Italian utility Enel and the Egyptian Natural Gas Holding Company (EGAS) have laid the foundations for a long-term strategic alliance that is intended to give each of the two companies access to opportunities in the other's markets.
Their co-operation agreement covers the natural gas and the power generation sectors. The deal will help to consolidate Enel’s position as a vertically integrated energy company and secure natural gas supplies for its Italian operations.
“This agreement … will allow Enel’s entry in one of the most important gas producing countries, and shall support Enel’s strategy of diversification of energy sources and vertical integration, from the gas production down to the power generation and distribution and sale of electricity and natural gas to final customers,” said Enel CEO Fulvio Conti.
Under the deal, EGAS will gain access to markets where Enel is already active to jointly market natural gas. In return, Enel will make direct equity investments in Egyptian natural gas assets, including a liquefaction plant and gas fields.
Italian energy major Eni has also furthered its activities in Egypt, signing a memorandum of understanding with the Egyptian Electricity Holding Company to investigate the feasibility of converting power stations in the country to combined cycle in order to enhance efficiency and save natural gas.
Eni is the main foreign oil and gas player in Egypt where its equity production of oil and natural gas reached 240 000 boe/d in 2007.
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