State-owned Egyptian Holding Company for Natural Gas (EGAS) recently purchased at least one shipment of liquefied natural gas (LNG) for immediate delivery to the Aqaba liquefaction station in Jordan, with the gas intended to be directed to Egypt, as reported by Bloomberg.

Egypt does not own facilities for liquefying natural gas, a process known as liquefaction, having previously operated a floating station in Ain Sokhna for gas imports before 2018. Egypt utilizes gas to fuel power plants as well as for cooling operations.

Egypt has two natural gas liquefaction plants with a total daily production capacity of 2.1 billion cubic feet, and exports depend on its surplus production and gas imports from neighboring countries. Both plants, which are on the Mediterranean coast, can export 12 million metric tons annually; a target the country aims to achieve by 2025.

Egypt significantly reduced its liquefied natural gas imports six years ago when the massive Zohr gas field bolstered domestic production, transforming the country into a fuel exporter.

In 2022, Egypt directed 80 percent of its LNG exports to Europe as the continent sought alternatives to Russian pipeline gas following the invasion of Ukraine. However, LNG exports for the current year have been limited due to heightened domestic demand during the summer, resulting in minimal or zero LNG exports from May to September.

However, Egypt currently relies on Israeli gas to meet part of its domestic demand, exporting surplus gas mainly to Europe in the form of liquefied natural gas through the liquefaction plants in Idku and Damietta, with a production capacity of 2.1 billion cubic feet per day.

In January, Israeli gas supplies to Egypt surpassed pre-war levels in Gaza, rising by 15 percent month-on-month to reach around 1.15 billion cubic feet per day.

The Egyptian government seeks to enhance its gas production capacities in response to rising domestic consumption, aspiring to become a regional gas hub, especially after the discovery of the “Zohr field” in 2015. This discovery stimulated investor interest in the Egyptian gas sector, enabling the country to export significant quantities of LNG.