Egypt to Pay Back Its Oil-Company Debt by Mid-2016 - Minister

By Summer Said

Egypt plans to repay its $3.1 billion debt to international energy companies operating in the country by mid-2016, almost a year later than initially planned, the country's oil minister said.

"We have already reduced the debt from $6.3 billion at the start of 2013 to $3.1 billion at the end of last year," Oil Minister Sherif Ismail told The Wall Street Journal in an interview. "We have no certain timetable for the next payments but we plan to pay back the entire amount by mid next year."

Since the ouster of President Hosni Mubarak in 2011 and the turmoil that ensued, Egypt has struggled to pay foreign energy companies that provide oil and gas for its domestic market, including: BP PLC (BP), Apache Corp. (APA), BG Group (BG.LN) and Dana Gas PJSC (DANA.AD), an energy company based in the United Arab Emirates.

Egyptian officials hope the repayment pledge encourages energy companies to continue injecting investments in research, exploration and development activities into the country.

The country has been facing a slowdown in oil and gas exploration activities over the past few years because of continuing civil unrest since Mr. Mubarak was overthrown. It has been paying hefty premiums for its crude supplies because of the weaker Egyptian pound.

In November, Egyptian officials said the country planned to repay all debt owed to foreign oil and gas companies within six months, a deadline that was approaching before Tuesday's announcement pushing the date back to 2016.

Write to Summer Said at [e-mail]

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