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Mideast gas demand set to accelerate

By Tom Nicholls

Gas utilisation in the Middle East and North Africa (Mena) region will grow at 9-10% a year for the next two or three years as governments switch their industries from oil to cheaper gas, according to a fast-growing regional energy supplier.

And, says Khaled AbuBakr, managing director of Egypt's Taqa Arabia, growth could accelerate even faster if governments decide to speed up programmes to phase out subsidies.

There are signs that may happen, he said: removing subsidies is an increasingly attractive option for cash-strapped governments with other spending obligations. It would also encourage greater investment upstream, and in badly needed transmission and distribution infrastructure.

And with production increases appearing insufficient to match projected long-term demand growth, the authorities are under pressure to allow gas prices to rise to commercial levels.

Taqa Arabia's main operations are in Egypt where it supplies gas and power, and oil products. It is also active in the UAE, Qatar, Libya and Sudan, and is targeting other Mena markets.

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