Egypt issues new tender as LNG imports bring relief

EGPC seeks another five LNG cargoes

Local industry restarts, power cuts suspended

Egypt to bring in up to 26 cargoes over summer

LONDON (ICIS)–Egypt is in the market for another five LNG cargoes as the country continues to address declining domestic gas production and soaring summer demand.

Egyptian General Petroleum Corporation (EGPC) has issued a TTF-linked DES tender covering 13-14 and 25-26 August and 3-4, 12-13 and 21-22 September delivery windows, traders said on Wednesday.

The two cargoes for delivery in August and the middle cargo in September would be delivered to Egypt’s Ain Sukhna terminal, while the first and third September cargoes would be sent to Jordan’s Aqaba terminal for further pipeline delivery.

The tender closes on 29 July at 12:00 noon Cairo time and is valid to 18:00 on the same day.

This is the fourth LNG tender round Egypt has issued covering the summer period this year, as the country has been forced to turn from LNG exports to imports.

EGPC has previously been in the market seeking a total of 22 cargoes in three separate rounds.

All cargoes were reported to have been awarded, expect for the 1-2 September cargo in a two-cargo tender that closed on 22 July, one trader said.

If the latest tender is fully awarded, this could bring a total of 26 spot cargoes into Egypt from mid-June to mid-September.

UREA PRODUCERS RESTART

Latest data from association JODI shows a continued decline in domestic gas production.

Average May production was around 138 million cubic meters (mcm)/day, down from 142mcm/day in April and 163mcm/day in May 2023.

However, the flow of LNG seems to have brought some relief to local industry.

Some Egyptian urea producers shut down for a day last week but then restarted, sources said, with one source attributing the ramp up to LNG imports.

Five cargoes have been delivered since the start of July, according to ICIS data.

As of this week, urea plants in Egypt are running at around 80% capacity on average.

“I believe this will [be sustained] till the end of summer period,” a urea source said.

“Heard also that old electricity stations have started to work with fuel oil as an alternative [for] gas,” they added.

Only one of Abu Qir’s prilled urea lines is down, while its other two lines are running as normal.

The government has also suspended its electricity load-shedding program from 21 July until mid-September, as recently announced by Prime Minister Mostafa Madbouly.

The Prime Minister said the power cuts halted after the arrival of some LNG cargoes.

The cuts were introduced last summer and resulted in daily two-to-three hour power cuts across most of the country.

Additional reporting by Deepika Thapliyal.