BP and Malaysia’s Petronas will invest $1 billion to drill 9 wells for natural gas in Egypt, expected to produce up to 1600 cubic feet of gas daily, reports Al Ahram this morning (Arabic). Egypt needs to up the ante on exploration at home considering the country’s natural gas shortage, and the consequences of this (i.e., chronic electricity cuts because most power stations are run using natural gas).
Egypt’s state wheat buyer, the General Authority for Supply Commodities (GASC), on Friday set its fourth international wheat tender in three weeks, seeking an unspecified volume for October 11-20 shipment. Egypt is the biggest net importer of wheat – making drought concerns in Russia a big concern. Looks like GASC is stockpiling while it can.
Egypt’s first sale of Euro-denominated bonds did better than expected, exceeding the goal set. This is Egypt’s attempt to diversify its currency reserves and get some different hard cash into its coffers. It’s already had a go at selling dollar-denominated bonds.
Standard & Poors rating agency says a currency devaluation in Egypt is “likely” if foreign reserve levels don’t increase.
We believe that a managed devaluation could provide some respite for Egypt’s external financing needs. However, in order to smooth the transition to a more flexible exchange rate, tighter fiscal and monetary policies will likely be required.
That’s a few days after President Morsi ruled out a devaluation. But increasingly, indications are pointing to confusion within the Muslim Brotherhood, where behind the scenes advisors and economic teams have different point of views over whether there should be a devaluation or not.
EFG Hermes to hold second shareholder meeting September 16 to review the proposed creation of an investment bank with Qatar’s QInvest, after the deal failed to get regulatory approval in Egypt.
Ampal-American Israel Corp filed for Chapter 11 bankruptcy protection as it faces deepening financial troubles in the wake of a halt to natural gas supplies to Israel from Egypt. But despite the current worries over natural gas in Israel, new discoveries and vast wells point to no problem with Israel’s energy needs, as the FT’s Tobias Buck explains in this great report, “Field of Dreams”.
Qatar’s Rasgas has found a virus in its office computer network, the world’s second-biggest liquefied natural gas exporter said, just two weeks after the world’s biggest oil producer in neighbouring Saudi Arabia was hacked into. It begs the question (again), how do these behemoth companies get away with such poor infrastructure?
Glencore’s attempt to form the world’s fourth-largest mining conglomerate by acquiring Xstrata edged closer to collapse after sovereign wealth fund Qatar Holding said it would vote against a deal at the current offer price.
South Sudan could take 6 months to resume oil output. That’s not a surprise considering landlocked South Sudan, which seceded from Sudan last year, shut down its production of roughly 350,000 barrels per day in January and tensions are still running high.