The Egyptian Prime Minister issued a decision setting the selling price of natural gas supplied to industrial activities, including an increase in prices for iron and steel factories, cement, fertilizers and petrochemicals from $4.5 per million thermal units to 5.75, an increase of 28%.
The resolution stipulates that, the selling price of natural gas supplied to industrial activities shall be determined as follows:
$5.75 per million British thermal units for the cement industry.
$5.75 per million British thermal units for the iron and steel industries.
$5.75 per million British thermal units for the fertilizer and petrochemical industries, or according to the price formula mentioned in the contracts.
$4.75 per million British thermal units for all other industrial activities.
The decision indicated that it was based on the results of the work and recommendations of the committee formed under Prime Minister Decision No. 1884 of 2019, and according to what was presented by the Engineer, Minister of Petroleum and Mineral Resources, and after the approval of the Council of Ministers, to start implementation on November 1.
The government lowered gas prices for the industrial sector twice, the first in October 2019, targeting consumption-intensive factories, and the second in March 2020 as part of a stimulus package for the private sector to help it overcome the burdens of the Corona virus crisis, until the price of gas reached 4.5 dollars per million thermal units.
The government sells gas to factories at a price of $4.5 per million thermal units, while factories are constantly calling for a reduction in the price to be equal to the world price of gas, which is less than $3 per million thermal units, to ease pressure on factories as a result of high production costs.