Egypt has inked $3bn-worth of agreements with energy companies Shell and TotalEnergies to procure 60 cargoes of liquefied natural gas (LNG) this year, reported Reuters, citing three trading sources.
This move is aimed at satisfying the nation’s gas requirements amidst a backdrop of declining domestic production and a return to net importer status.
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Egypt’s domestic supplies reached a seven-year low last September.
The drop in production was primarily due to decreased output from the Zohr gas field and increased power consumption, as reported by the Joint Organisations Data Initiative.
Shell has opted not to comment on the deals, while TotalEnergies and Egypt’s petroleum ministry have not yet responded to requests for comment.
In November 2024, Reuters reported that Egypt was negotiating with the US and other foreign companies to secure long-term LNG volumes to reduce its dependence on the spot market.
To meet summer demand for air-conditioning, Egypt purchased several LNG cargoes on the spot market, paying a premium of $1–2.
With LNG spot prices in 2025 averaging more than $14 per million British thermal units (MBtu), up from $12/MBtu when Cairo began tendering, the financial strain on Egypt is increasing, especially in light of its foreign currency shortage.
In January, Egypt issued a tender for four LNG cargoes to be delivered between February and March, with the possibility of another spot tender later this year, depending on demand, market conditions and prices.
Data from consultancy Energy Aspects predicts a 22.5% decline in domestic gas output by the end of 2028.
At the same time, analysts forecast a 39% increase in the country’s power consumption over the next decade.
