Egypt to allow factory energy imports from 2015

Egypt will allow new factories to import gas and coal starting from 2015, a minister said on Tuesday, saying expansion in industrial projects should continue, even if local energy supplies did not meet domestic needs.

Egypt had said it would offer new licences for 12 cement production lines as it aims to boost cement output by 40 percent by 2015 to meet growing construction needs and said the firms may import their own energy supplies to produce power.

Egypt has sought to tackle power outages, blamed mainly on local gas shortages, that economists say could cramp investment and which prompted public grumbling during a hot summer and the Muslim fasting month of Ramadan.

“Energy imports will begin in 2015,” Trade and Industry Minister Rachid Mohamed Rachid told al-Mal newspaper.”There is a general rule already approved allowing energy imports for new factories, which will go operational by 2015.”

“We hope to increase energy quantities, but at the same time we hope that the industry will move beyond this barrier,” he said. “There should be no link between the local growth in the produced energy and industrial expansion.”

“We are quite optimistic about national energy discoveries and potential quantities.”
The minister said the new import measures would apply to all industries and not just cement factories.

“We are talking about a different picture in seven to eight years, a situation that will make companies vie for supplying energy even for a single factory. There will be no waiting list to get energy,” Rachid said.

He said the government was working on plans to liberalise energy prices by the financial year 2016/17, saying it had anticipated that it would need imports to meet the growing needs of industry by then.

The government has been gradually phasing out energy subsidies to industry.

(Source: Reuters)


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