Egypt to Reactivate Business Relations with Saudi Arabia

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Researched by Industrial Info Resources (Sugar Land, Texas)--Egypt and Saudi Arabia have a long history of economic cooperation that is based on a high level of trade exchange between the two countries, which amounted to $3.4 billion in 2010. Strong Saudi investments in Egypt, which total more than $10 billion, are concentrated mainly in the oil, agriculture, tourism and real estate sectors.

In 2004, Saudi Egyptian Petrochemical Company (Sepco) constructed what is said to be the largest polyester complex in the Middle East. The plant is in Alexandria, Egypt, and is capable of producing 100,000 tons per year of partially oriented yarn and textile chips; 50,000 tons per year of staple fibers; and 150,000 tons per year of polyester resin. When the project was first announced in 2000, the estimated cost was $650 million.

In mid-2010, Egypt and Saudi launched a $1.5 billion, 3,000-megawatt (MW) grid interconnection project to exchange electrical power between the two countries, via a 500-kilovolt, high-voltage direct-current transmission line, with 1,300 kilometers onshore and 35 kilometers offshore. Project activities were put on hold after the Egyptian revolution that began on January 25, but they have been reactivated following an announcement by the Egyptian Ministry of Electricity this week that a project bid will be floated globally in April 2011.

For his part, Dr. Hassan Yunis, the Egyptian Minister of Electricity and Energy, said that it was agreed that each country will finance, operate and maintain the interconnection line, associated equipment and accessories that are on its land. Yunis added that in regard to the offshore facilities, the responsibility of financing, ownership, operation and maintenance will be shared equally between the two countries. Implementation of the project is planned to begin in January 2012, and the operating test procedures will begin in the first quarter of 2015.

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