city, part of a key conduit blocked in the past for humanitarian aid deliveries.

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Benban investors, EETC dispute over cost-sharing hike threatens project https://www.dailynewsegypt.com/2019/05/14/benban-investors-eetc-dispute-over-cost-sharing-hike-threatens-project/ Tue, 14 May 2019 15:34:04 +0000 https://www.dailynewsegypt.com/?p=698071 Cost-sharing value up 130%, companies hint at possible resort to arbitration 

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Investors of the solar energy feed-in tariff projects in Benban, Aswan has experienced a big crisis after the Egyptian Electricity Transmission Company (EETC) asked to pay extra EGP 1.9bn as part the cost-sharing. This increase is 130% of the main value of the project’s cost-sharing. 

The decision angered all investors and some companies hinted at resorting to arbitration.

Sources in the ministry of electricity told Daily News Egypt that the reason for the recent increase is due to the rise in the prices of infrastructure and transformer stations. This increase will not be borne by the ministry but will be applied to investors.

The sources added that the contracts signed with the investors for the cost-sharing agreement do not identify a limit for the cost-sharing value. However, the high prices pushed the EETC to increase the cost-sharing value. The EETC informed the banks financing the Benban projects of the increase and they did not object, but they are still in negotiation.

The sources said that the EETC paid about EGP 1.1bn for contractors who built the transformer stations in Benban.

The cost-sharing agreement is one of the five agreements signed by eligible investors for the establishment of new and renewable energy projects in accordance with the feed-in tariff system. These include participation in the cost of linking the production of solar power plants to the national electricity grid.

According to the sources, the consultant who was hired by investors to evaluate the cost-sharing told them: “We did not know about the increase, until the consultant told us. We will not pay anything.”

This is the third time that the EETC increases the value of cost-sharing. The increase includes doubling the main road between Cairo and Aswan at a cost of EGP 60m.

Daily News Egypt spoke with eight solar power operators in Benban who expressed their frustration of these actions by the EETC. They confirmed that they are still discussing the issue with legal consultants.

Head of a company newly completed with a capacity of 50MW in Benban said these decisions cannot be applied without study as they would affect the investment climate in Egypt.

“There was an item in the cost-sharing agreement that mentions the value of cost-sharing to be paid by investors, but it has been removed and replaced by ‘cost settlement’,” he said. “How come we contract for transformer stations and be surprised by an increase in their prices every few months! Who guarantees that we will not be surprised by similar decisions?”

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EETC to negotiate with ACWA Power over Kom Ombo solar plant https://www.dailynewsegypt.com/2019/05/13/eetc-to-negotiate-with-acwa-power-over-kom-ombo-solar-plant/ Mon, 13 May 2019 07:30:41 +0000 https://www.dailynewsegypt.com/?p=697914 Company sells energy at 2.75 piasters, contracts to be signed in August

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The Egyptian Electricity Transmission Company (EETC) will begin negotiating with Saudi ACWA Power this week to launch a 200MW solar power plant in Kom Ombo after the company had presented the lowest financial offer.

The committee formed to evaluate selling offers found that the lowest price was offered by ACWA Power at 2.75 piasters. Negotiations over contracting will be concluded by the end of August, sources in the EETC told Daily News Egypt.

The El Sewedy – EDF – Marubeni alliance offered to sell energy at 3.15 piasters in the tender, while the Actis-Energal alliance offered 3.517 piasters.

Scatec offered 3,045 piasters and Orascom’s alliance offered 3.4 piasters, while FRV offered 2.79 piasters.

The sources pointed out that the committee did not delay in settling the tender, especially as it has many aspects that need to be reviewed, as well as the feed-in tariff projects that will enter the service by the end of the current year.

The Kom Ombo solar power project is one of the most prominent projects in the ministry of electricity’s five-year plan, which aims to involve the private sector in the implementation of 67% of the projects set to add about 3,500MW.

According to the sources, the price offered by the Saudi company ACWA Power will be a guiding price if investors or companies request to implement solar energy projects and sell electricity produced to the EETC.

The ministry of electricity aims to produce 20% of the country’s electricity from renewable sources by 2022. The ministry aims to implement this strategy through cooperation with the private sector and implement projects on different contractual schemes.

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Saudi alfanar eyes $1.6bn worth renewable energy projects until 2021 https://www.dailynewsegypt.com/2019/05/13/saudi-alfanar-eyes-1-6bn-worth-renewable-energy-projects-until-2021/ Mon, 13 May 2019 07:00:48 +0000 https://www.dailynewsegypt.com/?p=697906 Company intends to launch a wind farm in Egypt with investments of $250m

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Saudi Arabia’s alfanar aims to launch new solar and wind power plants with total capacity of 1.6GW and investments of $1.6bn until 2021, including a $250m worth wind farm in Egypt.

Daily News Egypt interviewed Jamal Wadi, CEO of alfanar Global Development; Ahmed Ibrahim Soliman, division manager at alfanar; and Mahmoud Abdel Fattah, regional manager of the company, to learn about its investment plans in Egypt, the size of the projects it aims to implement, and the challenges the company is facing.

Jamal Wadi, CEO of alfanar

What is the total capacity of the energy projects your company is building?

alfanar signed contracts to implement energy projects with total capacity of 1.4GW, including a 720MW project in Spain, another 600MW project in India, a 50MW solar power plant in Egypt’s Benban, and a 30MW power plant in Britain. alfanar aims to sign new deals for 1.6GW energy projects to bring its projects’ total capacity to 3GW until 2021.

What is your strategy regarding renewable energy projects in Egypt?

Wadi: alfanar has completed the inauguration of its solar power plant in Benban, Aswan, as part of the feed-in tariff programme. It was the company’s first project in the Egyptian market, especially in the renewable energy sector. The company aims to invest the project’s revenues in implementing further projects.

Ibrahim: The company seeks to implement a wind farm with a capacity of 250MW and investments of $250m. We are still negotiating with the Egyptian Electricity Transmission Company (EETC) over the contractual system. The company will begin arranging the required funding for the project after signing the agreement.

What is the contractual system that the company seeks to follow?

Wadi: The company aims to implement its projects under the independent power producer (IPP) system to sell energy directly and pay the EETC for using the national grid. If the legislations and controls are completed, the company will implement its projects under this system, as Saudi Arabia has many similar projects.

How do you evaluate the investment and legislative climate of energy projects in Egypt?

Ibrahim: The new energy legislations issued in Egypt and the government’s strategy to attract long-term investments and produce 20% of the country’s electricity from renewable sources by 2022, have encouraged the company to establish new energy projects in the country.

alfanar aims to expand in establishing renewable energy projects in the coming years after the success and completion of its 50MW solar power plant in Benban.

What challenges did the company face in Egypt?

Abdel Fattah: The most prominent challenge faced by the company in the implementation of energy projects in Benban was the timetable of implementing the project, linking its production to the national grid, and start the commercial operation of the plant, which enabled alfanar to sell its production to the EETC.

alfanar owns a group of companies specialised in the construction works, civil engineering, and manufacturing steel, electric cables, control panels, transformers, and electric pistons.

What is the size of the company’s sales? Do you have any intention to acquire companies?

Wadi: alfanar achieved sales of $1.2bn in 2018 and plans to increase it this year, as the company seeks to expand in the Arab and European markets. alfanar has recently acquired $250m worth companies. The companies include ZIV in Italy, Safa in Turkey, and Contactum of Britain. All these companies operate in electrical equipment field. We will soon acquire a construction company in India.

Do you plan to acquire an Egyptian company?

Wadi: We are already following several small and medium Egyptian companies whose sales range between $100m and $150m per year to match the financial capacity of the company.

It is also possible to acquire a company that works with us at the solar power station in Benban.

He pointed out that the political and economic stability and the high credit rating of Egypt and the legislation and regulations governing investment, encouraged alfanar to invest in Egypt, expand its projects, and plan to implement several stations in the energy sector.

What are the most important features of the company’s investment plan in Egypt?

alfanar is studying investment in the field of energy-from-waste, especially since we have three similar projects in Britain. We are waiting to prove the success of these projects and the technology used to implement them to inaugurate them in Egypt. But, firstly, a suitable legal framework is required to control this field.

He pointed out that the company welcomes cooperation with the alliances eligible for the establishment of new and renewable energy projects in accordance with the procedures and rules followed, excluding the idea of listing the company on the Egyptian Exchange.

What is the difference between renewable energy legislation in Egypt and Saudi Arabia?

Wadi: There is a difference between the legislation and laws governing the investment in Egypt and Saudi Arabia. Egypt preceded Saudi Arabia to put forward a comprehensive plan on a large scale to implement plants to produce electricity from renewable resources.

alfanar also participate in the civil engineering works and civil works of the NEOM project in cooperation with the international companies and alliances involved in its implementation.

The Saudi Crown Prince Mohamed bin Salman announced in October 2017 a plan to establish the NEOM project with investments of $500bn, located northwest of the kingdom on an area of 10,200 sqm.

The project overlooks from north and west on the Red Sea and the Gulf of Aqaba, along 468 km, surrounded by 2,500m high mountains from the east. The project will focus on nine investment areas and will be completed by 2025.

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Petroleum ministry aims to develop 11 gas projects with $18bn investments until 2023 https://www.dailynewsegypt.com/2019/05/12/petroleum-ministry-aims-to-develop-11-gas-projects-with-18bn-investments-until-2023/ Sun, 12 May 2019 16:04:16 +0000 https://www.dailynewsegypt.com/?p=697868 New gas discoveries will contribute to connecting 2bn scf/day to national grid, says source

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The ministry of petroleum aims to develop 11 gas projects in various concession areas until 2023 with investments estimated at $18bn to compensate the natural decline rates and increase production.

A source at the Egyptian Natural Gas Holding Company (EGAS) told Daily News Egypt that the targeted gas projects will produce a total of 2bn scf/day, according to the results of search and exploration.

He added that the projects will include wells of West El Burullus, South Seth, North Tort, Salamat,

Rahmat, Satis, Tennin, Merit, Aten, Tersa, and Salmon.

The source explained that the projects planned to be implemented in the field of developing natural gas fields were recently discovered by foreign partners.

The source pointed out that Egypt’s production of natural gas is likely to increase to 7.5bn scf/day over the next fiscal year, compared to 6.8bn scf/day currently.

He added that the new projects to be linked to production such as Zohr, Noras, North Alexandria, and 9B contributed to offset the rates of the natural decline of fields and increased production.

Furthermore, the average consumption of natural gas in the domestic market is growing annually, according to the industrial and construction development plan and with the increase in the number of cars operating with natural gas, he elaborated.

The average consumption of the domestic gas market will rise to about 9bncfd by 2020/21, according to the industrial development plan, and increase the production capacity of electricity and the delivery of gas to homes as well as convert more cars to operate by gas instead of petroleum. In addition, it will stop the import of liquefied natural gas (LNG) shipments while achieving local self-sufficiency.

The Singapore-based Norway’s BW Gasification vessel will be used in the event of gas import.

The source stressed that the ministry is working to stimulate foreign partners to implement development projects and increase their investments in Egypt.

The ministry of petroleum aims to increase the productivity of the existing gas fields, complete the development of the discovered gas fields, and accelerate the pace of work in order to put them on the production map, thus contributing to compensating the natural decline in the productivity of the old fields.

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Cabinet approves amendments to Mineral Resources Law, sends it to parliament https://www.dailynewsegypt.com/2019/05/11/cabinet-approves-amendments-to-mineral-resources-law-sends-it-to-parliament/ Sat, 11 May 2019 15:46:56 +0000 https://www.dailynewsegypt.com/?p=697751 Amendments approved by concerned authorities to be discussed in parliament on Tuesday, says source

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The cabinet approved the amendments proposed by the ministerial working group, formed under the chairmanship of the minister of petroleum and mineral resources, to amend the Mineral Resources Law No. 198 of 2014 and will be sent to the House of Representatives for discussion and approval on Tuesday.

A source in the petroleum and mineral resources sector told Daily News Egypt that the amendments to the Mineral Resources Law were prepared by consensus of all concerned parties in the sector of investors and the government.

He pointed out that the working group consulted governors who have mineral resources in their governorates, in addition to the Federation of Egyptian Industries.

The sources pointed out that the amendments came in a number of articles to suit and conform to what the state seeks at currently in order to define clear methods and controls for the exploitation of mines and quarries, while avoiding any negative aspects of existing legislation and remaining in line with the current social, economic, and political conditions.

The source pointed out that the most important amendments to the Mineral Resources Law is the establishment of a new competent authority to issue licenses for mines and quarries, and that the new competent authority is to grant licenses for areas without restriction of a certain area after being limited to about 16,000 sqm.

In addition, it allows renewing licenses for similar periods after they were limited for only one term, and the revocation of the license if the work stops for six consecutive months after the text previously contained in the law provided for a stop for only three months.

The amendments to Article 3 states that “the licenses of mines and quarries issued prior to the operation of the annexed law shall continue to be valid and the provisions therein shall remain in force and the provisions of the annual rent, royalty, and licensing fees for research and exploitation contained in the accompanying law shall apply to such licenses upon renewal.”

The source pointed out that the amendments confirmed the competence of the Egyptian General Authority for Mineral Resources in the search for mines, as well as its right to technical supervision of the exploitation of mines and quarries.

The draft law on mineral wealth comes within the framework of the Egyptian state’s efforts to achieve development plans, pursue global developments in mining, restructure and develop the mineral wealth sector. The objectives of the law are to optimise the use of mineral resources.

In addition, there is the activation of scientific research in the fields of geological and mining exploration as well as mining, to provide the country’s needs of mining materials and quarries, and establish industrial projects on mining and quarries’ materials in order to achieve the optimal benefit of this wealth and maximise the added value, as well as develop projects and industrial zones based on mineral wealth.

This is in order to attract more international and domestic investments and increase the contribution of the mineral wealth sector in the national economy in addition to maximising the returns for the state.

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New electricity tariff to be imposed in July https://www.dailynewsegypt.com/2019/05/11/new-electricity-tariff-to-be-imposed-in-july/ Sat, 11 May 2019 15:42:09 +0000 https://www.dailynewsegypt.com/?p=697770 electricity pricing schemes to be submitted to cabinet for approval within weeks

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Egyptian Electric Utility and Consumer Protection Regulatory Agency has prepared the electricity pricing schemes for the fiscal year (FY) 2019/20 and will be submitted to the cabinet for approval by the end of this month.

Electricity ministry sources told Daily News Egypt that the increase in electricity prices will be variable according to consumption rates and income. The most affected segments of the new price increases are those consuming more than 1,000KW monthly, and this increase will be used to decrease electricity prices for low-income segments with lower consumption rates, in what is known as cross subsidisation.

The sources pointed out that the exchange rate of the pound against the US dollar and the price of natural gas is a major factor in determining the increase rate in electricity prices.

The agency set the new pricing schemes based on the US dollar exchange rate of EGP 17.5 and the natural gas price of $3 per 1 million Btu.

The government’s 2014 plan aimed at phasing out electricity subsidies on all sectors gradually over the next five years, to be fully liberalised by 2019, however this period was extended to three more years in order not to overburden the citizens.

According to the Electricity Act No. 87 of 2015 and its executive regulations, the Egyptian Electric Utility and Consumer Protection Regulatory Agency is responsible for calculating the tariff of selling electricity.

The sources added that the new prices will be applied starting of July bills which are issued in August, but “low-income segments will not be affected by this increase.”

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Gas Market Regulatory Authority shall transfer 25% of its revenues to the Ministry of Finance https://www.dailynewsegypt.com/2019/05/08/gas-market-regulatory-authority-shall-transfer-25-of-its-revenues-to-the-ministry-of-finance/ Wed, 08 May 2019 19:56:08 +0000 https://www.dailynewsegypt.com/?p=697588 Authority follows commitment of companies to licensed activity to regulate gas market: Source

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The Law for the Establishment of the Natural Gas Market Regulatory Authority stipulates that 25% of the annual revenues of the ministry of finance shall be transferred to the ministry of finance.

A source at the authority told Daily News Egypt that the authority is currently organising the internal market for the domestic distribution of natural gas by monitoring and following-up on the companies that have obtained licenses for “shipment, supply, and distribution” in order to ensure their compliance with the requirements of the activity.

He pointed out that the agency issued about 18 private and government companies to practice the “shipping, supply, and distribution” of natural gas in the local market.

The source also said that two licenses were issued to the Egyptian Natural Gas Holding Company (EGAS) to practice the activity of “shipping and supply” of natural gas to the domestic market.

He added that the Egyptian Natural Gas Company (GASCO) obtained three licenses for the “transport, distribution, and supply” of gas, by the committee formed by the gas market regulator to grant licenses to companies.

The source pointed out that 16 Egyptian companies engaged in the launch of gas sub-networks and the delivery of gas to consumers, obtained licenses to distribute gas in the domestic market.

The activities to be licensed are those related to the operation of gas networks and facilities as well as commercial activities such as gas shipment and supply. The first phase includes licensing activities of the gas transportation system operator, the license of the gas distribution system operator, the license of the gas transporter, and the gas supplier license.

Furthermore, the source said that the regulator of the gas market activities has no income in adjusting gas prices for the final consumer and is committed to the pricing approved by the cabinet.

He explained that the Gas Market Regulatory Authority has assessed the licensing fees for the transportation, shipping, distribution and supply of natural gas, in accordance with the executive regulations of the Gas Market Regulation Law of August 2017.

The license for each activity shall be issued after verifying the applicant’s technical and financial suitability in accordance with the requirements determined by the regulatory authority and the rights and obligations of the licensee.

The source added that the license is the legal document issued by the regulator of the activities of the gas market, according to which entity can exercise any of the activities of the gas market subject to regulatory procedures in the gas market inside Egypt.

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Government completes renewable energy direct sale regulations in September https://www.dailynewsegypt.com/2019/05/08/government-completes-renewable-energy-direct-sale-regulations-in-september/ Wed, 08 May 2019 17:11:33 +0000 https://www.dailynewsegypt.com/?p=697555 Arab, international companies awaiting approval to build projects worth $3bn

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The government will finalise regulations for the production and sale of electricity produced from new private and renewable power plants directly to consumers by September.

Government sources told Daily News Egypt that the ministry of electricity set up a committee to prepare standards, regulations, and rules governing the production of electricity from solar and wind stations and selling them to consumers through the independent power producer (IPP) scheme with payment of electricity network usage fees. Consumers shall have free access to electricity from any licensed company producing and selling energy.

The sources added that the committee consists of officials from the Egyptian Electricity Transmission Company, the Egyptian Electricity Holding Company, the Electricity Regulatory Authority(ERA), the New and Renewable Energy Authority, and experts in the field of electricity and energy, including Mohammad Salah Sobky and representatives from the private sector, such as Ahmed Zahran, CEO of KarmSolar.

The most prominent features of the rules that are currently being defined include the non-monopoly of any company for the production and selling activity, and that prices be negotiated between the executing companies and customers, to set the maximum and lowest tariffs which could go up and down, the sources pointed out.

Also according to the sources, the rules additionally include obtaining licenses to engage in the production and sale of electricity by the ERA. The licenses are limited in duration, the activities implemented, and the licenses obtained by the private sector annually.

According to the Electricity Law, each participant has the freedom to choose their own electricity supplier.

The competitive market for electricity is based on free competition and the qualified participant has the right to contract with the production companies or distributors approved through bilateral contracts to provide their electricity needs.

The laws open the market to the private sector. In addition, the sector will become more competitive as more companies enter the industry.

These measures are in the interest of subscribers because the consumer will have the freedom to choose the service, and private sector companies will compete to provide better and cheaper services, the sources said.

The investments of the projects submitted by private companies to the ministry of electricity for the launch of solar and wind stations and the sale of electricity produced directly to the factories and institutions reached about $3bn and are expected to be approved following the completion of the rules and regulations governing the projects.

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Electricity Ministry negotiates with Eni to launch 200MW solar plant https://www.dailynewsegypt.com/2019/05/06/electricity-ministry-negotiates-with-eni-to-launch-200mw-solar-plant/ Mon, 06 May 2019 14:47:44 +0000 https://www.dailynewsegypt.com/?p=697338 Sealing deal depends on reaching agreement to purchase produced energy for 2.7 cents per KW/h

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Egyptian cabinet gave the ministry of electricity the green light to negotiate with Italian Eni over the first phase of a huge solar energy project it plans to implement in Egypt.

Sources at the Egyptian Electricity Transmission Company (EETC) told Daily News Egypt that the cabinet has approved implementing a solar energy plant with a capacity of 200MW by Italian Eni, given that the price of the energy produced from the project would be worth the same value received by the EETC to transmit electricity in the Kom Ombo bid for 2.7 cents per kW/h.

The sources added that the officials from the ministry of electricity have notified the Italian company of the cabinet’s decision and invited them to negotiate on the sale price of kW/h. It is scheduled to hold discussions on the implementation of the first phase of solar energy projects by mid-year. “We are waiting to negotiate the value of selling energy to seal the contract,” the source added.

Furthermore, the sources pointed out that the value of purchasing a kW/h for 2.7 cents is the maximum price the Egyptian company would pay to buy solar energy from the private sector. This value may decrease in the competitive bids planned to be launched in the future, known as “auctions”.

The Italian government has signed a memorandum of understanding (MoU) with Italian Eni to implement new and renewable power plants in Egypt with capacity of 1,000MW. Since mid-last year, the Italian company has started negotiations with the ministry of electricity to implement the projects in phases. Eni has carried out intensive negotiations at the end of December to begin implementing the plants.

The company has also demanded from the Egyptian Electric Utility and Consumer Protection Regulatory Agency (EgyptERA) a license to generate electricity from solar energy. The company started addressing companies working in the field of contracting solar energy projects in order to submit technical and financial offers. The companies have not been selected yet.

The ministry of electricity planned to sign contracts for electricity production projects from new and renewable energy plants with the private sector in order to achieve its strategy which mainly seeks to rely on new and renewable energy to produce 20% of the total capacities on the electricity grid until 2022.

The ministry has put forward various contractual mechanisms and systems to implement the projects, including tenders, independent producer systems, the feed-in tariff, net measurements, and decreasing bids. Many Arab and international companies are currently negotiating to implement solar and wind energy stations with capacities ranging from 50 to 100MW in each single project.

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Egypt’s gas consumption to increase to 7.3bn scf/day next year https://www.dailynewsegypt.com/2019/05/06/egypts-gas-consumption-to-increase-to-7-3bn-scf-day-next-year/ Mon, 06 May 2019 14:47:39 +0000 https://www.dailynewsegypt.com/?p=697329 Energy needs of growing markets met by connecting wells of Zohr, North Alexandria, says source

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The Egyptian Natural Gas Holding Company (EGAS) estimates the local market’s consumption of gas to increase to about 7.3bn cubic feet per day (scf/day) in the next fiscal year (FY) 2020/21, according to the industrial development plan, alongside with an increase in electric energy products and transforming the largest number of cars to operate with gas instead of petroleum products.

A source at EGAS told Daily News Egypt that the needs of growing markets will be met through connecting the wells of Zohr and North Alexandria to the national grid according to the timetable of the new plan to develop explorations.

The source added that the local consumption rates will reach maximum 6.5bn scf/day during this FY.

The source pointed out that the average consumption of gas will increase to 9bn scf/day by FY 2020/21, according to the state’s development plan.

Furthermore, the source pointed out that the average consumption of natural gas in the domestic market is growing annually, according to the industrial and construction development plan, with an increase in the number of cars running with natural gas.

Electricity consumption represents 61% of the total natural gas consumption, while the rest of the gas consuming sectors (industry, households, car supply, petroleum and its derivatives) represent 39%.

The ministry of petroleum’s plan aims to complete the implementation of the fields of Zohr, North Alexandria, and Borollos in order to contribute to increasing domestic production and to cover consumption rates, especially with the operation of the liquefaction plants through the gas pumped from Cyprus and Israel.

The increase in Egypt’s natural gas production has contributed to achieving domestic self-sufficiency, with the operation of the Edco liquefaction factory and the Jordan gas line, while retaining the gasification ship in Sumid port, the source pointed out.

He said that the second gasification ship will be utilised in case there is a need to import or convert gas through modern technology for a liquefied ship to export gas instead of importing it, transforming Egypt into a global market for energy and utilising the infrastructure owned by Egypt.

This plant will return imported liquefied gas to its gaseous state, with a maximum of 750m scf/day, in preparation for pumping it into the national gas grid and local consumption.

The source added that the petroleum sector has achieved several petroleum explorations over the past period, successively connected to the production. The total production is estimated to be 6.8bn scf/day now, compared to 7bn scf/day in March.

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Fees for land lease fixed at 2% of annual production: Fouda https://www.dailynewsegypt.com/2019/05/06/fees-for-land-lease-fixed-at-2-of-annual-production-fouda/ Mon, 06 May 2019 08:00:18 +0000 https://www.dailynewsegypt.com/?p=697208 We call on companies to invest in renewable energy, transform Sharm El-Sheikh into green city

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Daily News Egypt met Khaled Fouda, governor of South Sinai, who said that the project faced many challenges in the beginning, both in licensing and land from all competent authorities. It was agreed to give the company the land to launch the solar power plant in exchange for 2% of the value of energy produced annually.

He added that the decision will apply the same value to any investor who wants to set up a solar power plant in South Sinai, where he will receive land at a rate of 2% per annum. “All the cities in South Sinai are solar-ready and we call on companies to invest here and turn Sharm El-Sheikh into a green city,” Fouda stated.

Furthermore, he said the plant operates at a capacity of 5MW feeds the national electricity network and helps provide electricity for more than 2,000 residential units, with carbon emissions cuts of up to 5,000 tonnes a year. This will boost the country’s strategy to develop renewable energy solutions to reach 20% of total energy used by 2022.

The station is the first phase of the project of a full integrated solar power plant with a capacity of 40MW he stressed. Schneider Electric and its partners will start implementing the second phase with a capacity of 35MW in the coming months.

Fouda pointed out that Schneider Electric contributed to the lighting of the village of Abu Gharaq in Abu Zenima with solar energy at a cost of EGP 5m, within the framework of its corporate social responsibility and its keenness to support the state in its development plan.

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Negotiations with hotels in Sharm El-Sheikh to sell electricity produced in second phase https://www.dailynewsegypt.com/2019/05/06/negotiations-with-hotels-in-sharm-el-sheikh-to-sell-electricity-produced-in-second-phase/ Mon, 06 May 2019 07:30:20 +0000 https://www.dailynewsegypt.com/?p=697245 Tawakol: 80GW/h expected to be contracted with tourism sector

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Hany Tawakol, chairperson of Al Tawakol Electrical Company (Gila), said the company is currently focusing on completing the second stage of the 35MW solar power plant. The land will be agreed upon with the governor of South Sinai within months.

He explained that the second phase of the project will be implemented by the independent product system (IPP), which includes the production of electricity and selling to consumers with payment of fees for the use of electricity network. Moreover, the company is negotiating with a number of hotels in Sharm El-Sheikh to provide their electricity needs through the solar power plant to be launched with a capacity of 35MW.

“Production capacity is expected to reach 80GW/h to be sold to the tourism sector,” Tawakol said.

The coming period is witnessing the acceleration of implementation rates in all projects in Sinai, as well as the launch of a package of new projects, which represents a new stage in the development of turquoise land.

The company works within Egypt’s strategy and vision for the use of clean energy and seeks to expand its portfolio of local and regional projects in Africa and the Middle East to achieve sustainable development.

Moreover, he added that the company has completed the implementation of solar power plants in Benban, Aswan, within the second phase of the feed-in tariff with a capacity of 145MW, and has formed partnerships with investors and contributed to bring funding for projects from foreign banks.

Tawakol maintained that the legislation and regulatory controls set by the government for the renewable energy sector have helped attract Arab and international companies to invest in electricity production projects from solar and wind stations. The demand for investment in projects is expected to increase during the coming period.

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Daily News Egypt visits first solar power plant within Sinai development programme https://www.dailynewsegypt.com/2019/05/06/daily-news-egypt-visits-first-solar-power-plant-within-sinai-development-programme/ Mon, 06 May 2019 07:00:47 +0000 https://www.dailynewsegypt.com/?p=697241 Schneider Electric completed implementation of plant’s first phase

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Egypt is currently working on implementing an integrated programme for the development of Sinai. The programme is given priority by the political leadership and the government, and supported by Arab funds and international financial institutions for Sinai’s regional strategic importance.

Schneider Electric completed the implementation of the first phase of South Sinai’s solar power plant with a capacity of 5MW at a cost of $5m in the feed-in tariff mechanism, in cooperation with Al Tawakol Electrical Company (Gila) and Petro Energy. The company aims to continue the second phase and increase capacity by 35MW to reach 40MW in the coming period.

Daily News Egypt conducted a tour of the 85,000 square metre solar power plant in the Safari land in Sharm El-Sheikh, which is the first plant in the national programme to develop Sinai and turn the city of Sharm El-Sheikh into an eco-friendly city.

“The project is part of the first stage of the feed-in tariff, which includes the production and sale of energy to the Egyptian Electricity Transmission Company. Schneider Electric signed a memorandum of understanding (MoU) with South Sinai to set up a 40MW solar power plant,” said Sherif Abdel Fattah, vice chairperson of Schneider Electric. The MoU was signed in the presence of Presidents Abdel Fattah El Sisi and Francois Hollande during his visit to Egypt in 2016.

Abdel Fattah explained that the terms of the agreement include the selection of a second party for the implementation of contracting work, especially as the company’s role is in the supply of products, and it must contract with a company accredited by the New and Renewable Energy Authority, hence the contract will be with both companies.

The negotiations for the land took a long time, he said. However, after the intervention of Khaled Fouda, governor of South Sinai, the land was allocated in return for 2% of the annual production. The company is working to boost capacity to 40MW.

The establishment of the solar power station in Sharm El-Sheikh lasted 77 days, with 15,300 panels installed of 325MW per panel. The project produces 9,9GW/h annually and contributes to the reduction of carbon emissions by 5,000 tonnes per year.

Walid Sheta, chairperson of Schneider Electric Egypt, said that his company is committed to supporting Egypt’s renewable energy production strategy until 2022 based on the recommendations of the Paris Climate Agreement. Egypt for Schneider Electric is number one in Africa because of the tougher conditions in other countries. It is considered the equilibrium of the region and the most important country and represents the largest market and industrial base.

Sheta added that the measures taken by the state to attract investment have helped investors to develop their confidence in the Egyptian economy and the management of Schneider Electric. The company has undertaken a number of commitments to expand the plant in Egypt, where 30% of the production is exported to the Arab Mashreq and Africa.

Mohamed Mamdouh Abbas, board member of Intro Solar, said that the 5MW solar power station in Sharm El-Sheikh is the first step toward building a huge and integrated system in the new and renewable energy sector and transforming Sharm El-Sheikh into a green city.

Abbas explained that the company is seeking to expand its local and regional portfolio to participate in the implementation of projects to produce electricity from renewable sources, as the focus of Intro Energy is not only aimed at the diversification of projects and expansion in the services and utilities, but rather to contribute to the strengthening and diversification of the electrical grid.

During the tour, Daily News Egypt met with Yahia Abdel Rahim, director of the project of the solar station in Sharm El-Sheikh at Madkour Engineering Projects Company, the project’s general contractor. He explained that the company is responsible for installing the equipment and implementation of the project and civil works on the site.

Abdel Rahim elaborated that the biggest challenges to the implementation of the solar power plant with a capacity of 5MW is the location of the land and the required time, where it was bringing many raw materials from Cairo or outside Sinai which was supposed to take three months, but it was established in less than two and a half months.

“The land allocated for the project is rocky and part of it is fossilised sand. The consultant in charge of the project asked for land paving but this procedure would have taken six months,” he said, adding that the company maintained quality.

Furthermore, he revealed the installation of 26 surveillance cameras inside and outside the project to cover the ground areas and the main gate, in order to monitor the station around the clock and avoid any problems which may occur.

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Egypt’s energy reforms paves way to private sector, attracts $2bn investments: Malpass https://www.dailynewsegypt.com/2019/05/05/egypts-energy-reforms-paves-way-to-private-sector-attracts-2bn-investments-malpass/ Sun, 05 May 2019 19:47:08 +0000 https://www.dailynewsegypt.com/?p=697230 Benban’s success can be replicated in transport, water, sanitation sectors, says WBG president

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The Benban solar development complex is built on an area of 14.4 square miles, which was dedicated to the state-run New and Renewable Energy Authority (NREA) in accordance with presidential decree No 274 for year 2014. The NREA divided the site into 41 separate plots and made them available to developers and companies to carry out individual projects. The investment is worth EGP 40bn.

The project is expected to be one of the largest solar generation facilities in the world and would make a dramatic turnaround in the field of renewable energy in Egypt.

The Benban project consists of 41 solar power plants with a total capacity of 1.8GW.  The project began in 2015 and was completed by 2018.

The project includes four major power transmission stations with a total capacity of 2,000MW, in addition to 40 solar substations that will produce 50MW from each, with a total voltage of 500kV and 220kV per station. The four main stations are scheduled to be completed by the end of August.

Moreover, Malpass, Waly, and Nasr held meetings with beneficiaries of the Takaful and Karama social safety net programme. The programme which presently reaches over 2 million of the country’s most vulnerable households

Wali pointed out that the Takaful and Karama social safety net programme has been a great success, explaining that since the start of the programme in March 2015 more than EGP 31bn were disbursed.

Malpass arrived in Cairo on Saturday for a two-day working trip focused on the Egyptian economy. During his visit, the WBG president met with Egypt’s President Abdel Fattah Al-Sisi, Minister of Investment and International Cooperation, Sahar Nasr, government officials, and parliamentarians to discuss the progress of the Egyptian reform programme and how the WBG can best contribute to this process.

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Egypt to renew oil hedging to shield against oil prices fluctuations: Minister of Petroleum https://www.dailynewsegypt.com/2019/05/04/egypt-to-renew-oil-hedging-to-shield-against-oil-prices-fluctuations-minister-of-petroleum/ Sat, 04 May 2019 18:32:39 +0000 https://www.dailynewsegypt.com/?p=697120 Renewal is essential to secure subsidy allocations from price changes, says El-Molla

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The government plans to renew the agreement on the implementation of the oil hedging against the high prices of crude oil during the next fiscal year (FY), to protect the budget of FY 2019/20 from the financial risks resulting from the fluctuation of global oil prices.

The Minister of Petroleum and Mineral Resources, Tarek El-Molla, told Daily News Egypt that the oil hedging mechanism has been applied in the current FY, to cover any rise in prices above $70 per barrel.

These oil hedging services would allow the government to buy crude oil over a long period of time at a fixed price in order to avoid the uncertainty in the international market.


He added that the agreement will end on June 30 and that it aims to renew it in order to secure the fuel subsidy budget in FY 2019/20 from the risks of oil price fluctuations in the markets.


The draft FY 2019/20 budget indicated that the implementation of the hedging mechanism aims to protect the current FY from the financial risks resulting from fluctuating world oil prices, and to reduce any negative effects on the subsidy bill.

 

The latest global estimates suggest global oil prices will stabilise in 2019 at levels ranging from $65 to $70 a barrel, based on oil purchase contracts and International Monetary Fund forecasts, Egypt’s Finance Ministry said in a statement.

The draft state budget for the state FY 2019/20, significantly reduced subsidies for petroleum and electricity.

The reduction of subsidies for petroleum products in the new budget project amounted to EGP 36.112bn. The government allocated EGP 52.963bn, compared with EGP 89.075bn in the current FY 2018/19.

The new draft budget sets the price of Brent crude at $68 per barrel, up from $67 per barrel in the current FY. In the 2017/18 budget, the price of an oil barrel globally was set at $55.

Egypt is highly vulnerable to crude oil price fluctuations, as each $1 increase in the Brent crude’s price would cost the state EGP 4bn, according to the finance ministry.

Last year, the government contracted with investment banks JP Morgan and Citibank to hedge against the risks of rising global oil prices.

The OPEC Secretary General, Mohammad Barkindo, assured in February, that the barrel’s price will not exceed $70, until the next meeting of the OPEC members in April in order to discuss extending the production cut during 2019.

However, the prices of oil in global markets jumped to $73.60 per barrel last week, driven by the US decision to revoke sanction waivers on Iranian oil, and renewal of sanctions onVenezuela, which would cause a reduction in their oil exports.

 

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Oriental Weavers to deliver first phase of OIC before year-end https://www.dailynewsegypt.com/2019/04/24/oriental-weavers-to-deliver-first-phase-of-oic-before-year-end/ Wed, 24 Apr 2019 17:06:17 +0000 https://www.dailynewsegypt.com/?p=696739 Egypt’s Oriental Weavers Group revealed new details about its planned industrial city, Orientals Industrial City (OIC), in Ain Sokhna, announcing that the project will be built on an area of 10.5m sqm at a cost of EGP 13bn. The new industrial city would be developed and managed by the company’s subsidiary Orientals for Industrial Development …

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Egypt’s Oriental Weavers Group revealed new details about its planned industrial city, Orientals Industrial City (OIC), in Ain Sokhna, announcing that the project will be built on an area of 10.5m sqm at a cost of EGP 13bn.

The new industrial city would be developed and managed by the company’s subsidiary Orientals for Industrial Development and would cater to both small and medium enterprises and heavy industries.

Mohamed Farid Khamis, the managing owner of Orientals for Urban Development (OUD), a subsidiary of Oriental Weavers Group, said that the company aims to deliver the first phase of the OIC after completing the utilities before the end of the year, adding that it is planned to attract about 18 industries as a start of the city.

Khamis noted that the OIC is an integrated industrial city that includes plants with spaces ranging between 600-500,000 sqm. In addition, the city would include a 4-star hotel and administrative and residential units.

He added that the project is being developed over five phases within six years, revealing that the group is negotiating with four banks to provide 50% of the project’s funding, expecting to reach the funding agreement within two months.

While the Orientals for Industrial Development will be responsible for developing the project’s infrastructure. The OUD will handle the marketing, designing, and implementing the residential and administrative areas of the project.

Khamis expected achieving EGP 1bn in sales of the project’s first phase, adding that the official launch of the project will be in May. The areas of the five phases come as follow: 1.6m sqm in the first phase, 950,000 sqm in the second phase, 1.4m sqm in the third phase, 1.8m sqm in the fourth phase, and 1.3m sqm in the fifth phase.

“The project provides the clients with 50% tax exemption over a period of seven years and only 2% of the customs tax on equipment and machinery, as well as, the customers will have the right to establish customs outlets. Moreover, the group will provide partial support for technical training,” he explained.

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NTPC to invest in solar energy in Egypt https://www.dailynewsegypt.com/2019/04/24/ntpc-to-invest-in-solar-energy-in-egypt/ Wed, 24 Apr 2019 16:54:45 +0000 https://www.dailynewsegypt.com/?p=696707 Egyptian market stable, attractive for investment, says NTPC’s GM

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The National Thermal Power Corporation (NTPC) General Manager, Ananda Kumar Gupta, said that he held a meeting with the Head of the New and Renewable Energy Authority (NREA), Mohamed El-Khayat, to discuss the implementation of solar energy projects in Egypt and to fund long-term investments either through cooperating with the Egyptian government or through competitive bidding.

He said that the company is ready to implement projects in Egypt with considerable capabilities and investments according to various contractual systems, and seeks to exchange experiences and train workers on energy projects from various sources.

Furthermore, Gupta added that the Egyptian market is stable and attractive for investment, especially in view of the available legislation and regulations governing project implementation.

The NPTC signed a memorandum of cooperation with the Egyptian Company for Mechanical and Electrical Projects (Kahromika) on Saturday to carry out maintenance works for power stations in Egypt, the Middle East, and Africa.

The cooperation with the Indian company provides maintenance services for power plants and the upgrading of old stations with a future programme to transfer technology and expertise in order to replace and manufacture the parts used during the maintenance, replacement, and renewal operations, according to Kahromika’s Chairperson, Sherif El-Sheikh.

In response to a question by Daily News Egypt, El-Sheikh said that Kahromika and the NTPC are aiming to maintain all electrical capabilities, and will hold a meeting with the electricity ministry to discuss the capacity to be maintained. The target is to carry out the maintenance operations by an Egyptian company in the future, as well as to send units or parts which are technically flawed overseas for repair in workshops, factories, and specialised companies.

He added that Kahromika aims to enter the Jordanian and Omani markets during the coming period.

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AOI will complete launch of two solar plants in Eritrea next October https://www.dailynewsegypt.com/2019/04/24/aoi-will-complete-launch-of-two-solar-plants-in-eritrea-next-october/ Wed, 24 Apr 2019 16:50:14 +0000 https://www.dailynewsegypt.com/?p=696706 Organisation with ELMACO, EGMAC to supply electrical equipment to both projects

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The Arab Organization for Industrialization (AOI) will complete the launch of the 4MW solar power plants in Eritrea by next October.

An official at the AOI told Daily News Egypt that the organisation will establish two stations with a capacity of 1 and 3MW in Eritrea, and according to the directives of the political leadership, the implementation of the two projects will occur during the current year.

He added that the AOI sent the solar cells to Eritrea, and initially agreed with El Nasr Company for Transformers and Electrical Products (ELMACO) and EGMAC to supply some of the electrical equipment for the two solar plants to be inaugurated, and is currently negotiating with Egyptian companies to carry out the drilling and installation of piles.

He referred to the keenness of the organisation to exchange experiences and train technical workers in the state of Eritrea on the ongoing maintenance and follow-up of the solar power plant.

Furthermore, he emphasised that this contract contributes toward strengthening the cooperation between the Nile basin countries and the rest of Africa, especially under Egypt’s chairpersonship of the African Union and the formation of an Egyptian alliance of the AOI and several national companies to work on transferring the Egyptian development experience to all parts of the continent.

The cells supplied to the project for the launch of two solar power stations in Eritrea, which are integrated into the AIS cell production line, and their efficiency and specifications, are in line with international quality standards, the official said.

Moreover, he said that the AOI puts all its capabilities, technical, and technological expertise to serve the African continent and support renewable energy projects, through the Egyptian initiative for developing the Nile basin countries.

The AOI has designed and implemented over 100 solar power stations since 2013 with different capacities throughout the republic. It contributed toward national projects such as lighting roads and installations using solar energy in new governorates and cities, as well with the ministry of foreign affairs in setting up solar stations abroad to support the Nile basin countries.

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Upper Egypt pipelines receive 7.5m tonnes of fuel annually: PPC https://www.dailynewsegypt.com/2019/04/24/upper-egypt-pipelines-receive-7-5m-tonnes-of-fuel-annually-ppc/ Wed, 24 Apr 2019 15:19:00 +0000 https://www.dailynewsegypt.com/?p=696622 Upper Egypt receives about 7.5m tonnes of crude oil, butane, and petroleum products through pipelines annually, the Chairperson of Petroleum Pipeline Company (PPC), Abdel- Moneim Hafez, said He pointed out that investments worth EGP 3.6bn were injected into Upper Egypt, including a project to increase the capacity of butane to Lower Egypt governorates from a …

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Upper Egypt receives about 7.5m tonnes of crude oil, butane, and petroleum products through pipelines annually, the Chairperson of Petroleum Pipeline Company (PPC), Abdel- Moneim Hafez, said

He pointed out that investments worth EGP 3.6bn were injected into Upper Egypt, including a project to increase the capacity of butane to Lower Egypt governorates from a daily 2,600 tonnes to 6,000, as implementing the butane line of Ras Ghareb-Assiut was completed, of a distance of 305km, in addition to a butane line from Assiut to Sohag along 127km.

The facilities to receive and pump butane from SUMED in Ain Sukhna to the national butane network to secure and increase the rates of pumping gas to Assiut, Sohag, and Upper Egypt were connected.

Hafez added that doubling the Ras Bakr-Ras Gharib-Assiut lines was finished, along a distance of 160km. The facilities to receive and pump butane from Sonker to the national butane network was also completed.

He explained that it is planned to implement the doubling of the line of Ras Ghareb-​​Khashm Al Raqaba of a distance of 130km, in addition to completing the pipeline to transport petroleum products from El Tebbeen to Assiut with a length of 376km at a rate of 3,000 tonnes per day to meet the needs of governorates in Lower Egypt.

He added that construction of the pipeline from South Helwan to Bani Haroun of a distance of 36km is resumed in order to meet the growing needs of northern Upper Egypt for diesel and petroleum products.

Additionally, the pipeline of Sokhna-Tebeen is under construction of a distance of 115 km, to connect the Upper Egypt lines to the Ain Sokhna area. Doubling the Minya-Assiut line is also underway, along a distance of 115km to increase the rates of transporting petroleum products to Minya and Assiut to a daily 8,000 tonnes.

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