EGAS halts pumping of gas to Idku plant

The Egyptian Natural Gas Holding company (EGAS) has stopped pumping gas to the Idku liquefaction plant operated by British Gas and GDF Suez, as a result of the increased use of gas by power stations, according to a senior official at EGAS.

He added that since last year, the quantity of gas pumped from EGAS to the Ikdu liquefaction plant did not exceed 100m cubic feet per day, as a result of the ongoing decrease in natural gas production in Egypt.

By contract, the Idku liquefaction plant should be pumped 1.13bn cubic feet of gas per day, but the rates have been decreasing gradually in the past month, reaching only 4m cubic feet on 20 Augustwhich led to a halt in the factory’s work, according to the official.

He added that he is afraid that the Idku liquefaction plant will be subject to international lawsuits and arbitration like its counterpart, Damietta LNG, particularly in light of the government’s refusal to allow companies to import gas from Israel to re-initiate work at factories.

The Egyptian government has failed to negotiate with SEGAS and Union Fenosa on the Damietta LNG plant and was unable to persuade them to waive arbitration, which would require $6bn in compensation. As a result, these partners will not provide gas to Egypt until 2018. The contracted quantities in question stand at about 750m cubic feet of gas per day, according to the EGAS official.