INTERCONSULT OICE Antenna in Tel.: 202-7489810 Fax:202-7603136 email: [email protected]

News Letter of October 2006

4 new grant agreements to be soon signed with the EU worth Euro 129 million. 4 new grant agreements are to be soon signed with the EU worth Euro 129 million. They include Euro 88 million to support the Heath Care Sector, Euro 20 million to consolidate resources of the Social Fund for Development and Euro 11 million to support Scientific Research and Development Program, apart from Euro 10 million to enable subsidize interest on credits to finance industrial waste treatment projects at eligible small to medium size factories.

A tender to be released by ENR – Egyptian National Railways Authority in two months to procure & overhaul locomotives, also to revamp signals electrification. According to Egypt Minister of Transport, Eng. Mohamed Mansour, a tender to be released by ENR – Egyptian National Railways Authority in two months to procure & overhaul locomotives, also to revamp signals electrification. It provides for the purchase of 65 brand new locomotives, for the rehabilitation of other 200 locomotives & for the revamping of signals. Meanwhile ENR workshops are being developed & upgraded, also linked together via an information network.

$ 37.5 million project announced for two electric links of Jerico & Ghaza Cities in Palestine with the Jordanian & the Egyptian power grids. $ 37.5 million project was recently announced for two electric links of Jerico & Ghaza Cities in Palestine with the Jordanian & the Egyptian power grids respectively. Finance for the project has been so far raised by the Jeddah based IDB – Islamic Development Bank ($10 million), by Al Aqsa Mosque Fund ($10 million) & by the SDF – Saudi Development Fund ($5 million). N.B. Project is crucial for both cities considering the severe shortage of electricity supply therein.

A project to produce gas liquids at Gulf Zone seems in the pipeline promoted by 50/ 50 joint venture between Dana Gas Al Bahrain Co. and Cairo based E Gas (Holding Co. for Natural Gas). A project to produce gas liquids at Suez Gulf Zone seems in the pipeline promoted by 50/ 50 joint venture between Dana Gas Al Bahrain and Cairo based E Gas (Holding Co. for Natural Gas). Worth indicating is that Dana Gas Al Bahrain is 66 % owned to Sharja based Dana gas of the UAE with the remaining 34 % held by Bahraini investors. The project will depend on the so-called gas-to-liquids technology, deemed an advanced technology in the industry. No mention was given to values or to estimated investments.

1/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected]

More details released on the $ 745 million project for the extraction & processing of salt & minerals from Qaroun Lake in El Fayyoum promoted by an affiliate to Al Kharafi Group of . More details were recently released on the $ 745 million project for the extraction & processing of salt & minerals from Qaroun Lake in El Fayyoum promoted by an affiliate to Al Kharafi Group of Kuwait. The project targets to stop converting the lake into a Dead Sea by 2010. A hearing session, held recently by the project owner & attended by leading university professors for science & experts in environment, concluded the scheme would help the country stop completely any minerals & salts imports & turn into an exporter thereof. Project, to be executed over 3 stages, would generate 5,000 employment opportunities & $ 250 million annual exports, apart from the reduction of salt & minerals concentration in the Lake water to their normal levels. It would further enable the reclamation of lands surrounding the lake. An almost half page full reportage on the scheme, published in the media, is deemed a useful piece of market literature to concerned parties & businesses. N.B. Earlier media reports indicated that Al Kharafi Group has also plans for a mega tourist development project in Fayyoum.

$ 1 billion refinery project in Ein Al Sukhna promoted by Al Kharafi Group to have a daily capacity to handle 150,000 barrels of heavy crude oil. $ 1 billion refinery project in Ein Al Sukhna is now promoted by Al Kharafi Group to have a daily capacity to handle 150,000 barrels of heavy crude oil. The Group has already submitted a complete project feasibility study to the EGPC – Egyptian General Petroleum Corporation. Project will mainly depend on local heavy crude supplies, also on supplies via Sumed pipeline.

Award of the solar component package of Al Kureimat thermal solar power station of 150 MW capacity to be announced next month. According to Egypt Minister of Electricity & Energy, Dr. Eng. Hassan Younis, award of the solar component package of Al Kureimat thermal solar power station of 150 MW capacity is to be announced next month. Project goes under partial finance of $ 97 million from Japan and $ 50 million from the World Environment Fund. Project is scheduled for completion by 2009. It is deemed the first in kind in Egypt and The Middle East.

Indorama Egypt for Petrochemicals affiliated to Indorama of India applying for a project license to produce ammonia under $ 200 million estimated investments. Media reports revealed that Executives of Governorate & of Port Said Port Authority have reviewed with the Chairman of Indorama Egypt, affiliated to Indorama Group of India, a project to produce anhydrous liquid ammonia at East Port Said Port

2/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected] under $ 200 million estimated investments. Project would have a 1,600 tons/ day design capacity & would generate annual exports worth $ 125 million. It requires 200,000 M2 land. Scheme also requires 10 MW/ II kV electricity & 750 M3/ hour soft water. Scheme would further require a special dock at the port.

A work team formed at the Ministry of Civil Aviation to evaluate techno- economical feasibility of a new airport project in Sohag. A work team was recently formed at the Ministry of Civil Aviation to evaluate techno- economical feasibility of a new airport project in Sohag. Development followed earlier directives of President Moubarak to build the airport to enhance development & investment in the Governorate, also improve its links with other governorates. According to Eng. Ibrahim Mannaa, Chairman of the Holding Co. for Airports & Air Navigation, the project will be located 15 Km to the south west of Sohag City & will assure future expansion options. It would comprise departure & arrival halls for international lines, a hall for domestic flights, a 3 Km long 60 meters wide runway, an aeronautic control tower & a park for 3 airplanes, No mention was given to involved investments. N.B. Development follows earlier announced decision to link Sohag with the via a 220 Km long highway financed from receipts of the fees for the third mobile telephone license.

Seven international companies from Germany, Denmark, France & China invited to bid for a second production line at Misr Cement Co. Qena SAE to produce 1.4 million tons/ year of cement/ clinker. Seven international companies from Germany, Denmark, France & China invited to bid for a second production line at Misr Cement Co. Qena SAE to produce 1.4 million tons/ year of cement/ clinker. That was announced by the Company Chairman, Eng. Mohamed Mahmoud Ali Hassan, indicating that bids opening session for the $ 100 million project would take place in January 2007 & that the project is scheduled for completion in 15 months. Output is projected for export to Europe via Safaga Port after equipping it with a special dock. Eng. Hassan has revealed that the company has exported during the first 9 months of 2006 some 537,000 tons of bagged cement effected mainly to Sudan & other Red Sea Basin Countries, also to Syria, at prices averaging the equivalent of L.E. 400/ ton.

46 new petroleum wells to be drilled countrywide over the next stage under 12 petroleum concessions and natural gas, via pipelines, to reach Asswan by 2010. Egypt Minister of Petroleum & Minerals, Eng. Sameh Fahmy, announced that 46 new petroleum wells are to be drilled countrywide over the next stage under 12 petroleum concessions & that natural gas, via pipelines, would reach Asswan by 2010. Wells are located on Egypt boarders with Sudan & Libya, also in the Red Sea Zone, the Eastern & the Western Desert. The Minister has indicated that 7 of the said concessions were already signed & the remaining 5 are still to be signed with the Southern Valley Petroleum Holding Co. As regards natural gas, the Minister has assured that works

3/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected] have started on its pumping southwards over several stages. That involves a 145 Km long pipeline from Beni Swef to Minya and a 116 Km long pipeline from Minya to Assuit. Meanwhile natural gas pipelines are now also extended to Taba & Sharm El Sheikh in Southern Sinai.

After 6 months of suspension, works resumed on the L.E. 150 million roads construction project to complete Mansoura/ Gamassa link to the International Northern Coast Road. After 6 months of suspension, works resumed on the L.E. 150 million roads construction project to complete Mansoura/ Gamassa link to the International Northern Coast Road. Project provides for the double tracking of a 35 Km long section of the said link (between Gamassa & Ammar Bridge), the construction of a double track road between Mansoura main bridge & Ammar bridge, also the construction of 3 overhead bridges across a subsidiary canal. The scheme saves 14 Km & 25 minutes traveling time to go from Mansoura to Gamassa in less than 35 minutes instead of more than an hour before, going along Talkha/ Batra/ Basandila/ Ammar Road. N.B. Main Contractor is the Egyptian Contracting Co. – Mokhtar Ibrahim.

Two to four 66/ 11 kV transformers stations to be built within Greater Cairo till 2017 to assure smooth electricity supply to 6.5 million subscribers. Two to four 66/ 11 kV transformers stations would be built within Greater Cairo till 2017 to assure smooth electricity supply to 6.5 million subscribers. That was part of a study conducted by EEHC – Egyptian Electricity Holding Co. predicting two such stations would be annually required during the years 2007 to 2012, to be increased to 4 stations annually for the years 2013 to 2017. Study was prepared in coordination with EETC – Egyptian Electricity Transmission Co., also with Cairo North & Cairo South Electricity Distribution Companies (also with EPS). N.B. Development sends utmost promising news to a long list of transformers suppliers and integrators including ELMACO, EGYMAC, Schneider, Siemens, Hidelco, Kahromica, also to related feeder industries including Al Sewedy (Arab Cables), Giza Cables & the Egyptian Electro Cables, a.o.

3 new projects capitalized at $ 14 million licensed recently at Port Said Public Free Zone to produce ready made garments exclusively for export. 3 new projects capitalized at $ 14 million were recently licensed recently at Port Said Public Free Zone to produce ready made garments exclusively for export. That was announced by Mr. Atef Al Ghatawi, head of the Free Zone Executive Agency, indicating that the projects would generate about 650 new employment opportunities and contribute in increasing annual exports abroad by about $ 65 million.

4/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected]

Exxon Mobil Egypt announcing expansion plans over the next 3 years to go under $ 100 million estimated investments. Exon Mobil Egypt has announced expansion plans over the next 3 years to go under $ 100 million estimated investments. Plans provide for the extension of the company vehicles fuelling & service stations of pretty high technical & technological level including its involvement with natural gas fuelling, also with catering activities via its On the Run department stores annexed to the stations. That was announced by Eng. Sameh Fahmy, Egypt Minister of Petroleum & Minerals, following his recent meeting with the company President. $ 70 million of the said figure are allocated for outlets within Greater Cairo, with the remaining $ 30 million are allocated for outlets in Alexandria & Lower Egypt Governorates. Plans would generate 1,400 direct employment opportunities.

10 grant agreements signed recently under the US AID program valued $ 405 million. 10 grant agreements were signed recently under the US AID program valued $ 405 million. Mrs. Fayza Abul Naga, Minister of State for International Cooperation, who signed the agreements on the Egyptian side, said they included $ 197.4 million for the CIB – Commodity Imports Program, $ 84.7 million for basic education, $ 60.5 million for potable water & wastewater projects ( mainly in Alexandria & Northern Upper Egypt) & $ 24.7 million for health care & family planning among others.

Euro 40 million loans endorsed by Finland to back different development projects in Egypt. Euro 40 million loans were endorsed by Finland to back different development projects in Egypt. An agreement on the above was recently signed in Cairo. According to Mrs. Fayza Abul Naga, Minister of State for International Cooperation, the loans, for repayment over 10 years at no interest, will be allocated to finance projects related to environment, health care & industry. Meanwhile the Minister has announced that a joint Egyptian Finnish Businessmen Council in now under formation.

Suez Canal tolls projected to hit a $ 3.65 billion record level by the end of 2006, of which $ 960 million targeted during the third quarter. tolls are projected to hit a $ 3.65 billion record level by the end of 2006, of which $ 960 million targeted during the third quarter. Figures were released by Gen. Ahmed Ali Fadel, Chairman of SCA – , indicating that tolls for the third quarter of 2006 exceeded the previous quarter tolls record of $ 940 million achieved during the second quarter of 2005. Other records are also projected in the number of crossing vessels & in their total tonnage.

5/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected]

Canada is offering to cooperate with E.N.R. – Egyptian National Railways Authority regarding different projects and supplies. Canada is offering to cooperate with E.N.R. – Egyptian National Railways Authority regarding different projects and supplies. That was announced by the Canadian Ambassador to Cairo indicating that cooperation may extend to relevant technology transfer, particularly related to electronic railways signaling, the revamping of railway tracks and the supply/ rehabilitation of locomotives. In May last 2006 E.N.R. has released an international tender for the supply of spare parts required for the overhauling and rehabilitation of 60 Canadian locomotives.

A $ 30 million plan endorsed by the Prime Minister Dr. Ahmed Nazif to improve security aspects at historic and tourist locations in Luxor City and assure more efforts to encounter possible terror acts. A $ 30 million plan endorsed by the Prime Minister Dr. Ahmed Nazif to improve security aspects at historic and tourist locations in Luxor City and assure more efforts to encounter possible terror acts. That was announced by Dr. Samir Farag, Luxor City Mayor, indicating that the project is backed by a grant from a Donor Country and that plan details are now being put by the Ministry of Interior and other concerned security agencies.

6 new projects licensed at Alexandria Public Free Zone Complex capitalized at $ 4.25 million on 23,500 M2 land. 6 new projects licensed at Alexandria Public Free Zone Complex capitalized at $ 4.25 million on 23,500 M2 land. That was announced by Alexandria Governor, indicating that projects involve $ 5.25 million estimated investments and would generate 158 employment opportunities. Projects would involve with textile & garments production, also with extending services to petroleum companies.

Two oil concession agreements signed with British and Australian companies for petroleum exploration and exploitation in the eastern desert and in Komombo [in the Southern Valley] under $ 30.1 million committed investments and signature bonus. Two oil concession agreements signed with British & Australian companies for petroleum exploration and exploitation in the Eastern Desert and in Komombo [in the Southern Valley] under $ 30.1 million committed investments and signature bonus. The first was signed with Aminex Petroleum Egypt of the UK covering 1,328 Km2 in the Eastern Desert and the second was signed with Pan Pacific Petroleum Egypt of Australia covering 42,291 Km2 area in Komombo, in the Southern Valley.

Port Said Port Authority announcing its initial approval to allocate 1 million M2 area at East Port Said Port to Aayan Group of Kuwait to extend maritime transport services under $ 250 to 300 million estimated investments:

6/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected]

Port Said Port Authority has announced its initial approval to allocate 1 million M2 area at East Port Said Port to Aayan Group of Kuwait to extend maritime transport services under $ 250 to $ 300 million estimated investments. Consultant of the Group, Dr. Eng. Ahmed Helmi, said a new company would be formed to manage the project capitalized at $ 40 million, 92 % of which owned by the Kuwaiti party. He further indicated that detailed project studies are now being prepared.

$ 120 million project announced for the processing of raw black sand in Al Borollos in Kafr El Sheikh Governorate. $ 120 million project was announced for the processing of raw black sand in Al Borollos, in Kafr El Sheikh Governorate. Relevant project studies are prepared by Roch Co. of Australia and are scheduled for completion by the end of 2006 under $ 3.5 million contract. The project, scheduled to start production in 2 years thereafter, will produce among others, the zircon material deemed the major feedstock for the production of ceramic tiles [ representing 16 to 20 % of its cost]. Project is sponsored by the Ministry of Electricity and Energy. Worth indicating is that Egypt disposes on huge reserves of black sand along Delta Coasts and North Sinai. N.B. Above is the third large sized mining and metallurgy project announced over the past few years after the tantalum recovery project and Gabal Al Sokkari gold recovery project.

Works seems progressing on the new $ 550 million Egyptian museum project in Giza, now scheduled for completion by early 2011. Works seems progressing on the new $ 550 million Egyptian museum project in Giza, now scheduled for completion by early 2011. That was announced by Dr. Farouk Hosni, Minister of Culture, indicating that works would soon start on the project second phase involving the power station, the International Center building for Antiquities Renovation and a large sized fire fighting facility. On his side First Undersecretary of the Ministry, Mr. Farouk Abdel Salam, announced that 16 companies and consortia are competing for the project third phase involving the museum main building.

An international consortium grouping French companies, ARABCO and Orascom Construction Industries, of Egypt, declared lowest bidder for both the construction and the electromechanical packages pertaining to phase 1 of Cairo third metro line. An international consortium grouping French companies, ARABCO and Orascom Construction Industries, of Egypt, declared lowest bidder for both the construction and the electromechanical packages pertaining to phase 1 of Cairo third metro line. Final results will be announced later. Media reports indicated that final official results of offer evaluation would be announced later on.

7/8 INTERCONSULT OICE Antenna in Egypt Tel.: 202-7489810 Fax:202-7603136 email: [email protected]

E.N.R. – Egyptian National Railway Authority to soon sign a $ 25 million contract with General Motors of the US to supply spare parts for the rehabilitation of 60 GM locomotives. E.N.R. – Egyptian National Railway Authority to soon sign a $ 25 million contract with General Motors of the US to supply spare parts for the rehabilitation of 60 GM locomotives. Contract is backed by a part of a $ 57 million loan extended earlier by KFESD – Kuwaiti Fund for Economic & Social Development allocated to revamp E.N.R. – Egyptian National Railway Authority.

Media reports indicating that a group of Kuwaiti investors has expressed interest to implement a $ 1 billion petrochemicals complex in Suez City. Media reports have indicated that a group of Kuwaiti investors has expressed interest to implement a $ 1 billion petrochemicals complex in Suez City to produce fuel oil, benzene & jet fuel. The group intends to use a land lot owned by Suez Co. for Petroleum Refining to build the complex thereon. Informed sources quoted in the media said the project is now evaluated by EGPC – Egyptian General Petroleum Corp., under possible contribution of the Egyptian Petroleum Sector. Reports indicated that the same Kuwaiti Group has earlier applied, in cooperation with a Saudi group, to implement the same project yet studies showed it was not feasible which drove the Saudi group to withdraw. Still the Kuwaiti Group has contracted another consulting house to reevaluate project feasibility, which prove positive after pressing down some investments.

Under the initiative of PPP – Public Private Partnership, the Ministry of Finance to soon release a tender for the construction of 50 schools, to be executed by the private sector. Under the initiative of PPP – Public Private Partnership, the Ministry of Finance to soon release a tender for the construction of 50 schools, to be executed by the private sector. According to Egypt Minister of Finance, Dr. Yousef Botros Ghali, a Central Unit was formed at the Ministry under participation of executives of the Ministry of Investment to coordinate projects submitted by the other ministries to be executed under the said initiative. The Minister has further indicated that contracts concluded between the Government & the private sector would be of long term & of international standards & provisions. Here the Government intends to make use of experiences of other countries accumulated in that direction including those of Greece, the UK & South Africa. A week earlier the Minister has issued a decree amending the executive regulations of the tenders & auctions law to tolerate activating the initiative. On its side GAEB – General Authority for Education Buildings, has already completed the preparation of 300 sites to build schools thereon under the PPP initiative spread countrywide.

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