Session timeout

Sorry, your session timed out after a long time of inactivity. Please click OK and Sign In again.


Interview: Waleed Abouraya, President, RGS Egypt Limited (Egypt)

Egypt’s government has suggested that Egypt’s coal imports could reach 30mt. Waleed Abouraya, President, RGS Egypt Limited talks to us about the feasibility of this and also reveals what he is most looking forward to hearing about at The World Coal Leaders Network.

In April last year, Egypt’s government announced that private companies can begin to import coal to Egypt subject to environmental regulations. How much coal has Egypt imported since and from where?

The government started to allow cement plants to use solid fuels in April last year and since then about 1.5 million Mt has been imported, which was mainly steam coal and petcoke. Steam coal was much greater in quantity and was mainly coming from South Africa, Ukraine, Russia, and one cargo from Colombia. As for petcoke, Lafarge Egypt has been the only one using 100% petcoke so far. They got a contract with the local refinery Midor to take 100% of their production for one year, which is around 300-350 Kt, but Sulphur was high so they had to import few lower sulphur cargoes mainly from the US Gulf and Venezuela. Now Cemex Egypt is also about to start using petcoke and they just received their first petcoke shipment from USA Pascagula refinery.

Egypt’s government has suggested that Egypt’s coal imports could reach 30mt. In what timeframe do you think this is realistically feasible and how much investment and infrastructure development is required to achieve it?

Egypt has about 60 million Mt of cement production, which will be increased in the next few years to reach 80 million Mt. The current cement production would need about 7-8 Million Mt of solid fuels. However, there are plans to build coal fired power plants to cover the power shortage, and the plan is to add about 18-22 GW of power from those plants by year 2027. You need about 2-2.5 million Mt of produce 1 Gigawatts of power, so in this case we will need about 40-50 Million Mt of solid fuels only for power generation. Power plants will have their own ports to receive the fuels, while cement plants will struggle with ports congestion until new terminals are built to absorb the additional demand of about 8 million Mt of bulk fuels.

In light of Egypt’s new environmental regulations, is petcoke still an attractive ingredient for the country’s cement manufacturers or is coal generally preferable? What factors affect buyers’ choices in buying petcoke vs coal?

In fact, petcoke will always continue to be a great choice due to its higher calorific value versus coal. The problem with petcoke is the high sulphur content. This causes a problem in cement kilns as the sulphur content melts at the beginning of the kiln and then solidifies when cooled, so it stays on the lining of the kiln. However, there is a technical solution to get the best use of petcoke and you can see that Lafarge and Cemex are using almost 100% petcoke in all of their plants around the world. In Egypt, all cement plants will have to build new systems to burn solid fuels, so when they start this new system they will need to minimise technical problems. In this case steam coal is the answer, as it has a much lower sulphur content. They will start using steam coal until production is stabilized and then they will start blending with petcoke.

What opportunities are there for development of Egypt’s coal fired power generation and are there any projects in the line-up?

In addition to the projects mentioned above, there are currently 4 potential coal-fired power plants under firm discussions and they are now working with the government to allocate the land.

Are there any other industries besides cement and power that may start using solid fuels?

Yes, the brick industry; All brick producers in Egypt had to rely on natural gas and fuel oil in the past and due to the big shortage of each of these, we expect to see the government allowing brick producers to use solid fuels. If all brick producers convert to using solid fuels, we would expect that there would be an additional requirement of about 2.5 - 3 million Mt of solid fuels only for brick producers.

Which question or industry issue are you most interested to hear discussed at this year’s conference in Barcelona?

The million dollar question is, what impacts prices of steam coal of different origins? For example, sometimes we see South African prices are higher than Colombian and sometimes less. Likewise, Russian prices can be very competitive and sometimes they are out of competition.

You can hear more from Waleed at The World Coal Leaders Network in Barcelona on 18 - 20 October where he will be holding a roundtable discussion on 'How quickly can Egypt reach 60mt of solid fuel imports for its cement and power industry?'

This content is provided by Coaltrans Conferences for informational purposes only, and it reflects the market and industry conditions and presenter’s opinions and affiliations available at the time of the presentation.

Related Insights