Egypt wants to raise price of gas to Jordan

AFP, Tuesday 8 Mar 2011

Egypt, which provides 80 per cent of the kingdom's electricity needs, won't resume exports before increase is approved

Egypt, which cut gas supplies to Jordan and Israel after saboteurs attacked a pipeline in February, wants to increase the price the kingdom pays, an official said on Tuesday.

"Egypt has officially informed Jordan that the gas supplies will resume only if Amman signs an agreement on new rates," the official told AFP.

Egypt used to sell gas to Jordan at a discounted price half of the market price, or $3 (2.16 euros) per million British Thermal Unit (1,000 cubic feet of gas equals 1.027 million BTU), he said.

A Western diplomat in Amman told AFP the delay in the resumption of Egyptian gas "is motivated by political reasons because there is widespread opposition, especially in Sinai, against the resumption of gas supply to Israel."

"In this context, it is difficult for Egypt to export gas to Jordan, and not Israel, without raising an international outcry," the source said.

Attackers used explosives against the pipeline in the town of Lihfen in northern Sinai, near the Gaza Strip.

Jordan imports around 240 million cubic feet of Egyptian gas a day, which accounts for 80 percent of the kingdom's electricity needs.

The country's Central Electricity Generation Co, which supplies 50 percent of electricity in Jordan, said it loses $2.2 million a day because of the gas cut.

"Jordan's overall losses are estimated at around $4.2 million a day," CEGC director Abdul Fattah Nsour told AFP.

On Monday, Jordan on Monday decided to ration power consumption for the government and the armed forces by 50 percent, the state-run Petra news agency said.

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