Egypt expects to soon draft a repayment schedule to pay US$3.5 billion in arrears it owes to foreign oil and gas companies, Egyptian Petroleum Minister Tarek El Molla said on Tuesday, 14th February.
“We didn’t yet set a date, however we are committed. We are going to have shortly a repayment schedule agreement with partners,” Reuters quoted El Molla as saying on the sidelines of an oil industry event in Cairo.
Last month, the minister told Reuters that his country was committed to repaying arrears, but Egypt’s insufficient foreign currency reserves were making the debt repayment difficult. Although setting a repayment schedule in place would take some time, Egypt was making monthly payments to foreign firms to avoid piling up of more debts, El Molla said.
The IMF is calling for immediate actions to restore the company’s financial stability with an action plan to be developed by the end of March this year, which would also include a strategy to settle outstanding arrears.
Meanwhile, the company will make sure that no new arrears are accumulated, and “will seek to reach agreements with creditors on the repayment schedule of the current stock to gradually eliminate it by end-June 2019,” the IMF said.
In addition, the IMF said that Egypt has “an enormous potential to become a major producer and a supplier of natural gas”. The country’s gas output has dropped considerably since the 2011 revolution, but new fields have been developed in the Nile delta and Egypt’s waters in the Mediterranean in the recent years, of which the Zohr field is the most promising.
At the end of last year, Egypt signed several large deals with a handful of oil majors, which could lead to more oil and gas production in the energy-starved nation. (source:
By Tsvetana Paraskova for Oilprice.com)