Egypt Seals $10bn BP Natural Gas Deal

Egypt has finalised a $10bn deal with BP that could significantly boost the country's natural gas production.

The gas project had stalled for three years in the face of political, social and economic turmoil in the Arab world's most populous country but Egypt's prime minister has announced completion of the deal according to Egyptian media outlet Ahram Online.

The BP-discovered fields are thought to hold around 5 trillion cubic feet of gas and could potentially produce 1.2 million cubic feet per day.

That would amount to roughly 20% of Egypt's daily gas needs, although consumption is forecast to rise to12.5% in the current fiscal year.

The fields, located in the Alexandria governorate, are set to be connected to the national grid in 2017.

The move is likely to boost investor confidence in Egypt which has suffered from foreign capital flight and energy shortages since 2011.

The country's new President Abdel Fattah al-Sisi has launched a bid to tackle the country's energy crisis, by reducing government fuel subsidies and encouraging Egyptians to reduce personal consumption.

Energy prices in Egypt have been among the lowest in the world for years. While successive administrations have pledged to tackle the fiscal challenge, Sisi is the first leader in decades to push ahead with major public finance reforms.