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Egypt exempts industrial sector of EGP 5.3bn debts for natural gas consumption - Daily News Egypt

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Egypt exempts industrial sector of EGP 5.3bn debts for natural gas consumption

Ministry submits proposals in August 2019 to schedule debt arrears by ceramics companies, says El Molla


Natural gas industrial consumers will be exempted EGP 5.3bn of their debts owed to the ministry, according to Minister of Petroleum and Mineral Resources Tarek El Molla.

This will be done through a package of procedures applied to contractual clauses contained in natural gas supply contracts.

The mechanism of exemptions granted to private, public, and public enterprise sector customers will be sent to natural gas distribution companies next week, in preparation for activating the decision. The exemption procedures were prepared by the Ministry of Petroleum with the aim to increase development and boost production, and were approved by the cabinet early this month.

El Molla said, “If an industrial client consumed less natural gas than the contractual quantities, the client shall be fined with the excess value. The new decision exempts all industrial clients from this fine retroactively as of 2009.”

The minister added, “All industrial customers shall be exempted by 65% ​​of the penalty stipulated in contracts if a customer withdraws more natural gas than contractual quantities. All clients are also exempted from 50% of the due late payments penalties for gas supply, providing that they pay the debts owed according to the previously agreed scheduling programmes.”

Meanwhile, El Molla said that his ministry submitted in August 2019 a proposal to the cabinet on scheduling debt arrears owned by ceramics companies. Ceramics industry’s natural gas debt represents about 55% of the private sector’s gas debt. The ministry suggested that those companies shall schedule their debts of gas withdrawals from January to September 2019 over four years after making a 5% advance payment.

The proposal also includes decreasing the consuming insurance to 30 days of daily contractual quantities instead of 60 days, and to be paid in instalments over 24 months instead of 18 months, after paying 25% of the insurance value in advance.

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https://dailyfeed.dailynewsegypt.com/2020/06/18/egypt-exempts-industrial-sector-of-egp-5-3bn-debts-for-natural-gas-consumption/
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