Egypt repays BG debt

BG Group has received another $350 million (£290.4 million) from the Egyptian government to cover part of the country’s huge debts to the energy industry. It's welcome news, but BG is owed much more and the Egyptians are in no hurry to pay it back.

An initial tranche of $350 million was received by BG in October. But even after this latest payment, the company's domestic receivables balance in Egypt still sits at around $920 million.

In January 2014, BG issued Force Majeure notices under its LNG agreements in Egypt as gas volumes diverted to the domestic market there meant it was unable to meet in full its obligations to deliver gas to LNG producer Egyptian LNG.

Egypt is in the midst of an energy crisis. A rapidly rising population, intense heat and terror attacks on infrastructure mean domestic demand now seriously exceeds capacity. It's now a net importer of energy and blackouts continue to hurt the local economy.

"While the group has been impacted by the reduction of LNG exports from Egypt, the company continues to investigate options for increasing the supply of gas and is working with the government on resolving the outstanding receivable balance," said BG on Friday, repeating an earlier statement in October.

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