Egypt Debt to Oil Partners Isn’t Thwarting Spend, Official Says

Egypt continues to attract investment from overseas oil companies operating in the North African nation even if they are owed payments by the nation’s government, according to Egyptian Natural Gas Holding Co.

The state-run gas company’s debts to overseas partners “aren’t that high,” Chairman Mohamed Shoeib said today in a telephone interview from Cairo, declining to be more specific.

Egyptian state-owned oil companies “have a mechanism for payments that we agreed upon with the foreign partners in such a way that does not prevent them from pumping new investments in Egypt,” he said.

Dana Petroleum Plc is owed tens of millions of dollars, Nick Dancer, the company’s managing director and manager for Egypt, said on Sept. 11.

The nation’s oil and gas exploration tender issued by Egas in May guarantees terms and conditions that prevent the accumulation of debt on state companies because foreign companies will have the right to sell the gas in local and international markets, according to Shoeib.

State-owned Egyptian General Petroleum Corp. made payments of $9 billion due to its foreign partners in the fiscal year that ended on June 30, the Al Ahram website cited Chairman Hani Dahi as saying on Sept. 23.

To contact the reporter on this story: Ola Galal in Cairo at ogalal@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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