The collapse of a deal to restart liquefied natural gas exports from the long-dormant Damietta LNG joint venture leaves the Egyptian government vulnerable to $1 billion in claims from partner Spain’s Naturgy.

Naturgy and partner Eni in February said they had signed agreements with the other Damietta stakeholders — state-owned Egyptian General Petroleum Corporation (EGPC), the Egyptian Natural Gas Holding Company (Egas) — to bring back on stream the LNG facilities by June 2020.

However, the deal fell apart following the collapse of the gas markets and the inability of workers to access the plant due to the coronavirus outbreak.