European Investment Bank lending EUR 50 million to Egyptian Natural Gas Company
Under its Facility for Euro-Mediterranean Investment and Partnership (FEMIP), the European Investment Bank (EIB) is lending EUR 50 million to the Egyptian Natural Gas Company (GASCO) for two gas pipelines of a combined length of 152 km in Egypt.
The pipelines form part of the national gas transmission system that transports natural gas from Egyptian offshore and onshore gas production fields to destinations throughout the country. The objective is to bring Egyptian natural gas to major power plants, industries and domestic consumers, and strengthen the gas transmission system in view of the increasing gas demand.
On the occasion of the signing ceremony, Mr Philippe de Fontaine Vive, EIB Vice-President in charge of FEMIP, commented: "This operation follows on from other FEMIP-financed energy projects in Egypt, in particular the LNG Idku and Damietta projects, the El Nubariya natural gas-fired combined-cycle power plant and the construction of “Arab gas line” , connecting Egypt’s gas network with Jordan’s. All these ventures illustrate the catalytic role that FEMIP can play in capital projects carried out in the Mediterranean Partner Countries".
The project, which includes the design, construction, commissioning and commercial operation of the two gas pipelines will help reduce power generation costs by replacing oil with gas at existing power stations.
Additionally, the new combined cycle plants will raise the overall efficiency of the power system, increase supply of electricity to meet demand growth and diversify energy supplies. Egyptian industry will also benefit from lower cost electricity and will be able over time to adopt internationally competitive gas based technologies. At the same time this conversion will have beneficial effects on the environment as it will significantly reduce polluting emissions.
This operation underpins FEMIP’s continuing support to Egypt to develop its promising gas sector, through private and public sector investments.