Egypt is in advanced negotiations to secure long-term liquefied natural gas (LNG) import contracts through 2030, as the country grapples with weakening domestic gas production and rising energy demand, according to government and industry sources.
The Ministry of Petroleum and Mineral Resources is reportedly in talks with several international suppliers to lock in stable LNG supplies over the next five years. The move marks a strategic shift for Egypt, which had positioned itself as a regional energy exporter in recent years but now faces mounting supply challenges.
Declining Output, Rising Demand
Domestic gas production in Egypt has slowed significantly, with key offshore fields such as Zohr underperforming relative to initial expectations. At the same time, power consumption has surged, driven by economic growth, industrial demand, and a scorching summer season that has strained the national grid.
“With the current production trajectory, Egypt is likely to face a shortfall unless alternative sources are secured,” said an energy analyst familiar with the talks. “Long-term LNG contracts are a way to ensure stability and avoid sudden price shocks in the spot market.”
From Exporter to Importer — Again
Egypt had celebrated a return to LNG export status in recent years, with the Idku and Damietta liquefaction terminals shipping gas to Europe and Asia. However, a dip in domestic output and growing internal consumption have forced the government to reassess its export strategy.
Officials say the new LNG import deals will be structured to supplement domestic supply during peak demand periods, particularly in summer months when power generation needs soar.
Energy Security and Economic Implications
The push to secure LNG imports reflects a broader concern over energy security, especially as the country looks to maintain momentum in manufacturing, infrastructure development, and foreign investment.
However, energy economists warn that a prolonged reliance on imported LNG could put pressure on Egypt’s foreign reserves and subsidy budgets. The government is said to be exploring financing mechanisms and potential support from Gulf allies to mitigate these impacts.
Egypt is also continuing to explore new offshore fields and boost production efficiency in existing sites, but these efforts may take years to yield significant output.
Strategic Balancing Act
As Egypt balances its ambitions of becoming a regional energy hub with the realities of domestic supply constraints, the outcome of these LNG negotiations will be critical. Analysts say the deals could act as a short-term buffer — but long-term sustainability will depend on renewed exploration and production investment.
“Egypt’s energy future hinges on its ability to stabilise supply while managing demand growth,” said Mona Helmy, a Cairo-based energy consultant. “This is not just about fuel — it’s about economic continuity.
