Egypt’s gas shortages to delay $2.2b Petrochemical Project

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A $2.2 billion fertilizer complex located in Damietta, Egypt is among the petrochemical projects set to experience delays owing to gas shortages. The delay is due to the fact that these projects rely on natural gas.

The announcement comes amidst persistent efforts by the government to beat gas shortages that have locked the country. Many oil and gas fields were shut following protests by groups with interests, since the ouster of former Prime Minister Mohamed Morsi.

A $408 million polystyrene complex located in Alexandria’s Damietta port will also be part of the projects launched, and which will face delays. The Minister of Petroleum, Mr. Sherif Ismail announced that a $2.2 billion fertilizer complex was also affected. This complex was planned to produce a total of 200, 000 tons per annum (tpa).

“The country is suffering from a shortage in gas supplies, which has affected completion of some petrochemical projects, on which work had already started.” Ismail said, adding that they relied on gas. Meanwhile, the country has turned to projects that use of naphtha.

Western Desert’s $1.6 billion ethylene and derivatives project will also go slow owing to the gas shortages. This, together with the polystyrene complex, will now go to the testing phase in the first quarter of 2015. The minister said they were expected to undergo this stage during the first half of 2014.

A complex at Suez Gulf Industrial Zone, planned for production of benzene, propylene and polyethylene, will also be expected to consume a $2 billion of the exchequer. The petrochemical project was earlier on launched by the of the General Authority for the Northwestern Suez Gulf Economic Zone.