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UPDATE 1-Qatar to give Egypt 5 natural gas cargoes in July-Sept
June 10, 2013 / 2:31 PM / 4 years ago

UPDATE 1-Qatar to give Egypt 5 natural gas cargoes in July-Sept

(Adds details, background)

CAIRO, June 10 (Reuters) - Qatar will grant Egypt five shipments of natural gas to help Egyptians get through the summer until mid-September, a statement from the Egyptian Petroleum Ministry said on Monday.

“Qatar will supply five cargoes of liquefied natural gas as a gift to the Egyptian people during the summer months, with the first of these shipments beginning at the end of July (and continuing) until mid-September,” Qatar’s Energy and Industry Minister Mohammed al-Sada was quoted as saying in the statement.

The statement did not give the size of the shipments.

A delegation of Egyptian officials, including Egypt’s Oil Minister Sherif Hadara, met with Sada ahead of the decision.

The gas shipments will help Egypt get through a hot summer when energy consumption usually rises and the country faces frequent power cuts.

In April, Qatari Prime Minister Sheikh Hamad bin Jassim al-Thani said the gas-rich Gulf state would extend gas supplies to Egypt this summer as needed.

Qatar will not deliver LNG directly to Egypt, which lacks the import infrastructure to accept shipments, but instead will replace exports from Egypt with its own gas.

At current prices the Qatari cargoes would fetch about $321 million on the open LNG spot market, based on a typical Qatari shipment of 210,000 cubic meters and prevailing Asian spot LNG prices.

Under the deal, Egypt will take a share of natural gas produced by foreign companies for its domestic use and Qatar will export LNG directly to the foreign companies’ customers.

BG Group, a stakeholder in the Idku LNG export terminal, is expected to benefit from the swap deal between Qatar and Egypt.

BG Group CEO Chris Finlayson said in May that an inter-governmental LNG swap deal would be a “win-win” for Egypt and for BG Group, which would gain access to additional LNG volumes. (Reporting by Asma Alsharif and Patrick Werr and Oleg Vukmanovic in London; editing by Jeff Coelho)

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