Parliament urges Cabinet to review Egypt-Saudi Aramco deal

Parliamentary sources said that the Energy Committee intends to call on the Ministry of Petroleum to review the agreement with Aramco to find out why the petroleum shipment supplied to Egypt was suspended in October.

The sources added that they previously requested to meet with Minster of Petroleum Tarek El Molla and hope that he and the chairperson of the Egyptian General Petroleum Corporation (EGPC) will attend the meeting on Sunday.

The parliament will specify its requirements from the EGPC according to the details of the Aramco agreement.

Member of the Energy Committee, Hamada Ghallab, said that relations between the two countries are strong and they will find out the reasons behind the suspension of petroleum shipments in October and identify the scenarios for the November shipment.

Ghallab explained that the committee will request that the Ministry of Petroleum encourage foreign companies to increase their investments in the oil fields to increase production in exchange for providing facilities, such as paying for the foreign partner’s share in US dollars or allowing them to transfer profits abroad.

The foreign partner obtains a 45-50% share of the production, according to the agreement signed with the Ministry of Petroleum.

A source at the ministry told Daily News Egypt that Aramco has not officially informed them about resupplying Egypt with petroleum shipments in November. Therefore, the ministry will offer a precautionary tender for the quantities signed with the Saudi company, as no supplies have been received as of yet.

He noted that the Ministry of Petroleum has no information about the suspension of supplies during October. Sovereign parties in the state are managing that file with the Saudi side to find out Aramco’s position for supplying part of Egypt’s needs for five years.

The Ministry of Petroleum signed a commercial agreement with Aramco to provide Egypt with petroleum derivatives for five years, starting in May, with an interest rate of 2% and a grace period valid at least for three years. The EGPC is obliged to repay the dues.

This agreement comes after signing a financing contract between the EGPC and the Saudi Fund for Development, on the sidelines of the Coordinating Council’s meeting between the two countries, which was held in Riyadh in March.

The total cost of shipments are worth $30bn over a five-year period, in the event that the low price of petroleum continues.

Source: Daily News Egypt