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Negotiations for setting up an exchange for trading natural gas kicked-off

Monday 06 August 2018 08:05 PM

Medhat El-Sherif
Medhat El-Sherif

By Nesma Bayumi & Ahmed Aly
The Egyptian Stock Exchange kicked-in negotiations with Ministry of Petroleum over setting up an exchange for pricing natural gas in pursuance with new law permitting the privately-owned companies to import and export natural gas.
President Abd El-Fattah El-Sisi has approved back in last August a law regulating gas market stipulating setting up an agency for organizing the market and licensing private importers.
" Leaders of EGX and Ministry of Petroleum convened last week to discuss steps necessary for setting up Egypt's first commodity exchange," said informed sources at EGX.
Latest capital market law amendments approved by House of Representatives back in February allowed EGX to set up an exchange for futures and commodities.
Commodities exchange allows investors to enter into agreement for buying  crops including wheat, corn, rice, soya beans, coffee beans  before they are planted and to register the agreement at the exchange which may, henceforth, start buying and selling the crop.
" Setting up a commodities exchange in Egypt hinges upon turning Egypt into a regional hub for energy trading as well as upon  neighboring countries starting to sell their own gas in Egypt," said former chairman of Midor and Mobaco Eng. Medhat Yusef.
The agency due to be established  in order to organize the market shall not be concerned with gas pricing but with pricing  services related to gas, including transports and using up the national gas grid.
Prices of Egyptian gas shall be determined by the Ministerial Cabinet and the Higher Energy Council, he added.
The Egyptian government, in collaboration with the International Monetary Fund adopts a five-year plan for liberalizing energy prices by 2019.