Egypt is in talks with Germany to lease a liquefied natural gas (LNG) unit. The move aims to boost supplies before summer demand increases.
An Egyptian delegation will travel to Germany this month to finalize the deal, according to the Oil Ministry. The unit is currently at the Mukran terminal on the Baltic Sea. If the agreement is reached, the floating unit will be relocated to Egypt. However, officials have not provided a timeline.
Egypt, once a major LNG exporter, began importing gas last year. A sharp drop in local production and rising electricity demand led to severe power shortages. This shift puts Egypt in competition with Europe, which is also increasing LNG imports to replace lost Russian supplies.
In addition to leasing the unit, Egypt and Germany are discussing a plan for Germany to buy Cypriot gas. If approved, the gas will be processed at Egypt’s liquefaction plants.
To secure more gas, Egypt has taken several steps. It leased a floating LNG terminal at Ain Sokhna last year. Another facility from Jordan is set to start operations in mid-2025. Meanwhile, Egypt is discussing the construction of a new LNG facility with Italian energy firm Eni SpA.
Rising demand and declining production have turned Egypt into a net importer. A foreign currency shortage has delayed payments to energy firms, slowing investment in gas production. To address this, Egypt plans to pay off debts in monthly installments. The government hopes to stabilize the sector and resume LNG exports by late 2027.