The road to the gas shortages and electricity blackouts: With the entire nation suffering from rolling blackouts thanks to gas shortages, it is important to look at the years leading up to the blackouts to see what led us to this point in time.

2023 was somewhat exceptional: The Electricity Ministry began reducing the electrical load inJuly 2023 to ration the consumption of natural gas production. The power cuts were originally blamed on summer heat waves, but after temperatures have fallen, officials noted that the one-hour cut saves the country some USD 300 mn per month. Our gas supply was dealt another blow in October when Chevron temporarily halted shipments of Israeli gas from its Tamar field due to the ongoing war in Gaza.

Egypt’s energy portfolio was a mixed bag in the decade leading up to 2023, between falling oil output and fluctuating LNG production, according to the Energy Institute’s 2024 Statistical Review of World Energy (pdf).

LNG production down: LNG output fell 11.5% y-o-y in 2023 to 57.1 bn cubic meters (bcm). At the same time, LNG consumption grew at an annualized rate of 1.9% in the ten years leading up to 2023, when consumption hovered at some 60 bcm.

A hit for our LNG exports: After growing at an annual rate of 2.3% between 2013 and 2023, our LNG exports took a massive hit in 2023, falling 46.8% to sit at 4.9 bcm. After becoming a net exporter of LNG in 2018, Egypt has been trying to position itself as an important LNG exporter to Europe and to fully utilize the 12 mn tons a year capacity from its two liquefaction plants in Damietta and Idku. However, a fall in domestic gas production caused our exports to take a hit.

More electricity production, but it’s still not enough: Electricity production grew at an annualized rate of 2.9% in the ten years leading up to 2023 to settle at some 220.1 terawatt hours (twh), the report showed. Despite this growth, there remains quite the gap between supply and demand — our electricity consumption was up some 4.4k MW last year in comparison to the year before due to higher temperatures.

The breakdown: Natural gas accounted for the lion’s share of Egypt’s electric output making up 81.2%, followed by hydroelectricity and other renewables (11.3%) and oil (7.5%).

It also means less production: Fertilizer companies have been struggling to keep the lights on and operations ongoing amid the ongoing gas shortage, with many having to pause operations time and time again. Meanwhile, ceramics producers reported noticeable declines in production due to the gas shortage.

So what’s the plan? Egypt has resorted to importing LNG in order to bridge the gap between local production and demand for electricity generation, in a turnaround from its previous status as a net exporter of the fuel. State gas firm EGAS recently secured some 20 LNG shipments as it works to ensure it has sufficient supplies to keep the lights on during the current period of increased demand expected to last till September.

What about our oil production? Egypt’s oil production declined at an annualized rate of 1.5% between 2013 and 2023, standing at some 610k barrels per day (bpd) at the end of 2023, the report said. The figure contrasts with a 1.1% increase in global oil output as non-OPEC producers ramped up production throughout the decade. Despite oil consumption declining at a yearly rate of 0.3% over the decade, Egypt consumed some 742k bpd of oil in 2023, yielding a 132k bpd deficit.

And then there’s Egypt’s emissions record: Carbon emissions grew at an annualized rate of 1.1% between 2013 and 2023 — emissions stood at some 279.3 mn tons of CO2 equivalent by 2023, the report showed. Our emissions increased at a rate faster than the 0.8% global trend. Nevertheless Egypt’s carbon footprint was considerably lower than our Gulf neighbors — KSA produced 725.9 mn tons of carbon emissions in 2023 and the UAE produced 340.8 mn tons.

Egypt is lagging slightly behind in terms of its green transition: Renewables consumption grew at an annualized rate of 4.8% in the ten years leading up to 2023 in Egypt, standing at some 0.23 exajoules by the decade’s end. The same period saw a 5.5% per annum ramp up in renewable energy consumption globally to 85.49 exajoules, the report said.

THE BIGGER PICTURE-

Regionally, oil production took a hit: Many regional states underwent notable dips in hydrocarbon production between 2022 and 2023 as OPEC+ production cuts came into play — GCC oil giants and OPEC members KSA (6.6%), Kuwait (4.2%), and the UAE (2.5%) all experienced dips in output.

Dip in production to last? OPEC+ has recently extended its cuts into 2025 in efforts to stimulate demand.

Your top infrastructure stories for the week:

  • Adeer to set up mixed-use development in East Cairo alongside Paragon: Real estate company Adeer is working with local real estate player Paragon Developments to build a mixed-use development in eastern part of Cairo.
  • Real Estate Development Chamber aims to work with gov’t on affordable housing: The Federation of Egyptian Industries’ Real Estate Development Chamber is planning to propose an integrated affordable housing initiative that would see the government facilitate private sector development of affordable housing projects.
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