By Hani Hazaimeh

AMMAN - A special commission will be in charge of monitoring and setting prices of fuel derivatives on monthly basis after oil subsidies are lifted next year, officials said.

The commission is provided for in the draft petrol and minerals law, which is to be presented to the Lower House, said Minister of Energy and Mineral Resources Khaldoun Qteishat.

He told reporters following the Cabinet meeting yesterday that his ministry, in cooperation with the Jordan Petroleum Refinery Company, will be doing the job of the commission pending Parliament’s endorsement of the draft law.

The government plans to lift oil subsidies totally in 2008. The exact date of the measure has not yet been decided, but the 2008 state budget allocates no funds for these subsidies.

The minister explained that pricing of fuel derivatives will follow a specific mechanism based on international oil prices, taking into consideration freight and handling costs. The pricing will take place on a monthly basis.

The Cabinet dedicated yesterday’s session to looking into the 2004 national energy strategy, which has been modified due to several factors, including change in the demand for basic energy resources and electricity.

Qteishat told reporters that the strategy originally put annual growth in demand on basic energy sources, such as oil and gas, at 3.4 per cent and electricity at 4.6 per cent. These percentages, the official said, have changed to 7.2 per cent and 8.9 per cent respectively during the past three years.

According to the amendments to the strategy, growth in consumption is estimated at 5.5 per cent for basic energy sources and 7.4 per cent for electricity.

The swelling oil bill was another major reason for the modifications made to the energy strategy, he added, noting that 96 per cent of the country’s energy needs were imported in 2007, while local sources covered only 4 per cent of national consumption.

The new version of the strategy aims to increase the local contribution to energy supplies to 25 per cent in 2015 and to 39 per cent in 2020.

Towards this end, the government will focus on renewable sources of energy such as wind and solar energy, in addition to aptly tapping the potential of conventional sources. For example, the capacity of the Risheh gas field, which produces 21million cubic feet annually, providing 3 per cent of local energy needs, will be increased to one billion cubic feet by the year 2015, to supply the Kingdom with 9 per cent of its energy needs.

The government will be looking for a strategic partner to implement such a “huge project”, which needs advanced technology, he said.

The government also plans to utilise the country’s vast deposits of oil shale. Qteishat said the first electricity generation plant using oil shale is expected to be ready in 2015.

Uranium reserves in Jordan are estimated at 80,000 tonnes. The minister said the concerned agencies will be utilising such wealth “soon”. He noted that plans to build a nuclear energy plant for peaceful purposes are under way. The reactor is expected to be operational in 2020, the official said, adding that the necessary amendments to relevant legislation will be made and referred to Parliament.

Meanwhile, Minister of State for Media Affairs and Communications Nasser Judeh told reporters that the Cabinet will be dedicating every weekly meeting to a predefined issue. Last week, the ministers discussed the housing strategy.