Egypt’s LNG: A Treasure Trove for Europe’s Energy Needs 

When the Russia-Ukraine war erupted, Europe was faced with what many perceived to be an insurmountable energy crisis that would put the continent’s self-sufficiency and energy security to the ultimate test. What could have been a deep predicament was averted with the help of rich gas reserves in the East Mediterranean, an asset that served as nothing less than an answer to a prayer for the Europeans, offering new hope for the continent to live a more stable future. At the center of all of this, Egypt found itself in an ideal and geographically advantageous position to not only take the lion’s share of profits due to Europe’s renewed demand for natural gas, but to ensure Europe’s energy security for the years to come.

Europe’s energy partnership with Egypt couldn’t have been spelled out more clearly than with European Commission President Ursula von der Leyen’s statement in June 2022 during her Cairo visit. According to a report from France 24, she said “Russia’s war against Ukraine has exposed our European dependency on Russian fossil fuels, and we want to get rid of this dependency”, during a joint press conference with Egyptian President Abdel Fattah El Sisi. “We want to diversify to trustworthy suppliers, and Egypt is a trustworthy partner,” she added.

 Both convenient in location and amount, Egypt’s natural gas market was quick to grab Europe’s attention with significant deals being struck for shipments to start rolling into European markets. A tripartite memorandum of understanding (MoU) between Egypt, the European Union, and Israel was a major breakthrough in this regard.

Last February 2023, the EU’s Commissioner for Energy Kadri Simson said that there are expectations that Egypt will sustain “relatively high” volumes of liquefied natural gas exports to Egypt over the past year. 

Data has indicated that Egypt already has an impressive capacity to produce natural gas at an extraordinary rate. During 2023, experts estimated that Egypt will produce 8 million tons of liquefied natural gas (LNG), especially after the major discovery in the Narges area last January. According to a recent report, Egypt’s LNG exports increased to 7.5 million tons in 2022, a 14% year-on-year (YoY). 

Sustainability efforts have been pushed forward even as Egypt works to satisfy surging European demand. According to the World Bank (WB), Egypt and Algeria are the two major producers that are expected to cut significant amounts of emissions through flaring for the years to come. On a global level, these efforts have proven effective with the WB indicating that global gas flaring experiencing a 3% dip to 139 billion cubic meters (bcm) in 2022 from 144 bcm in 2021.

As an Egypt-led effort and initiative, the East Mediterranean Gas Forum (EMGF) has also been a key factor in securing the necessary gas supplies to Europe by bringing together all the region’s main stakeholders. 

With Egypt building up its capacity to become a major LNG supplier for Europe, it is also quick to advance its interests in other essential fields within the energy mix. Renewables have become an integral component of the country’s new energy strategy, which may make up 42% of Egypt’s energy mix by 2030 according to the most recent revisions. 

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