Minister of Petroleum and Mineral Resources Tarek El-Molla said that the state budget bears 35% of the cost of fuel provided in the local market, with plans to liberalise gasoline prices in the local market.
He explained that the bill of subsidising fuel in the first quarter of this fiscal year amounted to EGP 23.5bn, while allocations were EGP 27.5bn.The remaining EGP 4bn was saved due to the price of Brent oil falling below expectations.
El-Molla noted that Egypt is in negotiations with Iraq to increase the quantities of crude oil supplied to Egypt to about 2 million barrels per month, up from 1 million now.
Moreover, he told Daily News Egypt that the bylaws for gas regulation will be issued in two weeks, where the ministry completed reviewing the regulations and sent its recommendation to the cabinet to officially pass the bylaws.
He explained that the ministry sent a list of nominations for members of the gas facility to Prime Minister Sherif Ismail.
The Board of Directors of the Gas Regulation Facility will be chaired by the Minister of Petroleum and Mineral Resources. Its members include the Chief Executive Officer, whom will be selected among experts of the petroleum sector, along with three members representing entities engaged in the activities of the gas market from the petroleum sector, and the head of the Egyptian Competition Authority.
It also includes two independent members with expertise in the technical, economic, legal, or civil society sectors from non-gas markets, as well as the president of the Federation of Egyptian Industries or its nominee.
The minister pointed out that the new law includes multiple advantages, as it is a major step towards the reorganisation of the gas market in Egypt gradually.
It also works to attract private sector investments to enter the market of trade, storage, sale, supply, and distribution of natural gas directly to consumers using the facilities of the petroleum sector for a specific fee as required by law.
It also contributes to securing diversified sources of natural gas to start industrial projects, boost economic growth and value-added projects, create a competitive market for gas and quality of services, and continuously improve, as well as achieve return on investment for the first time in establishing and extending networks and providing and encouraging investments to develop and improve infrastructure and gas transport networks.
El-Molla added that the new law will lead to further encouraging and stimulating investments in the development and production of natural gas from the fields, especially that the law will allow gas producers to sell their shares directly in the local market, according to the rules and using facilities and networks belonging to the oil sector.