The years-long fall in oil and gas production will soon come to a very welcome halt, according to remarks made by Oil Minister Karim Badawi in a ministry statement. Thanks to increased efforts to raise field productivity, gas and oil production will stabilize in the next two months, he said. Badawi did not elaborate on whether he meant that both the oil and gas sectors will halt production declines, or if they will collectively put an end to the fall in total energy production.

Halting the decline is just step one, with the ministry setting its sights on soon ramping up production. Egypt is working to not just cut down its energy import bill, but become a regional energy exporting powerhouse under a plan detailed in a government document seen by EnterpriseAM that we covered last week in our Hardhat deep dive. While our energy import bill is expected to reach a burdensome USD 10 bn for the next fiscal year, the state thinks it can reverse its energy trade fortunes and bring in USD 5 bn in energy exports by the end of the decade. This would raise the sector’s contribution to GDP to 8.0% by 2030, up from 5.8%.

IN CONTEXT- Badawi’s comments come as Egypt faces a widening gas supply gap heading into peak summer demand. Egypt reportedly aims to import 155-160 shipments of LNG in 2025 to close the gap between demand and supply. Egypt needs around 6.2 bn cubic feet per day (bcf/d), but domestic production only contributes roughly 4.4 bcf/d.

Fresh projects, in addition to improving productivity, are part of the plan, with the Oil Ministry finalizing 15 upstream agreements worth USD 618.5 mn, on top of 12 already signed this fiscal year totaling USD 631 mn, Badawi was quoted as saying by Al Mal. The 27 agreements cover the drilling of 123 wells and are expected to add some 41k barrels of crude oil per day and 1.4 bcf/d.

But until then, we’re going to need shipments of LNG to fill the gap — and regasification units to process them. The government is mulling another floating storage and regasification unit to ease pressure on the grid ahead of peak summer demand, hoping to secure enough gas to avoid a return to rolling blackouts, unnamed sources told Bloomberg.

This would bring the number of regasification vessels helping Egypt throughout the summer months to five, alongside the recently arrived Energos Power and the already docked Hoegh Galleon in Ain Sokhna, which will soon be joined by the Energos Eskimo that’s currently in Jordan’s Aqaba and a floating storage regasification unit from Turkish state-owned energy firm BOTAS.

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