Gas supplies to resume next week

Pumping of Egyptian gas to the Kingdom is slated to resume next week as energy officials continue their search for alternative energy sources for the peak summer season. Initial repairs are nearly complete on the Arab Gas Pipeline, which was damaged in an explosion on July 12, the fourth act of sabotage since February, according to an energy official who preferred to remain unnamed as he was not authorised to speak on the subject. The official expected to see the resumption of the pumping next week. In light of the cut in supply - estimated to cost the Kingdom some $3 million per day - energy officials are exploring increased heavy oil imports from Iraq. Prior to the most recent act of sabotage, Cairo was expected to boost supplies from 50 million to 100 million cubic feet per day, well short of the 240 million cubic feet stipulated in a 12-year agreement between the two sides. Under a recent agreement between Baghdad and Amman, Jordan receives 30,000 tonnes of heavy oil per day at a discount of $88 per tonne. Energy officials in Amman expect the Egyptian gas to return by early next week, but remain sceptical of the reliability of supply, particularly after previous attacks on the pipeline earlier this year led to two separate six-week disruptions. Cairo has come under increasing popular pressure since the January 25 uprising to end gas exports to Jordan and Israel and prioritise the resource for domestic use. The unreliability of supply has forced officials to explore the import of liquefied gas, with plans in place to construct an offshore terminal in the Port of Aqaba by 2013. Several international firms have expressed initial interest in the project including Royal Dutch Shell, British Petroleum, Lemont/GE and Al Fijr. The drive for liquefied gas comes as Amman attempts to cover a five-year gap period ahead of the development of domestic energy sources including wind, solar and nuclear power. The Kingdom currently imports 97 per cent of its energy needs at a cost of one-fifth of the gross domestic product.