Egypt signs $40bn worth power sector investments at Economic Conference

Egypt economic conference image by Reutures

At the second day of Egypt’s Economic Development Conference, the country signed several deals and MOUs worth over $158 billion with various international companies.

The deals focusing in the field of energy segment has so far reached over $40 billion worth of investment.

Egypt announced major investments in the fields of power generation as well as the oil and gas sectors.

British Petroleum made the single largest foreign investment deal ever, committing a $12 billion over four years to develop gas resources and condensates in the West Nile Delta.

Production from the project will start from 2017, reaching 25 percent of Egypt’s current gas production.

In another initiative, Italian oil company Eni signed agreements worth $5 billion in several gas discoveries over 4-5 years.

Another British energy company BG plans to sign a $4 billion agreement with Egypt to develop natural gas fields in the Mediterranean over two years.

Besides, a $350 million gas deal was announced by the Dana Gas involving the drilling of 40 new development wells, work overs on existing wells, building new pipelines and de-bottlenecking an existing plant over the next 30 months.

The total value of this future gas project is estimated as $21.5 billion.

Siemens International signed four MOUs worth over $10 billion with Egypt to construct several power plants with a total production capacity of 6.6 GW.

The deal consists of $4.6 billion for a 4.4 GW power plant, a 2 GW of wind power project in addition to a new wind rotor blade factory.

ACWA Power and Masdar will also invest $2.4 billion to construct solar plants and a wind energy project. The total production capacity will be up to 4,400 MW.

ACWA will invest another $7 billion for the construction of a coal power plant.

Egypt suffers from frequent power cuts, limiting the production capacity of energy dependant industries such as fertilisers and cement.

The government has fixed feed-in tariffs for renewable energy and issued a new electricity law that liberalises electricity production and transmission, and allowing private investors in some sectors like cement production to shift to coal for power.

In addition, Egypt plans to establish an independent regulator for the oil and gas sector in near future.

The country needs to boost up its energy portfolio in order to support the overall infrastructure development and sustainable growth in future.

Sabeena Wahid
[email protected]