Nigerian Firm Signs $30 million gas Cylinder Deal in Egypt

By June 26, 2019 Investment News

An indigenous Nigerian firm, Rungas Industries in partnership with the United Group of Egypt, has secured a $30 million gas cylinder project with the National Organisation for Military Production (Egyptian government).

The partnership will see the Nigerian firm and its partner produce and distribute 200,000 LPG composite cylinders for domestic use (cooking) and CNG cylinders for vehicles and automobiles. The Government of Egypt has already allocated 28,000 square metres of land to aid the commencement of the project.

The partnership was a result of extensive product research carried out at Amtrol facility in Portugal, visited by an Egyptian delegation to carry out a compliance inspection to ensure that cylinders met all standards for cylinder production in Egypt.

Lanre Runsewe, CEO, Rungas Industries. According to the statement, the first phase of the project requires a type III LPG composite cylinder facility to be set up in Egypt.

With the commencement of the project will see Egypt export gas cylinders to neighbouring Arabic countries, and serve north and eastern African markets. The Egyptian Government is hoping the project will benefit from the recently signed African Continental Free Trade Agreement (ACFTA).

With this deal, Rungas Industries will be a continental force, this is according to the Chief Executive Officer, Lanre Runsewe, leveraging on its proposed LPG composite cylinder facility in Nigeria.

“CNG is important for the Egyptian government because of the need to run on cleaner fuel and also to meet IMF condition, which advised the country to reduce fuel subsidy.”

According to Runsewe, the groundbreaking date for the project will be in September 2019 and production of LPG cylinders is expected to start within 9 months from the groundbreaking date, while the launch date for the CNG composite cylinders is in 18 months.


Source: Nairametrics