The Egyptian Natural Gas Holding Company (EGAS) has established a gas subsidiary in Saudi Arabia, reported Reuters, citing Egypt’s Ministry of Petroleum. 

The move is part of EGAS’ strategy for offshore expansion, particularly within the GCC countries.  

Called Modern Gas Saudi Arabia, the new company is 80% owned by EGAS and starts with initial capital of SR2m ($530,000).  

This development is in line with Egypt’s broader strategy to attract foreign currency inflows, which are essential to alleviate the local business activity constraints and payment delays for commodities caused by the current shortage.  

As per the report, the Egyptian pound has seen a substantial devaluation against the dollar, losing more than two-thirds of its value since early 2022 when the foreign currency crisis intensified. 

In a bid to address this economic challenge, Egypt recently secured an expanded $8bn deal with the International Monetary Fund (IMF). 

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Additionally, a $35bn investment deal with the Emirati sovereign fund ADQ has been secured, providing some relief to the foreign currency situation. 

Last month, British energy major BP announced a $1.5bn investment plan in Egypt for development and exploration activities.  

BP CEO Murray Auchincloss expressed the company’s intent to increase its presence in the Egyptian oil and gas exploration sector during a meeting with Egyptian President Abdel-Fattah al-Sisi at the Egypt Petroleum Show, EGYPS 2024, in Cairo.  

Auchincloss also mentioned the possibility of an additional $5bn investment over the coming years, which would bolster Egypt’s efforts to export surplus energy and meet growing local market demand by expediting development and production plans. 

In a related development, Abu Dhabi National Oil Company (ADNOC) and bp have disclosed plans to form a new joint venture (JV) in Egypt.  

bp holds a majority 51% stake while ADNOC owns the remaining 49% stake in the JV, which will initially encompass bp’s interests in three development concessions and various exploration agreements in Egypt.