Plunging gas prices are forcing Egypt to change its gas-selling strategy: Egypt will reduce the amount of liquefied natural gas (LNG) it sells via short-term contracts and negotiate long-term agreements in response to plunging gas prices, Bloomberg quoted Oil Minister Tarek El Molla as saying. The government is currently in talks with international customers to sell gas at USD 5 per mn British thermal units under renewable 12-18-month contracts, El Molla said in an interview yesterday during the World Economic Forum in Davos.

Spot contracts to fall this year: Egypt offered 80 spot LNG tenders last year and this is set to fall further this year. “They’re not giving us the value that we want,” El Molla said. “We canceled several LNG tenders last year because the prices that we received don’t even match the cost of production … This year will be even more challenging if we continue seeing the drop in prices.”

Global gas prices hit 45-month low: Gas prices plunged 5.4% yesterday to hit lows not seen since March 2016.

Damietta LNG plant could restart within weeks: El Molla said that the Damietta LNG facility will reopen “in the coming few weeks” ending a six-year hiatus. This could enable Egypt to double its gas exports from 1 bcf/d currently by the end of the year. The plant will output 500 mncf/day then gradually increase to 700 mncf/day, he said. The Damietta plant has been the subject of a long-running legal dispute between the government and plant operator Union Fenosa Gas. The plant was thought to be on the cusp of opening several times last year but the failure to reach a settlement in the dispute resulted in delays.

EGAS cuts Zohr production by 600 mcf/d: The Egyptian Natural Gas Holding Company (EGAS) has cut gas production from the Zohr field by 600 mcf/d to 2.4 bcf/d, the local press quoted unnamed sources as saying. The sources claimed the decision was motivated by a decline in local consumption and high pipeline pressure.