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Tuesday, 16 February 2021

Magic sauce for industry: Lower natgas costs + new legislation?

Manufacturers could get lower natural gas prices if the House Industry Committee gets its way, with the committee lobbying Oil Minister Tarek El Molla to cut prices to factories to help prop up local industry, Al Mal reports. Industry figures are particularly unhappy about local gas prices remaining above international prices, said committee head Moataz Mohamed.

Background: Getting natural gas at a lower price has been a longstanding request from factories. The government agreed to set an industry-wide USD 4.50 / mmBtu price for natural gas in March as part of a wider fiscal stimulus package to help support the economy during the pandemic. Manufacturers are still unhappy, since this is around 30% above the USD 3.07 / mmBtu international spot price right now, and have been pushing the government to slash prices further — with some trying to get prices below the international average to help drive the sector’s recovery from covid-19.

Also on the committee’s wish-list: A “Unified Manufacturing Act” that would disentangle ministries’ mandates when it comes to investments and cut down on the bureaucracy to help streamline investment policies, Mohamed said.

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