Taba-Aqaba pipeline opens next month - pace to hot up for largest undersea gas field
Egypt-Jordan, Economics, 5/15/2003

Egypt's Petroleum Minister Sameh Fahmy and the Jordanian Minister of Energy Mohamed el-Bataina yesterday inspected the final phase of the project that will bring Egyptian natural gas to Jordan as from next month.

The 14-kilometre undersea pipeline from Taba to Aqaba will be part of a network linking Egypt, Jordan, Syria and Lebanon.

Work on the 248 kilometres of pipeline from el-Arish to Taba was completed a few months ago, Minister Fahmy said.

It has been decided that the consortium of Egyptian companies won the bid for tenders issued by the Jordanian government to extend the pipeline from Aqaba to the Syrian border, a distance of 380 kilometres, at a cost of $350 million, Fahmy said, adding that the project is due to be completed by 2005.

Egypt will be exporting 10 billion cubic metres of gas per day to Jordan, he said.

The Shura Council Industrial Production and Energy Committee two days before had inspected projects undertaken by the Alexandria Minerals and Oil Company (AMOC) and the Alexandria-based Sidi Kirir Petrochemicals Company (SIDPAC).

AMOC chairman Magdy Abdel Moneim said that the two main complexes had been completed, of which the first is for the production of 110,000 tonnes a year of lubricating oils and 32,000 tonnes of paraffin wax.

The second complex is for the production of 460,000 tonnes per year of heavy fuel and 43,000 tonnes of butane gas.

The company's output will contribute greatly to supplying local demand for lubricating and heavy fuel oils, worth an annual $140 million, in addition to $90 million worth of exports, Abdel Moneim said.

Managing Director of SIDPAC Osama Fouad said that the production of ethylene and polyethylene will supply local manufacturers, who previously had to import these substances.

For the first time in Egypt, SIDPAC will be producing 300,000 tonnes of ethylene a year, plus low and high-density polyethylene 225,000 tonnes annually.

More than LE2.2 billion has been invested in the SIDPAC chemicals production complex, of which the projected output will be worth $285 million a year, saving import costs and helping to narrow the trade deficit in foreign reserves.

SIDPAC is expected to produce 77,000 tonnes of polyvinyl-chloride (PVC) worth LE172 million annually, Fouad said.

The company is capable of supplying local demand for polyethylene, which is anticipated to amount to 237 tonnes worth LE742 million ($112 million) a year.

In a related development, Petroleum Minister Sameh Fahmy has issued instructions for speeding up work on developing Scarab-Saffron, the first offshore gas field, which will be the first deep water field in Egypt, the Mediterranean and the Middle East.

The field is located in the West Delta at 1,000 metres under water, 100 kilometres off the coast. The operation is on a similar scale to those carried out in the North Sea and the Gulf of Mexico, requiring huge investment and state-of-the-art technologies.

The Shura Council Industry and Energy Committee went on an inspection tour of the Rashid gas field project last Thursday.

Production targets have been set at 808 million cubic metres a day for local consumption and a further 123 million cubic metres a day for export.

More than 3.5 million tonnes of liquid petroleum gas are destined for export to France and other European Union (EU) countries.

The Simian and Sinia fields are due to come on line for the first liquefaction plant that is due to begin operations in 2005, while production from Sapphire field in Barlis is set to double and feed the second liquefaction plant, which is scheduled to come into operation in early January 2006.

Both plants have been constructed at a total cost of $9 million.

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