Rudderless oil and gas explorer BG Group today threatened to shut down its Egyptian operations amid ongoing political turmoil and unpaid bills.
The country’s government, led by army chief Abdul Fattah al-Sisi after last year’s coup to depose Mohammed Morsi, is diverting virtually all the natural gas produced from BG’s offshore fields to keep the lights on at home.
There have been no shipments from BG’s liquefied natural-gas terminal at Idku during the first quarter as a result. The reservoir of gas from Egyptian fields is also dwindling, leaving production down by 35% between January and March.
The damage is such that Egypt has shrunk from a fifth to a 10th of overall production.
BG, which ousted chief executive Chris Finlayson on Monday, is owed $1.4 billion (£829 million) for the gas, of which $700 million is overdue.
“In the absence of concerted action from the Egyptian government, the future commercial operation of Egyptian LNG is increasingly at risk,” the company warned.
