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UFG claims guarantees are not sufficient to restart Egyptian LNG facility

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According to Reuters, Union Fenosa Gas (UFG) has announced that it has not received sufficient guarantees regarding a US$2 billion payment in on-going discussions with Egypt to restart an LNG plant.

Reportedly, UFG claims that Egypt was restricting supplies in 2013 to the Damietta plant, instead opting to divert its export supplies to its domestic market. Reuters reports that the facility has been idle ever since.

In September last year, the UFG reportedly said that it was holding talks with Egypt to restart the facility as soon as possible, in an emailed reply to Reuters over US$ billion a World Bank arbitration body ordered the country to pay the company.

According to Reuters, the country said that it was taking all of the required steps regarding the money it was ordered to pay to UFG because of the lack of gas supply to the plant. It did not elaborate on what these steps are.

Reuters quote UFG as saying: “Progress has been made but the guarantees offered are not sufficient to reach the comprehensive agreement required to bring the dispute to its end.” The company added that discussions are still underway.

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