The Egyptian government has announced its plan to jointly explore the acquisition of a Floating Storage and Regasification Unit (FSRU) with Jordan. The two countries aim to contract with a global company for the manufacturing of the unit, which will receive shipments of liquefied natural gas (LNG), regasify it, and feed it into the national grid.

In May, Egypt, through the Egyptian Natural Gas Holding Company (EGAS), contracted with the Norwegian company Hoegh LNG to lease the “Hoegh Galleon” FSRU until February 2026. This move aims to secure additional gas supplies for domestic consumption during the summer months, according to a statement from the Ministry of Petroleum.

Regasification is the process of converting LNG back into its gaseous state for direct consumption.

In a related development, Egypt has launched a new tender to import five shipments of LNG in August and September as part of its efforts to address the country’s electricity shortage crisis.

Natural gas production in Egypt currently stands at 4.6 billion cubic feet per day, its lowest level in years. In 2022, production reached 59.29 billion cubic meters, the lowest level since 2017, representing a year-on-year decrease of 11.5%, according to figures from the Joint Organizations Data Initiative (JODI).

Since April 2023, Egypt has been purchasing LNG shipments in a rare move to avoid power outages. EGAS recently purchased several spot LNG shipments for delivery to the Aqaba regasification terminal in Jordan before being transported via pipelines to Egypt.