CAIRO, Apr 12 (Aswat Masriya) – Saudi oil company Aramco and Egypt’s SUMED agreed to increase the former's oil pumping to its customers in Europe via SUMED’s pipeline, said Egypt's oil minister on Tuesday.
During the Saudi king’s visit to Egypt, which began last week and ended on Monday, Aramco signed a memorandum of understanding with SUMED as part of the agreements signed between Egypt and Saudi Arabia.
Oil Minister Tarek al-Malla said in a statement that the agreement with the Saudi side entails studying the possibility of Aramco using SUMED’s storage facilities to store Saudi petrol.
Earlier this month, Egypt signed a deal with Aramco stipulating that the Saudi company would supply Egypt with petroleum products for five years.
The Egyptian General Petroleum Corporation (EGPC) owns 50 per cent of SUMED that owns and operates Sidi Krir port on the Mediterranean coast. The remaining 50 per cent are owned by four Gulf countries: Saudi Arabia, Kuwait, UAE and Qatar.
The SUMED pipeline is 320 kilometers long and runs from the red sea to the Sidi Krir port, west of Alexandria, on the Mediterranean.
Malla said the ministry is implementing several projects to secure the supply of petroleum products and natural gas to Egypt, including building storage facilities in Ain al-Sokhna for the trading of butane gas and fuel, and establishing a maritime quay to receive Liquefied Natural Gas (LNG) carriers.
Last December, Saudi Arabia said it will raise its investments in Egypt to above 30 billion Saudi riyals ($8 billion) and pledged to contribute to providing Egypt with its petroleum needs for the next five years.
The Saudi decision came one day after Saudi Arabia launched an "Islamic alliance" made up of 34 countries, including Egypt, to fight terrorism.
Saudi Arabia and Gulf neighbours Kuwait and the United Arab Emirates have backed Egypt since the military ouster of former president Mohammed Mursi in July 2013 following mass protests against his rule.
The kingdom has been generous with Egypt, a net importer of energy, since mid-2013 but the financial assistance now comes at a time when Egypt’s cash-strapped economy is in dire need.
Years of political turmoil have taken a toll on the Egyptian economy, halving the state’s foreign reserves and driving away tourists, contributing to a dollar shortage.