Egypt's Natural Gas Holding Company (EGAS) has struck an agreement with Norway's Hoegh LNG to rent the Hoegh Galleon floating unit for liquefied natural gas (LNG), the Egyptian petroleum ministry said.
The floating storage and regasification unit will be leased "to secure additional needs for domestic consumption during the summer," the ministry said in a statement.
Hoegh LNG said the unit would be leased for an interim period from June 2024 to February 2026 and deployed in Ain Sokhna on the Red Sea. The aim of the agreement was "to support energy security in Egypt", it said in a statement.
Egypt is expected to ramp up LNG imports during the summer months to meet heavy demand that had led to a wave of rolling blackouts last summer, shocking Egyptians who had grown used to a decade of reliable power supplies by the gas producer.
The government bought at least two LNG cargoes in April and is expected to purchase up to 20 over the spring and summer to prepare for increasing power demand, sources had told Reuters.
Returning to imports would reverse the most populous Arab country's position as a natural gas exporter in recent years.
The North African country, which faces growing demand for gas from its population of 106 million, has been seeking a regional supply role but has made few large discoveries since the giant Zohr field in 2015.
In 2023, Egypt's total natural gas production fell 11.5 per cent year-on-year to around 59.29 billion cubic meters (bcm), the lowest production level since 2017, figures from the Joint Organisations Data Initiative (JODI) show. -Reuters