We’ll ring in the new year with the resumption of LNG exports: Egypt is set to resume LNG exports in January after half a year with virtually no gas leaving our shores, Al Arabiya reported yesterday, citing an Oil Ministry official. The government hopes to export as much as 1 bn cubic feet of gas per day from the beginning of next year, according to the official.

Remember: LNG exports have been on hold since the first half of the year due to an unusually long summer heatwave, declining local production, and disruption caused by the war in Gaza. We’ve been sitting tight awaiting the resumption on exports following reports that an LNG vessel has arrived at a liquefaction plant in Idku a week ago

Thank the winter season and the resumption of Israeli gas imports:

  • Local demand is dropping significantly with the arrival of cooler weather: One unnamed source familiar with the situation told the news outlet that consumption will fall to 6 bn cf/d in January, down from 7 bn cf/d in the summer months.
  • Imports of Israeli gas are back to normal: Egypt is now importing 800 mn cubic feet of Israeli gas per day after Chevron restarted production at the Tamar gas field and reopened the EMG pipeline between Egypt and Israel.

It hasn’t been a great 2023 for LNG exports: Egypt has exported just 3.38 mn metric tons of LNG so far this year, down from 7.1 mn tons during the whole of 2022. The country has capacity to export more than 12 mn tons a year via its two liquefaction plants at Damietta and Idku.

How much gas is Egypt producing? Egypt is currently producing between 5.9-6.1 bn cf/d, slightly below the 6.2 bn cf/d during FY 2022-23.

DANA GAS TO GET DRILLING-
Emirati firm Dana Gas is planning to invest USD 43 mn in Egypt next year, as part of an “intensive” natural gas drilling program, the Oil Ministry said yesterday. The company plans to drill 11 development wells and three exploratory wells next year, with the aim of increasing production by some 30 mn cubic feet per day.

FYI- The company currently operates 14 development leases onshore in the Nile Delta, producing 125 mn cf/d.

Pending parliamentary approval: The firm is awaiting the greenlight from the House to start the drilling work, which will happen under an exploration agreement with state-owned EGAS.

More to come? The company had previously said that it wants to invest USD 100 mn in Egypt over the next two years.

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