Jordan will sign an agreement with Egypt next month to resume natural gas supplies, the Associated Press reported, quoting Minister of Energy and Mineral Resources Khaled Toukan.

Toukan said several attacks this year on Egypt’s pipeline delivering the fuel may prompt the Kingdom to look for alternatives, but Jordan will now try to use Egyptian gas to meet its energy needs.

The minister said Sunday the agreement stipulates higher costs, but declined to say how much, according to AP.

Under a previous deal, Amman received natural gas at less than half of the market price.

Supplies of Egyptian natural gas to the Kingdom have been disrupted several times this year due to five explosions that sabotaged the Arab Gas Pipeline, which provides Egyptian gas to Jordan and Israel.

The disruptions have forced the Kingdom’s power plants to use their heavy oil and diesel reserves, costing Jordan some $3 million per day.

The unreliability of Egyptian gas has forced Jordanian authorities to look for alternative energy sources including liquefied gas and increased heavy oil imports from Iraq.

Plans are in place to construct an offshore terminal for liquefied gas at the Port of Aqaba by 2013.

Cairo has come under increasing popular pressure since the January 25 uprising to end gas exports to Jordan and Israel and prioritise the resource for domestic use.

The Kingdom, which currently buys 97 per cent of its energy needs, used to import about 240 million cubic feet of Egyptian gas a day, or 80 per cent of its electricity requirements.

In a related development, Jordan is expected to start importing a total of 1,000 tonnes of heavy fuel per day from Iraq as of next month for electricity power generation purposes, a government official said Sunday.

Ministry of Energy and Mineral Resources Secretary General Farouq Hiyari told The Jordan Times over the phone yesterday that the ministry has referred a tender to a local company to bring 1,000 tonnes of heavy fuel oil on a daily basis from Kirkuk in the north of Iraq to Aqaba.

Within the coming two days or after the Eid Al Fitr holiday all documents to start transporting the heavy fuel will be ready, the official said.

He stated that the fuel will supply the Aqaba Thermal Power Station, approximately 22 kilometres south of the southern portal city.

Hiyari stopped short of giving more details on the shipments in terms of prices per tonne or whether the new shipments will also be provided at preferential prices.

Early June, Jordan and Iraq reached an agreement to increase the volume of petroleum imported to Jordan from Iraq to 15,000 barrels a day in lieu of 10,000 barrels, under preferential prices.

The agreement was reached during a visit by Prime Minister Marouf Bakhit to the neighbouring country.

The premier said then that Iraq would also provide Jordan with 30,000 tonnes of heavy fuel per month at discount prices.

According to reports, hydrocarbons imported from Iraq are $18 per barrel below the price on international markets.

Source: The Associated Press & The Jordan Times