A General Authority for Petroleum senior official revealed in a statement to Daily News Egypt that the debt of the Ministry of Petroleum to the Ministry of Finance has climbed to reach EGP 100bn. The main reason for that was the Ministry’s effort to pay cumulating arrears to foreign partners.
Foreign partners have been reducing their production rate of gas and oil as a response to delayed payment, a reality that further aggravated the energy crisis in Egypt. The official added that the agreements include an interest added on dues. They will obligate partners to inject the required investments in order to carry out development and exploration processes in various fields.
The official estimated the investments of foreign partners during fiscal year (FY) 2015/2016 at $6bn, compared to nearly $7.5bn during FY 2014/2015.
He explained that foreign partners in the petroleum sector are dealing with the government’s lack of commitment to promises of paying part of the dues on time. The foreign partners have responded by delaying the connection of timely natural gas production, with the company’s plan which was agreed upon with the petroleum ministry.