WORLD NGV2002 CONFERENCENGVs: Clean Transportation for a Livable World
Washington, D.C.(October 8-10, 2002)
““EgyptEgypt’’s Clean Fuel Initiatives Clean Fuel Initiative””by
Frank ChapelManaging Director - Natural Gas Vehicles Co. (NGVC) &
VNG Project Manager - BP Egypt
Greater Cairo Air Quality Concerns
1992 World Bank study
-- TSP 8 times WHO standard
1993 EEAA study
-- transport sector major air polluter
1999 study quantifies health cost
-- $U.S. 1 - 2 billion per year(3% to 6% Egypt GDP)
Why CNG?
Natural gas as a transportation fuel could help address these severe airpollution problems.CNG would provide a new transportation fuels customer segment forEgypt’s abundant natural gas supply.Commercialization of CNG would create many new job opportunities.
Egypt CNG Pilot Projects
Two Pilot ProjectsGUPCO-- 3 Stations, 150 VehiclesPetrobel (IEOC)
-- 2 Stations, 30 IVECO Buses
Major Project Objectives
Ensure that natural gas performed
Evaluate reliability of equipment
CommercializationNatural Gas Vehicles Company (NGVC)
In December, 1994, a M.O.U was signed to begin CNG commercialization. The partnersdesignated for this new venture are BP Egypt (40%), Egypt Gas (40%) and ENPPI (20%).
In September, 1995, this joint venture was incorporated as the Natural Gas Vehicles Company(NGVC).
“Chicken and Egg” Dilemma
• NGVC’s and E.I.G. TEC’s corporate objectives are to (1) construct and operateCNG fueling stations and (2) construct and operate vehicle conversion centers.
• These objectives also promote more efficient and customer focused marketdevelopment.
Egypt Market Dynamics
62 CNG fast-fill fueling stations29 vehicle conversion centersOver 40,000 vehicles now powered by CNGEgypt # 8 out of 55 countries now promoting CNGEmployment created exceeds 800 workersShell Egypt CNG approved in March, 2002 as third CNG company
Customer Economics
• CNG is priced less than half that of gasoline.• The typical CNG vehicle conversion costs 5,000 L.E. (about $1,100).• High fuel-use vehicles, such as taxis, can quickly recover the total cost of conversion from fuel savings.• Vehicle maintenance savings are also realized from extended intervals for tune ups and oil changes.
Customer Conversion Financing
NGVC and E.I.G. TEC provide financing for vehicle conversions:Offers customers payment options of 12, 24 or 36 monthsMonthly fuel cost savings provides loan repayment capability.This “Tool” accelerates the rate of CNG infrastructure development.New “Gas Card” system to be implemented Fourth Quarter, 2002.
Cairo Air Improvement Project (CAIP)
• The USAID funded $ 63 million CAIP has supplied 50 dedicatedCNG public transit buses. NGVC and E.I.G. TEC are providing theCNG fueling stations to support this clean air project.
• Technology transfer/licensing agreements will enable Egypt toboth assemble and repower public transit buses to CNG.
Egypt CNG Bus Program
•GCBC diesel bus repowered to CNG operation by NGV Ecotrans (California).
•Technology transfer/licensing agreements from NGV Ecotrans/NGVC.
•Future diesel bus repowering to CNG and Egypt assembly of new CNG buses.
Egyptian Government Commitment
Petroleum Ministry was the catalyst for CNG commercialization.
To ensure the utmost safety and performance of this newindustry, Egyptian Standards and Specifications must be strictlyadhered to and only companies approved by the PetroleumMinistry may engage in NGV activities.
The General Authority for Investment (GAFI) grants a five year taxholiday on earnings for each approved NGV company.
Through the leadership of the Ministry of State for EnvironmentalAffairs CNG public transit buses will continue to expand.
• Continued Egypt Government Encouragement• Increase in CNG Stations and Conversion Centers• Expansion of CNG to New Areas• Technology Transfer for Egypt Production of CNG Buses• Improved Air Quality and Public Health• Additional Employment Opportunities
Future Outlook for Egypt CNG