Egypt’s cabinet approves gas installation fee hike for households

Lower-income people will be exempted from the price increase, says oil minister

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Egypt's cabinet okayed on Saturday the hike in installation fees for domestic gas connections, ahramonline reported, quoting oil minister Tarek El-Molla.

El-Molla said that the charges have been raised by $39.33 (EGP 350) to reach a total of $207.88 (EGP 1,850) to factor in the cost of delivery of natural gas to residences.

However, the minister clarified, that lower-income people will be exempted from the price increase.

The new domestic gas charges have been introduced in the backdrop of the economic reforms plan which has already seen the hike in power charges. Reducing subsidies and imposing new levies to make up for the huge government deficit is part of the reform package. The 2015/16 budget deficit is estimated at 11.5 per cent of GDP.

Sahar Nasr, Minister of International Cooperation, has in the meanwhile discussed the financing of the household gas connection project with the World Bank. The Bank is to provide $500 million, while European Union will extend a grant 68 million euros, and 70 million euros coming from the French Development Agency (AFD).

Sahar in her talks with the World Bank wanted the governorates included in the project to go up to 20, instead of 11, with natural gas being delivered to 2.4 million households over 4 years, including 1.1 million households in 11 governorates.

According to government figures, around 7.2 million residences in Egypt have natural gas connections as of December 2015.

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