Egypt to pay off $6 billion in arrears to foreign oil firms by 2017

The Egyptian government has reached an agreement with foreign oil firms to pay off all of its arrears by 2017 instead of its previous plan to pay LE21 billion ($3 billion) out of a total of LE42 billion ($6 billion) by that time, a source familiar with the matter told Ahram Online.

The source added that the ministry of petroleum plans to pay LE10.5 ($1.5 billion) by this September to companies including BG group and British Petroleum.

Egypt's debt to foreign oil companies decreased to LE41.3 ($5.9 billion) in June from LE42.7 ($6.1) billion the prior month; Tarek Al-Molla, the head of Egyptian General Petroleum Corp (EGPC), told Reuters on Monday.

The decrease was merely LE1.4 billion ($200 million) despite the payment of LE10.5 billion ($1.5 billion) at the end of last year.

But as foreign oil firms increase their investments and explorations in Egypt; their entitlements in the Egyptian government rise, said the source.