The Oil Ministry received the go-ahead to sign contracts for up to 60 LNG shipments through early September to meet an expected high electricity demand, a government source told EnterpriseAM. The contracts are expected to help fully cover energy demand throughout the summer and back the government’s pledge to keep the lights on this summer and not return to planned outages.

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The total value of the shipments is expected to land between USD 2-2.5 bn, the source said, adding that the Finance Ministry has approved the required funding. The payment terms will see Egypt pay a portion of the contract value upfront, with the bulk of payments deferred.

The shipments through September will help make up for a dip in Israeli gas flows expected to continue till August, with pipeline imports falling to 850 mn cubic feet per day (mcf/d), down from the usual 1 bcf/d, due to higher domestic consumption in Israel, the government official told us. This is in addition to a 20% decrease in Israeli flows on the back of a planned 15-day maintenance for its gas facilities, which forced our government to slash natural gas deliveries to fertilizer and methanol factories by 50%.

REMEMBER- We heard last week from a government source that a number of regional energy firms have put in offers to supply Egypt with LNG this year, with Saudi Aramco, UAE’s Adnoc, Algeria’s Sonatrach, and QatarEnergy submitting technical and financial offers to the Egyptian Natural Gas Holding Company.

But Egypt isn’t just focusing on increasing imports; it’s also working to add 450 mcf/d in new production capacity by incentivizing foreign players to ramp up exploration and production, according to the source.

Securing natgas supplies is a top priority: The issue was one of the main talking points during a meeting between President Abdel Fattah El Sisi, Prime Minister Moustafa Madbouly, and Oil Minister Karim Badawi last week. The three sides touched on how the government is preparing for the heightened electricity demand that accompanies the hot summer months. El Sisi highlighted the need to take the necessary steps to ensure electricity stability during the summer.

Egypt isn’t the only nation to see a reversal in its LNG trade fortunes, with traditional exporters like Malaysia, Indonesia, and Algeria poised to soon transition from net exporters to net importers, Shell’s integrated gas head Cederic Cremers told Reuters. Driving the change is rising domestic demand outstripping local production — much like in Egypt, which made the unenviable move last year after having a brief stint as a net exporter with the discovery of the Zohr field in 2018.

Shell sees global LNG demand climbing 60% by 2040, fueled by Asian growth, AI power needs, and industrial decarbonization. And with increased demand comes increased prices — assuming no unexpected jump in supply occurs.

We’re trying to secure our needs for years to come: EGAS inked a 10-year agreement with global maritime energy infrastructure player Höegh Evi for an LNG regasification vessel last week — Egypt will reportedly have four regasification vessels leased by the end of 2026, with a combined capacity of 3 bn cubic feet per day, to help meet rising energy demand.

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