Egypt has signed deals worth about $3 billion with Shell and TotalEnergies to secure 60 cargoes of liquefied natural gas (LNG) to cover demand for 2025, three trading sources told Reuters.
The most populous Arab country last year returned to being a net importer of natural gas, buying dozens of cargoes and abandoning plans to become a supplier to Europe following a steep decline in domestic output.
Egypt's domestic supplies fell to a seven-year low in September 2024, data from the Joint Organisations Data Initiative showed, mainly because of lower output from the Zohr gas field and higher power consumption.
The sources, who could not to be named because they were not authorised to speak publicly, said the 60 cargoes would cover most of the country's demand this year.
Shell declined to comment when contacted by Reuters. TotalEnergies and Egypt's petroleum ministry did not immediately respond to a Reuters request for comment.
In November, Reuters reported Egypt was in talks with U.S. and other foreign companies to purchase long-term volumes of LNG as it seeks to cut its reliance on more costly spot market purchases.
To meet demand in the hot summer months when gas is required for air-conditioning, Egypt bought dozens of LNG cargoes on the spot market, where it had to pay a premium between of $1-$2.
Adding to the financial strain on Egypt, which faces a shortage of foreign currency, LNG spot prices have risen in 2025 to an average of more than $14 per million British thermal units (mmBtu) from around $12/mmBtu when Cairo started tendering for LNG.
Egypt in January issued a tender seeking four LNG cargoes for delivery between February and March. It may issue another spot tender later this year, depending on demand, market conditions and prices, one source said.
Domestic gas output is expected to drop by a further 22.5% by the end of 2028, data from consultancy Energy Aspects found. Meanwhile, analysts expect the country's power consumption to increase by 39% over the next decade.
(Reuters - Reporting by Marwa Rashad; Editing by Susanna Twidale, Kirsten Donovan and Barbara Lewis)