Spokesman Abdel Rahmane Shahine told AFP that a group of doctors and parliamentarians are working on the text which will be presented to parliament when it meets again in November.
'The proposed law is aimed at strengthening penalties' for the practice, he said, without elaborating. Those currently in place, he added, are 'not proportional to the seriousness of the crime.'
People found guilty of carrying out female circumcision currently risk up to three years in prison.
The health ministry will also allocate a further one million euros (1.365 million dollars) in the fight to stamp out the practice, Shahine added.
Newspapers on Saturday reported that Karima Rahim Massud, 13, died as the result of problems with the anasthaesia in the Nile Delta village of Gharbiya.
In June, following the death of 12-year-old Bedur Ahmed Shaker, Health Minister Hatem al-Gabali issued a decree banning every doctor and member of the medical profession from performing the procedure.
Female genital mutilation, also known as female circumcision, is a practice that dates back to pharaonic times in Egypt. It is common in a band that stretches from Senegal in West Africa to Somalia on the east coast, and from Egypt in the north to Tanzania in the south.
The practice, which affects both Muslim and Christian women in Egypt, was banned in 1997 but doctors were allowed to operate 'in exceptional cases.'
Female circumcision can cause death through haemorraging and later complications during childbirth. It also carries risks of infection, urinary tract problems and mental trauma.
Religious leaders, usually silent on taboos relating to female sexuality, have also started to speak out against the practice, which many Egyptians believe is a duty under Islam and Christianity.
After the death of Shaker, chief mufti Ali Gomaa declared female circumcision forbidden under Islam.
Mohammed Sayyed Tantawi, the sheikh of Al-Azhar university, the top Sunni Muslim authority, and Coptic Patriarch Chenouda III also declared it had 'no foundation in the religious texts' of either Islam or Christianity.