Cairo – July 21, 2024: Soaring power demands and operational challenges have led to Egypt’s natural gas (NatGas) production levels to plummet to its lowest levels in over 6 years, according to data from the Joint Organizations Data Initiative (JODI), with the country’s natural gas output in May falling to its weakest since February 2018.
The drop in production was partially attributed to operational challenges at Egypt's largest gas field, Zohr in Port Said, where output has reportedly dropped by one-third since 2019 due to issues like water infiltration, explained a report from Eni, a key stakeholder in the field.
The country is currently struggling with particularly high demand for power this year with several back-to-back heatwaves leading to increased demand for electricity to power air-conditioning units across the country.
Minister of Petroleum and Mineral Resources, Karim Badawi, recently acknowledged that oil and NatGas production setbacks have also been intensified by financial arrears owed to foreign oil companies, which have hindered exploration and development efforts.
Prime Minister Mostafa Madbouly highlighted on Wednesday that Egypt's daily power consumption surged by 12% compared to the previous year, creating a deficit of 4 gigawatts.
The government plans to accelerate renewable energy projects, the PM noted, aiming to increase the share of electricity generated from renewable sources to 58 percent by 2040 from the current 20 percent.
After weeks of power shortages to reduce the load on generators, Egypt received 5 out of 21 LNG shipments last week to provide the fuel needed for power plants, with Madbouly pledging to pause all state-controlled blackouts starting today until at least mid-September.
Historically, Egypt is a net exporter of NatGas to Europe, supported by both domestic production and imports from offshore fields. However, Egypt rarely exports in the summer months, due to high domestic power demand during this period.
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