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Wednesday, 9 August 2017

Natural gas market deregulation part of move to freer markets, adds more sources -Bloomberg

Approving the law deregulating the natural gas market “effectively relieves the government from the burden of providing for the rapidly growing natural-gas consumption and turns it into a regulator … It’s all part of the same direction of having freer markets in Egypt,” Pharos Holding head of research Radwa El Swaify told Bloomberg. President Abdel Fattah El Sisi approved the natural gas act on Monday. The new law “sets up a natural gas regulatory authority charged with licensing and devising a plan to open the gas market to competition. It also allows for the eventual import of natural gas by private companies.” Our friend Haitham Abdel Moneim, who runs IR for EK Holding, which owns distributor NatGas, believes the move will bring in greater transparency and flexibility to the market and says it would give “more options for sources of gas and maybe better prices.”

The new act is also good news for Israel: The deregulation of Egypt’s natural gas sector could mean that the country is “on its way to becoming a major market for Israeli natural gas exports,”notes Eran Azran in Haaretz. The act is expected to allow projects that had been stalled due to regulatory and legal binds, such as the Tamar and Leviathan field partners’ agreements with Egypt’s Dolphinus Holdings, to finally move forward, the article adds. Just don’t forget about the small matter of a USD 2 bn arbitration award against Egypt won by Israel Electricthat has effectively blocked plans to reverse the Arish-Ashkelon pipeline to allow us to import gas from the fields.

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