By Taylor Luck

AMMAN – Amman and Cairo have yet to close in on an amended natural gas deal, according to energy officials, as repairs are ongoing following this month’s act of sabotage on the Arab Gas Pipeline.

According to Minister of Energy and Mineral Resources Khaled Toukan, Jordanian officials have yet to be informed by Cairo when pumping of Egyptian gas will resume, as both sides consider an amended gas agreement bringing an end to a favourable pricing structure under which Jordan received gas at prices less than half the international rate.

Egyptian authorities previously estimated that repairs on the pipeline, which were damaged on July 12 in what marked the second Sinai explosion less than a month, would take 7-10 days.

Earlier this year, attacks in February and April caused two separate six-week disruptions forcing the Kingdom’s power plants onto their costly heavy oil and diesel reserves at a cost of $3 million per day.


According to the Ministry of Finance, the continuous disruptions in natural gas supplies cost the Kingdom JD637 million in the first half of the year.

Egyptian gas supplies have yet to return to pre-attack levels and prior to the most recent attack on the pipeline dropped to 60 million cubic feet – well below the 240 million cubic feet stipulated in a 12-year agreement between the two sides.

Under an amended gas deal, Amman is expected to receive 175 million cubic feet by the end of this year, a level that is to increase to 225 million cubic feet by 2012.

The unreliability of Egyptian gas supplies, which Amman counts on for 80 per cent of its electricity generation needs, has pressured Jordanian authorities to look for alternative energy sources including liquefied gas and increased heavy oil imports from Iraq.

As part of decision makers’ drive for liquefied gas, plans are in place to construct an offshore terminal in the Port of Aqaba by 2013, with Jordan receiving initial interest from Royal Dutch Shell, British Petroleum, Lemont/General Electric and Al Fijr.

The search for alternative energy imports comes as Amman attempts to cover a five-year gap period ahead of the development of domestic energy sources including oil shale, wind, solar and nuclear power.

Jordan currently imports 97 per cent of its energy needs at a cost of one-fifth of the gross domestic product.