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Tuesday, 25 August 2020

Egypt to reduce oil imports to 18.4 mn tonnes in current fiscal year -sources

A positive spin on covid: Egypt’s petroleum imports will fall 17.1% this fiscal year: Egypt will reduce its imports of oil and petroleum products in FY2020-21 to 18.4 mn tonnes, a 17.1% y-o-y drop from the 22.2 mn tonnes imported in FY2019-20. This should bring our fuel import costs down to USD 13.1 bn, from USD 16.1 bn last year, the local press reported, citing unnamed Oil Ministry sources. While it is very likely that covid-19 and the lockdown have significantly reduced our consumption of fuel, the sources stressed that it marks a steady trend in declining imports — Egypt had imported 28.4 mn tonnes in FY2018-2019 — as the country ramps up exploration and sets up new production fields on existing production lines in an effort to cover more of its domestic consumption.

And they wouldn’t be wrong: State-owned Egyptian General Petroleum Corporation (EGPC) signed nine oil and gas exploration and production agreements this year that will see companies including Shell, Apache, and Petronas invest at least USD 452 mn to drill 38 wells in concessions in the Mediterranean and Western Desert. The EGPC plans to drill 40 new exploration and development wells with investments of EGP 2.6 bn, and bring its total production to about 106 bbl/d in FY2020-2021, according to figures in the Oil Ministry’s planning budget.

Reducing our dependence on foreign oil will likely get a big shot in the arm from the government’s plan to have us all driving natgas cars. Take a deep dive into the plan with our three-part series in Hardhat: Part 1, part 2, and part 3.

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