Egypt tests suspending load shedding to gauge daily fuel needs

Ahram Online , Tuesday 9 Jul 2024

Egyptian Prime Minister Mostafa Madbouly said on Tuesday that he has issued instructions to suspend load shedding temporarily to gauge the daily fuel consumption needs in the absence of power cuts.

Egyptian Prime Minister Mostafa Madbouly
Egyptian Prime Minister Mostafa Madbouly

This is a pre-step ahead of halting the nationwide load-shedding scheme during summer months by the third week of July, as announced previously by the government, Madbouly told a press conference following the first meeting for the new cabinet.

Madbouly denied that load shedding program has been stopped as of today, as reported by some news outlets. He noted that "it is an experiment" to measure the daily consumption in order to avoid power outages later.

To address the shortage needed for power generation, Egypt has contracted 21 natural gas cargoes to end power outages – exacerbated recently by consecutive heatwaves – in summer months.

“We announced the purchase of [gas] shipments to get through the summer; I requested… to see the maximum load if we stop reducing the loads,” Madbouly explained during the presser.

On Monday, Madbouly presented the new government’s program and vowed to end the power outages completely within six months.

Increased power consumption — especially amid ongoing scorching heatwaves exceeding 44°C in Cairo and climbing over 46 °C in the deep south — put pressure on the mazut and natural gas needed for power generation, according to the government.

Since July 2023, the state has implemented a load-shedding programme that saw rolling power cuts of two hours across neighbourhoods nationwide to deal with energy shortages.

Oil Firms’ Arrears

Additionally, Madbouly instructed the new petroleum and mineral resources minister to develop a plan within a month to schedule the remaining overdue payments to foreign oil companies operating in Egypt.

The government has already paid 20-25 percent of the arrears owed to foreign oil companies operating in Egypt, Madbouly added during the presser.

The prime minister expressed his confidence in Egypt's credibility among international oil companies, noting that the country had faced a similar situation in 2016 when the arrears reached $6 billion.

The government, he added, managed to solve such an issue over four years.

According to an International Monetary Fund (IMF) report issued earlier in March, the Egyptian General Petroleum Corporation’s dues to foreign gas and oil companies have reached around $4.5 billion.

First cabinet's meeting

The new cabinet’s first meeting witnessed the approval of five draft petroleum commitment agreements with expected investments of around $200 million, according to a cabinet statement.

The draft deals involve the Egyptian Natural Gas Holding Company, the Egyptian General Petroleum Corporation, and several international and national companies, delivered by the statement.

During the meeting, Madbouly emphasized that vital files of significant impact on citizens, including price controls and inflation reduction, are a priority.

He added that the government’s economic ministerial group will address these issues in the short term, alongside boosting direct and indirect investments and increasing foreign currency resources.

He also pledged that the government will work on boosting health, education, and industry files in the coming period.

Madbouly highlighted to the ministers the need for constant and effective coordination with all governors on various projects, especially service projects that directly impact citizens' lives.

The political domain

The prime minister stressed the importance of continuous communication with the Board of Trustees of the National Dialogue.

Called by President Abdel-Fattah El-Sisi, the National Dialogue is an initiative that focuses on addressing the nation’s challenges in the political, economic, and social realms.

Madbouly said the government will communicate with the dialogue’s board through specialized sessions involving relevant ministers.

This coordination aims to translate the recommendations and outcomes of the first phase of the dialogue into executive programs, following the presidential directives in this regard, he explained.

Mahmoud Fawzy, Minister of the Parliamentary and Legal Affairs and Political Communication, will be responsible for coordinating these files with the relevant ministers.

In his presence, Madbouly noted that a committee from the cabinet will hold regular meetings with the National Dialogue’s board to monitor the implementation of the outcomes.

The government needs to prioritize attending parliamentary sessions and allocate specific days for meeting with parliament members, he emphasized.

During the meetings, the government will respond to the questions and demands of the MPs as representatives of citizens, Madbouly explained.

Short link: