Saad Eldin Group. The highly diversified vertically integrated Oil & Gas holding was founded in 1985 and is focused on servicing LPG, LNG, CNG and other industrial gases. Saad Eldin Group subsidiaries and factories are dedicated to manufacturing, filling and delivering of gas cylinders throughout Egypt. Its facilities include gas processing plants, LPG container manufacturing facilities, and gas storage terminals.
As a private sector businessman, how do you evaluate Egypt’s economy?
Security has brought stability. GDP growth has increased from 2.3% in 2013 to 5.4% in 2018. Net international foreign exchange reserves in Egypt have increased from USD 12 billion in 2013 to USD 44.5 billion in 2018 at the Central Bank. We see tourism and foreign direct investment returning and are optimistic of growth prospects in the market.
In addition, the government is continuously working to facilitate private sector investments. They have updated Egypt’s legal framework through the new investment law, and manpower legislation has been enhanced. We see massive improvements in national infrastructure through the extensive network of newly built roads, the Suez Canal expansion, and new electric power stations. Government is strategically building key national infrastructure with Egypt’s long term growth prospects in mind. New infrastructure is able to exceed current needs allowing for export and will cover much larger national needs in the future if needed. This all indicates that Egypt is on track.
How do you assess Egypt’s natural gas reserves and energy hub strategy?
Historically Egypt has been an excellent partner exporting gas via pipelines to the region since 1999. Egypt constructed many pipelines and two liquefaction plants on the North coast for this purpose. Although they have been underutilized for years, Zohr’s increasing national gas production levels will capitalize on this pre-existing infrastructure. Liquefaction plants, for example, can take five years to construct and cost USD 10 billion. We already have these facilities to receive production from neighboring countries and export to Europe for example.
How is Saad Eldin Group capitalizing on new natural gas production in Egypt?
Egypt is floating on a sea of gas. Egypt has enormous high-quality gas reserves which will bring affordable energy to the market. However, building pipelines is extremely costly, and one of the biggest challenges within the Egyptian market has been the transportation of this gas to clients. Saad Eldin Group’s subsidiary Gastone, signed a protocol with the government allowing the transport of all gases nationally via gas cylinders to final consumers. Our subsidiary Gastone specializes on the transfer and delivery of liquified gas between ports, the groups production sites and end consumers. We efficiently supply industry, end users and have large plans to grow.
For example, the government aims to convert diesel cars to run on nationally produced natural gas and bring natural gas to every home. At the beginning of 2019, Egypt will start placing trailers to deliver 250bar Compressed Natural Gas (CNG) Cylinders in petrol stations to meet local needs. This government strategy will reduce Egypt’s demand for diesel which consumes much needed foreign exchange reserves when imported. The move will also improve Egypt’s budget deficit and strengthen national economics.
The move is a business opportunity. It will increase the use of cylinders and requires strategic transport, delivery, and logistics operations. This is an opportunity for Saad Eldin Group to help the government achieve its goals while growing our business. Saad Eldin Group has brought leading technologies to Egypt to CNG bar requirements, and we are using our expertise to meet local demand.
Do you see opportunities to develop Egypt’s renewable energy sector?
Egypt has excellent locations to produce solar and wind energy. We have fantastic weather allowing for 6-8 hours of direct sunlight per day and extensive land in the desert which is ideal for large solar projects. The Benben SolarPark project in Aswan is an excellent example of this potential. It aspires to provide 2GW of solar power by 2020 which means almost 20% of Egypt’s power has the potential to come from a renewable energy source very soon. The government is facilitating the use of renewable energy and promoting it in homes throughout Egypt. Egypt has many opportunities to develop renewable energy projects, and Saad Eldin Group is positioning itself to improve the sector further.