A source at the Egyptian Ministry of Petroleum and Mineral Resources stated to Egypt Oil&Gas that Saudi Aramco did not send January fuel cargos. Thus the 700,000 tons cargo of petroleum derivatives was halted for four consecutive months.
The source added that the Egyptian General Petroleum Corporation (EGPC) will launch a tender to buy 700,000 tons of benzene, diesel and mazut from imports and pay in foreign currency to compensate for the shipments that were received from Aramco and to cover citizens’ demands.
The commercial contract between EGPC and Aramco is still not cancelled as the contract does not have penal terms. According to the contract, Saudi Arabia was to provide Egypt with 700,000 tons per month of derivatives for five years. The $23b contract was signed by EGPC and Aramco in April 2016 to receive 400,000 tons of diesel, 200,000 tons of benzene, and 100,000 tons of fuel oil on a monthly basis. The contract allows Egypt over 15-year payment facilitations at 2% interest.