“Egyptian gas exports to Jordan will start in May,” he said, after talks with his counterparts Sameh Fahmy, Ibrahim Haddad, from Syria, and Abdul Hameed Beidun, from Lebanon.
Sameh Fahmy said that the Egypt-Jordan portion of a regional gas grid, which runs under the Gulf of Aqaba, will be “inaugurated in June in the presence of (Egyptian) President Hosni Mubarak and King Abdallah II of Jordan.” From Jordan, the pipeline will be extended north to Syria, with deliveries expected to start in 2005, and then west to Lebanon, Mr Batayneh said. He gave no date for deliveries in Lebanon, but Mr Fahmy said several months ago these could also start in 2005. Syria’s Ibrahim Haddad said further talks would be held with Cyprus, Turkey, Bulgaria, and Romania on the possibility of extending the pipeline.
Syria has plans to use the pipeline to export its own gas to Cyprus, Turkey, and Eastern Europe if it makes new discoveries. The country’s gas production increased rapidly in the 1990s, but all of it is still consumed locally, mainly for electrical power generation.
Sameh Fahmy said the Egypt-Jordan portion of the pipeline would cost $230million, the Jordan-Syria portion around $300million, and the Syria-Lebanon portion about $400million. He said the four ministers have agreed on setting-up two bodies tasked with operating and developing the pipeline, the Arab Gas Organization, to be based in Beirut, and the Arab Company for Gas Transport and Marketing, to be based in Damascus. The Arab Gas Organization will co-ordinate work between natural gas companies in the four states and be tasked with quality control, reviewing tariffs, and studies to develop the pipeline, he said. The Arab Company for Gas Transport and Marketing will oversee funding, construction, operation, and maintenance of the pipeline, including its expansion to other states.
The Kuwait-based Arab Fund for Economic and Social Development and the Kuwaiti Development Fund have already announced they would contribute to the pipeline financing. The four Arab states indicated last year their interest in setting up an initial deal to develop the pipeline. The project is second major cooperation project between Egypt, Jordan, and Syria after they linked their electrical grids in 2001.
Egypt’s known natural gas reserves have steadily increased over the past 10 years, reaching 1656Bcm last October, and it is now actively looking for export markets. Besides the regional gas grid, Egypt will start exports of liquefied natural gas in 2004 to Spain, and in 2005 to France. The country also has plans to set-up a pipeline to deliver natural gas to Libya for power generation and water desalination plants. This pipeline could be extended at a latter stage for export across the Mediterranean to Europe.