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follow up
ostriches safe for now
[“filet of ostrich,” december 1997]
this december will mark the third year since egyptian private entrepreneurs
first began importing ostrich eggs in an effort to build a market
for a new meat. but today, almost 900 eggs and £e 2 mil-lion
later, investors have yet to but-cher their first bird. the problem?
egypt still hasn’t come up with guidelines for the legal slaughter
of ostriches, so investors are still waiting to make a killing.
industry sources say the reason behind the delay isn’t that
the government doesn’t support os-trich breeding. in late 1995,
the government approved private sector investment in ostrich farms
with the hope that ostrich meat would become a cheaper alternative
to poultry and beef. the problem, they say, is that the government
lacks experience. “there were never any regulations on ostriches,”
said khaled mobada, marketing manager for the egyp-tian-saudi ostrich
co. for invest-ment & agricultural develop-ment. “so of
course they don’t know how to handle it.”
the public authority for veter-inary services, the government agency
in charge of setting slaugh-ter regulations and guidelines, is now
conducting experiments on ostriches to determine how they can be
killed hygienically and in harmony with islamic mores. they also
want to know how much of the bird is good to eat. but there are
plenty of other auth-orities involved. according to mazhar al mansuri,
the director of man group slaugh-terhouses, in-vestors have spent
the past year running be-tween the various institutions – al
azhar, the world health organiza-tion, the public authority on nutrition,
the public auth-ority for veterinary services and the ministry of
agriculture – whose approv-al is needed before the slaughter
can begin.
nndelay has its costs. according to mobada, there’s no point
slaughtering an ostrich that is more than 14 months old. after then,
the meat becomes stringy. “ostriches over 14 months are useless
in terms of sales,” he said. what they are useful for, however,
is breeding. esociad originally had planned to slaughter 60 ostriches
and breed 42. but because of the regulatory problems, they are stuck
with about 100 breeders – which mobada said constitutes a considerable
financial loss.
nnand the problem goes beyond meat. ostriches yield three products:
meat, feathers and leather. esociad is particularly interested in
marketing the latter to producers of shoes, handbags and luggage.
at the moment, ostrich leather is imported in the form of finished
goods, which sell in upscale boutiques at prices between £e
2,500 to £e 3,000. “if esociad markets and sells the
leather, prices of shoes can be reduced and the popularity of ostriches
will increase,” mobada said. of course, these plans are frozen
as well.
nnthe losses aren’t confined to esociad. there are about a
dozen ostrich farms lining the cairo-alexandria and cairo-ismailiya
roads, with more than 900 eggs between them. esociad alone has 460
eggs and has helped set up the other farms in order to build a stronger
market. the losses have also spread to the wholesalers, who had
contracted to buy the meat for distribution to five-star hotels,
restaurants and upscale supermarkets. as we reported last december,
esociad was banking on creating demand by pushing the product. but
with supply on hold, so is the market. “of course this affects
business,” mobada said. “but it’s not so much a matter
of financial loss as a waste of time.”
nevertheless, investors remain interested in the ostrich market.
ashraf enaba, a real estate investor who is develop-ing ghrandel
beach resort, one of the seven tourist centers in ras sidr, has
also put his money into a 125 feddan ostrich farm that will eventually
house about 3,000 ostriches.
“we are still importing eggs,” said mobada, who brought
in 2,000 this year. his company also plans to build a slaughterhouse
and a tannery within the next six months.“despite the delays
in slaughtering, i have no regrets in entering this market,”
he said. “ostrich is a new meat that can replace chicken and
beef, especially after the mad cow scare.”
leila atraqchi
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peace pipeline nears
[“another no on gas to israel,” may 1998]
the italian energy company eni spa announced in mid-october that
it had agreed with the palestinian national authority to study a
project to supply the gaza strip with egyptian natural gas, a step
toward creating the first export market for egyptian gas and one
that eni said brings the politically troubled peace pipeline project
closer to reality.
in addition, eni chief operating officer luciano sgubini said the
italian energy company was working to arrange the sale of egyptian
natural gas to israel, arrangements egypt’s minister of petroleum
said egypt would support.
“we are working on a number of opportunities. among these opportunities,
there is also this one,” sgubini said of gas sales to israel.
“if we can succeed to find the right commercial deal with the
israeli organization or buyers, we are free to.”
as we reported in may, israel has long been seen as one of the most
promising markets for egypt’s burgeoning reserves of natural
gas. but plans to link egypt’s fields with consumers in israel
by a pipeline running up the eastern mediterranean shore fell apart
last year, in part due to the pressure of political difficulties
following the 1996 election of hardline israeli prime minister benjamin
netanyahu.
egyptian minister of petroleum hamdy el banbi has rec-ently softened
egypt’s stance, saying in may that political issues could be
resolved by the time israel’s gas infrastructure was ready
and that petroleum companies operating in egypt were free to export
their share of production to whatever market they could secure.
eni is now the company closest to taking advantage of that opening,
at least as far as israel and the gaza strip are concerned. already,
eni has committed with egyptian au-thorities to finance and build
a gas line to connect offshore nile delta gas fields being developed
by its affiliate inter-national egyptian oil co. to the north sinai
town of el arish, which is within striking distance of the gaza
strip. extending the pipeline to the gaza strip, as proposed by
the october agreement, would put ieoc gas within striking distance
of the much larger market in israel
“today’s agreements are the first real step toward the
im-plementation of the so-called ‘peace pipeline’ project
which eni has been studying for years,” eni chairman guglielmo
moscato said in a faxed statement.
all of the key details of the gaza proposal remain to be discussed,
an eni official said, but the company’s agreement with the
pna envisions a long-term gas supply contract and the formation
of a joint-venture company by the pna and eni’s natural gas
distribution arm, snam, to des-ign, build and manage a natural gas
supply infrastructure in the palestinian territory and to market
the gas.
in october, el banbi expressed support for eni’s agreement
with the pna as a first step. “if you can’t do everything,
you do what you can. i think this is an excellent start,” he
said. “the expatriates can export their gas wherever they wish.
it is their prerogative.”
international petroleum companies operating in egypt must create
joint-venture companies with the state petroleum authority when
they enter the production phase of their operations. a percentage
of the output is set aside for cost recovery, and the remainder
is divided between the parties. egypt has said it won’t export
any of the government’s share of the nation’s natural
gas output, in order to cover domestic demand.
petroleum industry sources, however, have previously doubted the
egyptian government would actually hand companies the final say
on whether egyptian gas would be exported to israel. they have also
said that negotiating difficulties and israel’s lack of sufficient
infrastructure have compounded political delays.
nevertheless, the dramatic growth in egypt’s gas re-serves
in recent years has far outstripped domestic demand, putting pressure
on the nation to find export markets. el banbi said in october that
egypt’s reserves of natural gas had tripled since 1992 to 36
trillion cubic feet. production, he said, rose 2 percent to 10.6
million tons in 1997.
egypt’s gas producers are said also to be looking for supply
contracts with turkey, jordan and countries in southern europe.
in related news, ieoc and amoco egypt have signed a contract to
sell 480 million cubic feet a day of natural gas to egpc, the first
sales contract covering their massive temsah concession in the mediterranean
and egypt’s lar-gest in terms of reserves covered to date.
with a market in place, ieoc and amoco plan to spend $700 million
over the next four years to develop temsah’s 3.9 trillion cubic
feet of proven reserves of natural gas.
andrew dowell
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