Can you tell us about the key features of Egypt’s national gas grid and its potential for future expansion?

Certainly. The national gas grid in Egypt serves as a crucial link between gas producers and consumers. It is the largest and longest gas grid in Africa and the Middle East, spanning a length of 7,620 kilometers. This is a significant growth from its initial length of 2,800 kilometers when it was established in 1997, marking an impressive evolution rate of 272%. Over the years, the grid’s transportation capacity has increased more than sixfold, reaching 240 million cubic meters (8.48 billion cubic feet) per day by the end of 2018, compared to 37 million cubic meters (1.31 billion cubic feet) per day in March 1997.

The national gas grid covers a vast area, extending from the Nile Delta and Western Desert region to Aswan in the South Valley (Upper Egypt) and further eastward to Sinai along the coast of the Red Sea. The expansion of the grid is essential to support the ambitious economic and social development plans in Egypt.

Moreover, GASCO, the national gas grid operator, has been involved in implementing pipeline projects in neighboring countries, such as Jordan, and is responsible for managing and operating phases two and three of the Arab gas pipeline. This pipeline stretches from Aqaba in Jordan to the Jordanian-Syrian border, covering a distance of 424 kilometers. Additionally, GASCO operates and maintains reduction and metering stations for 12 power stations.

How does Egypt’s recent achievement of gas self-sufficiency contribute to its position as the East Mediterranean energy hub and the growth of its petrochemicals portfolio?

Egypt’s achievement of gas self-sufficiency, thanks to significant gas discoveries like the Zohr gas field and other deepwater fields in the Mediterranean Sea, has had a transformative impact. The country has halted LNG imports since September 2018, successfully securing gas supply for the electricity and industry sectors, which was a crucial strategic objective. Furthermore, gas exports to Jordan resumed in the fourth quarter of 2018 after a three-year hiatus.

The availability of natural gas has created opportunities for the growth of value-added industries, particularly in the petrochemical sector. Egypt is well-positioned to become the East Mediterranean energy hub, as demonstrated by the agreement among Eastern Mediterranean countries to establish a regional gas market. This initiative aims to reduce infrastructure costs and provide competitive prices, fostering regional cooperation and trade.

What are the assets owned by GASCO, and how do they contribute to its operations?

GASCO owns several key assets that play a vital role in its operations. The Western Desert Gas Complex (WDGC) is the first NGL (natural gas liquids) plant in Egypt, producing an ethane/propane mixture for the petrochemical industry, as well as commercial propane. Located in the Al-Amerya area of Alexandria, the plant began regular production in the mid-2000s. It receives and treats 900 million standard cubic feet per day (MMSCFD) from Western Desert gas fields and produced various products in 2018, including 2.127 million tonnes of ethane/propane mixture, commercial propane, LPG, and condensate.

GASCO also operates and maintains the National Advanced Transmission & Automation Centre (NATA), which has been operational since October 2003. NATA ensures the safe and efficient supply of gas by utilizing advanced technologies and programs. Additionally, GASCO is involved in the establishment of 22 sister companies that operate in various activities related to natural gas and its derivatives, further enhancing its business benefits.

Could you provide an overview of GASCO’s recent activities in natural gas projects, processing plants, pipelines, and construction and maintenance?

In 2018, GASCO implemented several projects within the gas grid, covering a total length of 130 kilometers. These projects included supplying natural gas to Siemens’ power plants and ongoing projects aimed at supporting the national grid. For instance, there were pipeline projects to supply the ELNG (Egyptian Liquefied Natural Gas) plant and to transport gas from the Zohr field to the power station in the New Administrative Capital. Furthermore, GASCO completed 12 feeding offtakes for gas transportation and distribution companies.

GASCO also focused on the installation and operation of reduction and metering stations for power stations such as West Assiut, South Helwan, the extension of the 6th October power station, and the Suez thermal power station. Additionally, they completed three reduction and metering stations for the Egyptian Refining Company in Mostorod, KIMA’s urea and ammonia plant in Aswan, and the Industrial Developers Area in the 10th of Ramadan industrial zone.

In terms of gas plant projects, GASCO is implementing a pipeline project to transport Raven field gas in the North Alexandria concession area to its plants. This project aims to compensate for the expected decrease in feed gas from Western Desert fields and maintain a stable production level of natural gas derivatives at the WDGC and Amerya LPG plant.

What types of contracts does GASCO have, and who are its clients?

GASCO engages in various types of contracts. They have gas delivery contracts with different natural gas customers, as well as project services and execution contracts with contractors for new projects. Additionally, GASCO has product sales contracts with downstream companies for the products produced in its plants.

How does GASCO integrate with its sister companies, and what agreements are in place to provide feedstock to industries?

GASCO actively collaborates with its sister companies to maximize the value derived from natural gas and its derivatives. For example, GASCO provides a mixture of ethane/propane as a feedstock to petrochemical companies like Ethydco and Sidpec for their plants. Commercial propane is also supplied to the propylene production plant currently under construction at Sidpec, and LPG and condensate support domestic market consumption.

Furthermore, GASCO is a shareholder in several sister companies. They have invested in UGDC’s natural gas derivatives extraction plant in Port Said, as well as Ethydco, which operates an ethylene and polyethylene production plant. GASCO has partnerships with many other companies involved in natural gas distribution activities.

Could you explain the key features of the National Advanced Transmission & Automation Centre and how it enhances operational efficiencies?

The National Advanced Transmission & Automation Centre (NATA) serves as the core control center for GASCO’s operations. It is a strategically selected innovation to ensure optimal performance and safe gas supply in the national gas grid. NATA has been built using advanced technologies and programs, allowing GASCO to maintain maximum control over the grid.

The centre incorporates a range of integrated systems, such as supervisory control and data acquisition systems (SCADA), gas grid analysis, and gas grid upgrading and maintenance. The SCADA system, in particular, enables comprehensive control and coordination of gas transmission and distribution. It provides real-time monitoring, analysis of potential failures or leaks, and facilitates remote management. NATA’s advanced technology and decision-making support systems enhance the efficiency of gas supply operations.

What services are offered through the Pipeline Integrity Management Centre of Excellence (PIMCOE)?

PIMCOE, the Pipeline Integrity Management Centre of Excellence, is the first center of its kind in the Middle East. Its primary focus is to ensure operational excellence and provide customers with top-notch inspection, pigging proficiency, and rehabilitation services.

In 2018 alone, PIMCOE conducted inspections on a total length of 410 kilometers within the national gas grid and 283 kilometers of lines owned by the Badr El Din Petroleum Company. Since its establishment in 2006, PIMCOE has inspected a cumulative length of pipelines reaching 8,180 kilometers. Furthermore, PIMCOE has successfully executed various inspection and pigging services in countries such as China, England, the USA, Australia, and Saudi Arabia, accumulating a total of 605 working days.

What is GASCO’s outlook and strategy for 2022?

In 2019, GASCO has set several strategic objectives. One of the primary goals is to comprehensively assess the performance of the national grid under different natural gas supply and demand scenarios, taking into account production and consumption forecasts. This assessment is particularly important following the significant gas discoveries in the Mediterranean Sea.

Additionally, GASCO aims to identify necessary expansion and modifications within the national grid to enhance efficiency and achieve a proper balance in operating pressure across different grid areas. They will also focus on technical reviews and rehabilitation of grid components to align with the network code of the gas market regulatory authority.

Moreover, GASCO plans to enhance the functionality of the National Advanced Transmission & Automation Centre (NATA) by adopting the latest technologies. This will support decision-making processes during various operations of the national gas grid, enabling more efficient maneuvering.