The Economics of Natural Gas in Developing Countries

136 Pages·1985·10.116 MB·English

The Economics of Natural Gas
in Developing Countries
Guest Editor
John C. Gault
Senior Economist, IEDConsultants SA
International Energy Development Corporation
Geneva, Switzerland
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Published as a special issue of the journal Energy, Volume
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Energy Vol. 10, No. 2, p. 109, 1985 0360-5442/85 $3.00 + .00
Printed in Great Britain © 1985 Pergamon Press Ltd.
FOREWORD
A conference on the utilization of natural gas in developing countries took place in
Venice in June, 1982, under the sponsorship of Jensen Associates, Inc. of Boston and
the Financial Times of London. The papers originally prepared for that conference have
been revised and updated for this volume.
It was the goal of the conference organizers to focus attention as much upon the
potential domestic uses of natural gas as upon the export possibilities. A common theme
which unites all of the papers is that gas resources in the Third World have not yet been
utilized to their full capacity to support economic development. Although the gas volumes
required for individual local uses may seem small when compared with the vast
requirements of LNG or pipeline export schemes, the value of gas in such domestic
applications nevertheless may be quite high.
The many reasons why gas resources have been underutilized in the Third World are
well explained by the papers from the Venice Conference. Among the reasons cited are:
the lack of incentives for gas development provided in contracts between host governments
and private oil companies, the artificially low domestic gas prices imposed in some
developing countries, the lack of funds for pipelines and other facilities to bring gas to
domestic markets (commercial lending institutions favor projects which directly generate
foreign exchange), and the failure of both private and public sector organizations to
recognize how fast domestic demand might grow once natural gas has been made
available. Suggestions for overcoming these and other obstacles to gas development are
contained in the conference papers.
The paper by J. E. Hartshorn, although not originally presented at the Venice
Conference, was included in this collection because it presents a broad and thoughtful
overview of gas utilization issues. Two papers from the Venice Conference have been
omitted here at the request of the authors.
Jensen Associates and the Financial Times, as conference sponsors, contributed
considerable time and energy to putting together such a unique conference. The editor
wishes to thank them, as well as Pergamon Press, for their continued encouragement
during the preparation of this publication.
JOHN C. GAULTf
Conference Organizer and Co-chairman
t IEDConsultants, SA, International Energy Development Corporation, Geneva, Switzerland.
109
Energy Vol. 10, No. 2, pp. 111-118, 1985 0360-5442/85 $3.00 + .00
Printed in Great Britain © 1985 Pergamon Press Ltd.
INTRODUCTION:
NATURAL GAS DEVELOPMENT BEGINS AT HOMEf
J. E. HARTSHORN
Jensen Associates, Inc., 5 rue Pedro Meylan, Geneva, Switzerland
(Received October 1983)
Abstract—International trade in natural gas by pipeline and as LNG was the fastest growing
element in the world gas business during the last two decades. However, less than 15% of world
gas output crosses frontiers, a proportion closer to that of coal (10%) than of oil (50%). Gas, like
coal, should be considered a "market locating" fuel, since its transport cost often far exceeds that
of other manufacturing inputs. Moreover, gas export projects suffer from heavy front-end
investment costs and from uncertain demand growth in the importing countries. For these reasons,
developing countries with a potential for natural gas production must seriously consider all
opportunities for local gas utilization. In order to maximize the availability of gas for domestic
uses, policies which provide adequate incentives for gas development are required. Imaginative
formulae to encourage exploration specifically for gas, and imaginative technology to make local
gas development commercial on a smaller scale than most developers have considered so far, are
the current prerequisites for natural gas in developing countries.
NATURAL GAS TRADE IN PERSPECTIVE
It is unusual for an international seminar such as this to be concerned with gas for use
at home as well as for trading internationally. International trade in gas has tended to
monopolise most seminars and conferences on gas during recent years. This international
trade has been the fastest-growing element in the world gas business for about a decade.
The projects involved have been the biggest and the most newsworthy. Liquefied natural
gas movement by sea, in engineering terms, is at least a remarkable technology, and
at times can be economical. Gas pipelines are not technically remarkable; however,
international pipelines are nearly always both enormously costly and politically contro-
versial.
Moreover, all of the best-publicised gas projects of recent years, as LNG or by pipeline,
have been planned to augment the supplies of OECD economies with imports. These
have been planned either to meet the shortfalls of local gas supplies (as in the U.S.A. and
Western Europe) or to sustain extra use in Japan, where there is no gas and virtually no
other energy supply to start with. Nowadays, most natural gas is being discovered outside
the OECD economies. But most of the immediately effective demand is still there. Also,
the gas is still being discovered mostly by oil companies operating internationally, whose
business requires finding and developing for export the only fuel that is really convenient
and cheap to transport over long distances internationally. Moreover, most of the heavy
capital investment required for gas development, whether for export to OECD or for
local utilisation, needs to be financed from or via the international capital markets
of OECD.
These facts have understandably focused Western public attention on international
trade in gas. It is worth remembering that less than 15% of the world natural gas output
crosses national frontiers and less than 5% moves inter-regionally. This value should be
compared with the 50% or so of world oil production that normally moves in inter-
regional trade. To complete the comparison, one might add that only about 10% of world
coal production moves internationally. If both of these competing fuels develop more
t Based on a paper originally delivered to the EGPC-IEOC International Seminar on Natural Gas and
Economic Development, Cairo, 26-27 February 1982. Japan's LNG consumption was deliberately decided on
to diversify imports into an economy lacking any indigenous fuel, and is used to a large extent in power
generation, a bulk use taking no advantage of any of the inherent "form value" of natural gas except freedom
from sulphur. "OPEC and the Development of Fourth World Oil," and inaugural lecture at the School of
Oriental Studies, University of London, February 1977.
Ill
112 J. E. HARTSHORN
than oil and reduce the share of oil during the balance of this century, that says something
new about world energy trade and perhaps about the developing pattern of the world
economy.
Gas, like coal, would perhaps ideally be a market-locating fuel. It may be easier to
bring the other factors of production to the gas than to move the gas. That is what
happened historically with coal. This development will not preclude significant growth in
the gas export trade in the coming years or, probably, in the coal export trade as well.
When practical, it makes local development of gas reserves discovered in any country an
important option for that country to consider; and the assessment of both of these
valuable options, export and gas utilisation at home, are highly suitable and balanced
subjects for discussion.
OIL PRICES AND GAS EXPORT PROSPECTS
A discussion of energy must start with the price of oil. In assessing the prospects for
competing fuels, we became almost resigned, for a time, to sharp increases in that price
and to guessing how much further it might rise. However, since early 1982, we have had
significant declines in oil prices. First, spot prices fell and undermined official price levels
set by OPEC, with the real price in dollars being steadily eroded further by inflation. This
development was followed in early 1983 by a cut, even in nominal dollars, in OPEC's
official prices. We are now uncertain whether they may have to slip further before
stabilising. This is not a settled prospect for planning natural gas development. But, since
1973, settled prospects in energy have become things of the past. All that is predictable
is uncertainty. What has changed recently is something that back in 1978 I suggested to
my friends on the OPEC Long-Term Strategy Committee they might eventually have to
reckon with. In oil bargaining, the uncertainty has now spread to both sides of the table.
This sharp rise followed by a slower fall in oil prices first inflated and then punctured
prospects for a whole range of alternative energies. Suddenly, during 1979, they looked
economic as well as politically safer than Gulf oil. By mid-1980 and again after 1981,
when oil buyers decided that even a Gulf war need not worry them, these oil prices began
to slip. All of these developments have been highly confusing market signals, following
one another, for alternative energy developments that depend upon expectations about
prices for the later 1980s and after.
Natural gas is, of course, not among the way-out unconventional alternative energies
that suddenly looked viable and then had the rug pulled from under them again. It is a
mature energy source, widely available but, for the most part, remote from developed
markets. That makes transport costs critical for its development. The transport technologies
are fully established. Nevertheless, natural gas also involves very large, capital-intensive
projects and requires commitments from seller and buyer over exceptionally long periods
taking effect only several years after the moment of decision. So confusion in price
expectations for the late 1980s and 1990s may blur or postpone decisions that could
otherwise be made now. That is one reason why confidence in expanding markets for gas
is nowhere quite what it was a few years ago. Another reason is that, following the 1970s
when demand for gas rose much more than for other energy, there has been a pause.
Between 1980 and 1982, natural gas demand has levelled off or hardly fallen, while
demand for most other energy and for oil in particular, has fallen significantly more.
Gas along with other fuels has been affected by the weakening in energy demand
throughout the industrialised market economies of OECD. That has been caused partly
by a weakening in economic growth itself, from rates of 4% annually in the decade to
1973 to about 2.5% since, and of not much better than zero growth from 1979 to 1982.
Equally and more importantly, nobody can be sure, have been energy and oil savings in
the industrial economies. More of that saving has happened than anybody realised until
recently. It seems to have reduced the amount of energy radically that these industrial
countries need per unit of economic output. Most forecasters are expecting lower growth
than in the seventies, with further energy savings accruing from the two oil price shocks
and savings to continue throughout this decade.
Natural gas development begins at home 113
THE PAUSE IN SUPPLY PROSPECTS
World gas consumption is highly concentrated in the OECD regions (see Table 1).
Therefore, its growth could not escape the effects of recession and general energy savings
there. Nevertheless, these do not explain the whole of the pause in gas growth. The pause
came also partly from the supply side, notably in the interruption of particular projects
in the international gas trade. Most important, the Iranian revolution cut off pipeline
exports to Russia and planned swap arrangements by which further Iranian gas piped
there would have allowed extra Russian gas to be exported to Western and Eastern
Europe. Ironically, the Iranian revolution affected gas export volumes much more than
it affected the export volumes of Middle East oil.
At the same time, existing and planned LNG exports from Algeria to France ran into
difficulties in price renegotiation, as projects for the export of LNG to the U.S.A. had
already done. The 1979 step change in oil prices made Algeria's gas negotiators, for a
time, yet tougher. Then Algeria cancelled some further contracts for exports to Europe,
because it decided that LNG exporting required too much investment upstream which
made the option of pipelining the gas across the Mediterranean preferable. Nevertheless,
it took a long time also to agree on prices for gas through the only trans-Mediterranean
pipeline completed so far, for export to Italy. The transmission of supplies was also
delayed until long after the contractual date and the actual completion of the pipeline.
The 1979-80 takeoff in oil prices did not create pricing arguments between Algeria
and its customers but it sharpened and prolonged them. It temporarily enhanced supply
prospects planned for the 1980s. Most of the contracts for the projects had been signed
and had been considered viable at contract prices in the late seventies. Higher oil prices,
which made gas exporters more ambitious, tended to delay rather than hasten gas
deliveries. Even the Russian project for additional gas exports from Siberia to Europe
came into being essentially as a replacement of Iranian exports that had been cut off,
rather than in response to higher price levels for competing fuels. Perhaps the only major
viable gas project (at least temporarily) that was encouraged by oil prices in 1979 was the
pipeline planned to move Alaskan gas 4,500 miles south to the markets of the lower 48
states of the U.S.A. The higher level of price expectations following 1979 led to active
discussion of LNG export projects that had been in abeyance in Nigeria and Qatar among
the OPEC oil exporters and in several non-OPEC countries that have proven or highly
probable gas reserves greatly exceeding any volumes they could hope to consume at
home. None of these plans have as yet been confirmed by actual contracts. In most areas,
the weakening of price expectations since 1982 has caused further delays for reappraisal.
Table 1. World consumption of natural gas, 1970 and 1980, and projected to 1990, in 106 Bpdoet;
data from the World Bank (1981).1
Region 1970 1980 1990
Industrial Market 12.8 15.0 16.2
Economies *
USSR & E. Europe 3.8 7.0 12.3
Capital Surplus
Oil Exporters $ 0.1 0.2 0.6
Developing Countries'*
Oil Exporters 0.7 1.4 3.5
Oil Importers 0.3 0.7 1.6
World Total 17.7 24.3 34.2
For comparison:
World Total Oil 43.3 59.7 72.5
World Total Energy 99.1 135.5 185.1
Gas as % of Energy 17.9* 17.9% 18.5%
f Bpdoe = barrels per day of oil equivalent, or 50 X 107 kcal/yr.
$ Industrial market economies include OECD except Greece, Portugal, Spain and Turkey, included in
developing countries.
§ Capital surplus oil exporters are Iraq, Kuwait, Libya, Saudi Arabia, Qatar, and the UAE.
U Developing countries include China, four OECD member countries, and seven OPEC member countries.
114
J. E. HARTSHORN
Both of the two big pipeline projects that were planned for the 1980s to augment
OECD supplies, from Alaska and Russia, ran into opposition from American politicians.
The Alaskan pipeline project also encountered (and has for the time succumbed to) more
practical and severe scrutiny from American banks, which were asked to finance the huge
investment (perhaps some $20 X 109) that would have had to be advanced over a period
of five to eight years before the line could begin to move its full capacity of some 85
X 109 cubic metres a year. The project has now been shelved until at least the late 1980s.
The Russian pipeline project, which would move up to 35 X 109 cubic metres of gas
a year from the Yamal Peninsula in Siberia to Germany, France, Italy, Austria, and other
West European countries, was more robust, though the volumes will be somewhat
reduced or delayed. The U.S. government put whatever pressure it could, somewhat
ineptly, on its European allies not to carry out the contracts that some of them had
already signed, and raised obstacles to the installation in the line of technology involving
originally American know-how. Publicly, U.S. opposition was usually voiced in terms of
the security of the supply—the fear that if Western Europe became too dependent on
Russian gas it would become vulnerable to Russian political pressure. European buyers
such as West Germany seem to consider that argument specious. Russian gas looks to
them politically no more insecure than Arabian Gulf oil, and at any rate diversifies their
energy import risks. More privately, U.S. diplomats argued that Western finance and
technology should not be invested to back any major project that might benefit a Soviet
economy facing severe difficulties, and hence indirectly make high Soviet defence
expenditure more bearable. Neither argument, however, convinced the European gas
importers, whose heavy industries probably needed the pipeline construction orders even
more than European utilities may need the extra gas. Eventually, the U.S. government
backed down.
American political arguments on this issue tended to ignore one basic commercial
consideration. This Russian project offers European utilities gas at prices they believe
they can afford. The Russian prices were set and will escalate in relation to product prices
in the consuming countries, not to the crude oil prices at OPEC export terminals as
Algeria was claiming. Already, the contracts with Russia appear to have influenced later
Algerian gas price settlements with France and Italy. The prices agreed upon were
distinctly higher than those for the Russian gas and involved some political subsidy by
the importing governments, but they were below what Algeria had originally claimed.
The Russian contracts brought more commercial reality into the negotiation of other gas
export contracts.
Prospects for international gas trade indeed depend largely upon such development
of the Russian gas reserves, which are by far the world's largest. Iran, with the second-
highest reserves, has already been removed from the world market by political upheaval.
If further Russian gas exports had been halted, even temporarily, by American opposition,
then politics would have taken out of the potential world trade perhaps 70% of the
reserves that Jensen Associates would rank as the practicable "exportable surplus" of gas.
A part of the loss might be made up with additional exports of LNG. But in all
probability, gas markets in Europe would simply develop less in total: business would be
lost to oil.
GAS TRADE AND LOCAL USE
Trends in the international gas trade in the 1980s, therefore, remain highly uncertain.
Most forecasters, my own consultancy among them, are still guessing at growth rates of
say 8% annually for this trade through the decade, though that will require considerable
acceleration of development by the mid-1980s. However, even that growth of inter-
regional gas trade would still amount to only about a third of the total growth—say 3%
annually—that we expect in world gas consumption. Most of the growth in world demand
will continue to be met from gas production within the same regions. Apart from the
special case of Japan,f no sizeable market for natural gas has even been developed except
on the basis of large-scale indigenous reserves. Today, the U.S.A. remains the second-
largest gas producer, and the largest consumer. Even by the end of the century, it may
still be producing some 85% of its needs. North America (including Canada) will remain
Natural gas development begins at home 115
more than self-sufficient. Europe now produces over 85% of its own needs, and though it
may become dependent on exports for 60% of its gas by the year 2000, that will depend
partly upon the stretched-out depletion policies of its then major producers, the Netherlands
and Norway. The Communist sphere, likely to become the largest region of gas production
and consumption during this decade, has developed gas entirely upon the base of the
domestic Russian industry, which in 1982 became the world's largest producer.
Within OECD, regionally in deficit except for Australasia, this cannot continue. But
in the Communist economies, which will almost certainly account for the biggest
volumetric growth in the eighties, Russia can readily supply far more than will be needed.
In the developing world, where oil exporters as well as some oil importers may increasingly
turn to gas for their local energy needs, this self-sufficient development may take up some
60% of the extra gas production these countries hope to develop (see Table 2).
Most developing countries wherein gas is discovered will find it worthwhile to consider
gas exports, and a few may decide to commit all their reserves (for example Cameroon,
following the example of Brunei). Some may find it geographically convenient to import
gas in one area and export it in another (for example, Argentina). But for the most part
one can expect countries where significant amounts of accessible natural gas are discovered
to use some of it internally, whether they also export gas or not.
Large proportions of this extra gas production in developing countries will be
associated gas which up to now has been flared, unavoidably wasted because of the oil
production with which it has to be produced. Most of the OPEC exporters in the Gulf
have invested heavily to reduce the flaring of this valuable energy, using it for industrial
development at home while exporting some of the gas liquids that can be extracted from
it. Such industrial development will probably give those OPEC countries a significant
foothold—profitable or not—in the world petrochemicals trade. Also, the gas liquids will
increase their exportable liquid hydrocarbons per barrel of crude produced.
For all gas operations in countries that export oil, the economics of gas development,
for export or home use, are complex. Utilising gas at home and freeing extra oil for
export may well improve profits and petroleum revenues. Gas costs about twice as much
as oil per unit of energy moved through a pipeline, and about seven times as much
exported as LNG by tanker. Up to the present, no gas export operation appears to have
offered the producer profits per BTU of energy exported comparable to the economic
rents now obtainable on energy exported as oil. On the other hand, local gas markets are
not easy to create rapidly, and gas supplies usually become available, in relatively large
quantities, very suddenly. The transport facilities needed to move them, even within the
home economy, involve heavy front-end investments and need to be used to full capacity
as soon as possible.
Gas, we are continually assured, is a noble fuel that deserves to be used only in
premium markets. Unfortunately, premium markets often involve costly distribution
Table 2. Annual average percent growth in natural gas consumption. 1970-1990; data are from
the World Bank(1981).'
Regionf 1970-1980 1980-1990
Industrial Market
Economies 1.6 0.3
USSR & E. Europe 6.3 5.8
Capital Surplus
Oil Exporters 7.2 11.6
Developing Countries
Oil Exporters 7.2 5.8
Oil Importers 8.8 8.6
Total World
Natural Gas 3.1 3.6
Oil 2.8 2.0
Energy 3.0 3.2
t See notes accompanying Table 1.
116 J. E. HARTSHORN
facilities and generally have low load factors. Very few significant markets for natural gas
have been built up without bulk, high load factor sales (for example, to power stations)
to absorb the initial surge of supplies. Later, enthusiasts generally deplore this, or try to
divert the gas from such ignoble uses to premium customers. But without the initial bulk
sales, the local market might never have been developed at all.
My American colleagues in Jensen Associates spend much time analysing the peculiar
intricacies of the U.S. gas market, not all of which are readily translatable even into the
gas market economics of other OECD countries. My own experience has been more with
gas in developing countries, but gas developed for export as LNG. So I am glad to leave
to other speakers the prognosis of local gas market possibilities within developing
economies. The choices between local use and exports, and how much gas one might
reasonably reserve for local use later, depend largely on particular countries' circumstances.
They are associated with the cost of waiting, that social discount rate of time preference
which is so easy to define in theory and so hard to quantify in practice. The passage of
time is not neutral between countries. Its cost depends upon each one's resources and
opportunities.
The world's gas reserves are not far short of total proven oil reserves (see Table 3), and
they have been found, for the most part, as a by-product of exploration for oil. Since
production of gas is small in comparison with that of oil, the reserves/production ratios
in gas are far higher. But R/P ratios hardly matter in the gas industry outside North
America and Western Europe. Everywhere else, the constraints to gas development arise
not from reserves, but from project economics. For individual countries, however, finding
or adding to one's reserves of natural gas becomes distinctly important, particularly for
countries on the brink of developing local gas use or opportunities for export.
INCENTIVES TO EXPLORE?
Most gas has been found by accident, and most petroleum legislation makes it hardly
worth looking for gas on purpose. No petroleum exploration and development agreements
in existence anywhere were designed primarily for gas. That was true of the former oil
concessions. It has remained true in the various metamorphoses that have followed them,
such as production-sharing agreements, which have tended to establish government
ownership of the resource and to increase greatly the share that the government gets out
of resource development. But the petroleum resource in mind was virtually always oil.
Almost all the clauses that define performance and rewards for both sides in petroleum
agreements define these in terms of oil. There is usually a gas clause of two possible
kinds. One kind is an agreement to agree later if gas is found: in effect, convenient
because meaningless. The other simply rules that any gas found shall belong to the
Table 3. World reserves, production and reserves/production ratios for natural gas (109 m3); data
from Cedigaz (1983).2
Reserves Product ion R/P Ratio
(1.1.63) (1982) (Years)
North America 8356 572 15
of which USA 5765 497 12
USSR & E. Europe 35074 561 63
of which USSR 34500 501 69
West Europe 4324 175 25
Far East 6345 85 75
(Asia, Oceania)
South America 5151 70 74
Middle East 21645 38 569
of which Iran 11320 7
Africa 5776 35 165
World 86673 1535 56
of which OPEC 28625 85 336
Natural gas development begins at home 117
government. That may fortify or enhance national rights. Whether it will mean anything
or nothing to the country will depend on how much gas is found where, and whether
there seems anything sensible to do with it. Neither kind of clause gives explorers any
real incentive actually to look for gas—to drill, for example, where the geological
indications imply a greater likelihood of the occurrence of gas than of oil.
Thus, the explorers come looking for oil. The host government, quite reasonably,
usually stipulates that it should have prior rights to any gas found coincidentally. This
approach prevails mainly but not exclusively in non-OPEC developing countries, where
the price of imported oil for some and the need to get the best out of their known
petroleum opportunities for others (such as Egypt) make gas very well worth looking for
in the national interest. In the foreign explorer's private interest, it may not be.
In my own view, as a consultant practised in the design and the modification of
petroleum agreements, gas is one extremely important example of a new range of
problems arising between international companies and host governments. A related
problem occurs when a host country wants foreign explorers to find petroleum but later
may choose in the national interest to develop the petroleum differently from the way in
which the explorers would have chosen to develop it. Often, the difference arises over the
pace of development and production. Time is certainly not neutral between governments
looking to long-run national interests and companies whose development plans must
reasonably be influenced by commercial pay-out periods and discount rates. As regards
gas, this difference in rates of time preference is often complicated further by the "set-
aside" stipulations that host governments usually make. They want to defer any exports
of gas until enough reserves have been accumulated from discoveries to cover the amount
of local gas sales that they believe may eventually be developed in some chosen period.
The Canadian "set aside," often taken as a pattern, is 30 years' consumption at
current rates. For a country just starting to develop gas markets locally, choosing a
sensible period (and hence the amount of reserves to defer) is not easy. In the meantime,
until that much gas may be found, it may be left in the ground for years. If so, and if
the discoverer gets nothing in the meanwhile, why should an explorer look for gas at all?
REWARDS FOR DISCOVERY
The Egyptian government and a number of companies exploring in and offshore the
Nile Delta, led by IEOC (the Egyptian subsidiary of Italy's ENI group) are now
experimenting with a new gas clause in production-sharing agreements which is specifically
designed to address this problem. An interesting aspect of this principle is that, if an
explorer discovers significant reserves of gas which he is not immediately able to exploit
because these must be dedicated to the reserves deferred for local use, then there is
provision for some reward simply for having discovered it, as a multiple of his
expenditures laid out on the exploration. This is a principle that I raised for discussion
some years ago, but which I think has hardly been introduced into recent petroleum
exploration agreements anywhere else. It is a principle that may have particular application
to exploration for gas. More generally, host governments might be interested in the fact
that it fits another neglected feature of all petroleum exploration. In exploration the risks
are extraordinarily high, but the expenditure need not be enormous. Once the petroleum
is found, the risks are much lower but the expenditures are far higher. For finding a
nation's oil or gas, the discoverer deserves a very high rate of return on his very risky
gamble. For developing petroleum, he and the host government need an equity return,
covering normal commercial risk, on a far higher capital investment. Both, of course,
may be able to obtain institutional finance for this second stage from commercial or
international banks. Development may in any case be deferred, as with gas, or carried
out with a time profile of depletion representing the noncommercial national interests of
the country. If so, formulae are needed that can reward the explorer for his exploration
risk, as distinct from a normal return on development outlays, if further exploration is
to be encouraged at all.
Egypt and the companies introducing this unusual feature in petroleum formulae
(which have other unusual features such as joint commitments involving parties to several