Egypt to Liberalise Downstream Gas

Egypt is taking the first steps to liberalise and deregulate its gas market through gradual privatisation in the hope of making the country a regional energy hub.

The House of Representatives passed a draft law December 21 that would require the establishment of a new natural gas regulator. It will oversee the industry on all its activities (apart from exploration and production) and will issue licences and permits to players in the industry.

The relevant industry will be divided into five main categories: pipeline operators, distributors, storage providers, gas shippers and importers.

The regulator will have a say on gas prices along the entire supply chain taking into account investment costs, developing the pipeline infrastructure, and projected returns on investment.

Privatisation will take place in stages determined by the new regulator. Gas exporters will be charged special fees for using the pipeline infrastructure.

It is hoped that the new law, expected to be adopted by the end of 2017, will enable private companies to enter the gas sector and streamline it.

Ya'acov Zalel