AMMAN - Jordan is receiving reduced natural gas supplies from Egypt as energy officials in Cairo attempt to hammer out a long-awaited amended pricing agreement.
According to the National Electric Power Company (NEPCO), the Kingdom is currently receiving 50 million cubic feet (MMcf) of Egyptian gas, well short of the 250MMcf stipulated in a 12-year agreement between Cairo and Amman and down from 100MMcf earlier this month.
"The supply so far has not been stable, and we hope to reach a final agreement to raise the amounts next week," NEPCO Director General Ghaleb Maabrah told The Jordan Times.
On Thursday, Minister of Energy and Mineral Resources Khaled Toukan travelled to Cairo to discuss with his Egyptian counterpart outstanding "legal issues" preventing the full resumption of gas supplies, which the Kingdom relies upon for 80 per cent of its electricity generation needs.
"We want to ensure quantities at sufficient supplies and it looks like both sides are converging," Toukan told The Jordan Times.
It is believed that the new agreement brings to an end a favourable pricing structure under which Amman received gas from Egypt at less than half of international market prices.
Energy officials hope to conclude the amended deal, which has been in the works for over two months, by mid-July, ahead of the August peak in electricity demand.
Cairo's demand for a new agreement came after an April 27 attack on the Arab Gas Pipeline in the Sinai disrupted supplies and forced the Kingdom's power plants onto their heavy fuel oil reserves at an estimated cost of $3 million per day.
The unreliability of Egyptian gas supplies has forced energy officials in Amman to consider the import of liquid gas, with plans in place to construct an offshore terminal in the port of Aqaba by 2013.
Amman has received several expressions of interest from international firms in the terminal project, including Royal Dutch Shell, British Petroleum, Lemont/General Electric and Egyptian firm Al Fajr.
© Jordan Times 2011
