The Egyptian General Petroleum Corporation (EGPC), Egypt’s national oil company, is expected to approach international banks to provide debt to be used to refinance outstanding liabilities owed to foreign oil companies.

According to local press reports, oil minister Sherif Ismail, said on 30 September that the government will issue a tender to banks after the Muslim Eid Holiday in early October.

The news comes as EGPC signed a E£10bn ($1.4bn) loan with a consortium of local banks, led by National Bank of Egypt, on 1 October, which was used to repay debt to foreign oil and gas entities.

A repayment of $1.5bn to foreign oil firms was announced the day after the loan was signed, in a move that has reduced EGPC’s debt to $4.9bn.

Additional banks participating in the debt facility are Commercial International Bank, Arab African International Bank, Bank of Egypt and Qatar National Bank Al-Ahly.

The loan comprised of an E£6bn loan in local currency to be repaid over five years with a one-year grace period and a $550m US dollar loan to be repaid over four years with a one-year grace period.

Between $2-3bn-worth of debt is expected to be repaid before the end of the year, according to local reports.