The Egyptian government has raised the tariff for transporting natural gas through the national grid, setting it at USD 0.50 per mn British thermal units (BTU), a one-third increase from 2023’s USD 0.376, a government source in the energy sector told EnterpriseAM. To this end, the country’s 12 gas distribution networks are being restructured to adjust how gas volumes and tariffs are managed, aiming to allow more companies to enter the market, the government source said.

Nine months late: Transmission license holders had continued to pay the 2023 tariff until this decision. Traditionally, the transmission tariff is reviewed annually, taking into account investment costs and operating expenses.

The new rate will reportedly be applied retroactively to all network users, the official said, with the difference between the old and new charges to be collected in installments rather than as a lump sum, Al Mal reported.

Preparations are already underway for the 2025 tariff. Its calculation methodology has been approved and referred to Gasco, the state-owned company licensed to operate, maintain, and develop the national gas network, for review. Gasco is currently calculating the final figure, which will be submitted to the Gas Regulatory Authority for approval and ratification.

REMEMBER- Tariffs are determined using a formula that takes into account several variables, including the USD/EGP exchange rate and the total volume of gas pumped through the grid during the year.

ON A RELATED NOTE- The Egyptian government is looking to liberalize the natural gas market by allowing multiple suppliers to make direct sales to private-sector customers, a government source told EnterpriseAM. The new system would give large industrial players the option to secure their gas needs through direct contracts with suppliers if they can get better prices or terms, we were told.

The move will support Egypt’s efforts to one day become a regional energy hub, the source explained. Establishing a market where private-sector suppliers — both local and foreign — can sell directly to end users will develop the logistical, financial, and bureaucratic networks needed to support the government’s long-planned return to being an energy exporter — and a leading regional hub at that.

REMEMBER- The government raised natural gas prices for factories starting 15 September, according to a statement from the Industry Ministry.

IN OTHER GAS DISTRIBUTION NEWS-

Saudi opens prequalification for natural gas network tenders: The Saudi Energy Ministry launched a pre-qualification process for tenders to license, develop, own, and operate natural gas distribution networks in five industrial cities, it said in a statement. The sites include Sudair City for Industry and Business, Al-Kharj Industrial City, and Jeddah’s First, Second, and Third Industrial Cities.

Interested companies have until 25 October to request prequalification documents, with full applications due by 29 November.

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