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Damietta LNG plant to restart by June: Eni
Damietta LNG export plant, idled since November 2012, will restart by June of this year.
Eni announced that Damietta LNG export plant, idled since November 2012, will restart by June of this year, after an amicable resolution to an eight-year dispute between investors (Eni and Naturgy) and the Egyptian government.
The Italian operator has said that it settled disputes between Union Fenosa Gas (UFG) and Segas with EGAS and Egypt, although it didn’t say if the government will pay the arbitration claim previously awarded to Naturgy.
Under a new deal, Naturgy will leave the JV and the participation of UFG in the Damietta plant (80%) will be transferred to Eni (50%) and to EGAS (30%) so the shareholders in Segas include Eni 50%, EGAS 40% and EGPC 10%.
Eni will also take over the contract for the purchase of natural gas for the plant and will receive corresponding liquefaction rights, thus increasing the volumes of LNG in its portfolio by 3.78 BCM/Y, which will be available on an FOB basis, with no destination restrictions.
Naturgy said that as part of the agreements, it will receive $600 million in cash and most of the UFG’s assets outside Egypt. Commercial activities in Spain will now be owned by Eni. It will have no obligation in the future to buy LNG from Egypt, which the company sees as an important step to gradually reduce its exposure to gas procurement contracts. It also solves a complex situation which had lingered since 2012, consuming significant time and resources.
“We are simplifying Naturgy’s geographical presence to focus on those areas that maximize the creation of long-term value of our main businesses with the company’s stakeholders in mind,” commented the Spanish company’s CEO Francisco Reynes.


Source(s) GLNGI Staff, Eni, Naturgy, Reuters