Egypt Signs $2.7 Billion LNG Deal With Shell, Total to Secure Gas Supplies

Egypt has renewed long-term liquefied natural gas (LNG) supply agreements with Shell and TotalEnergies, contracting 60 new cargoes worth an estimated $2.7 billion as the country moves to bridge a widening gap between domestic production and rising consumption, a senior government official told Bloomberg.

Under the agreement, Egypt will receive five LNG cargoes per month starting in January, with deliveries spread across 2026 to meet local demand. The price of each shipment will be calculated at prevailing global LNG prices at the time of delivery, with an added premium reflecting a payment grace period of up to one year, the official said, requesting anonymity due to the sensitivity of the negotiations.

The deal comes as Egypt increasingly relies on imported gas after natural declines in output from mature fields pushed domestic production down to around 4.2 billion cubic feet per day, well below average demand of 6.2 billion cubic feet, which rises to about 7.2 billion cubic feet during summer months.

According to the official, the initial cargoes are priced at $10–$12 per million British thermal units (MMBtu), down from an average of roughly $13/MMBtu in 2025, reflecting easing global gas prices.

Each shipment carries between 160,000 and 165,000 cubic metres of LNG, enough to supply roughly 500 million cubic feet of gas per day to the local market for about a week after regasification.

Shell, responding to Asharq’s inquiry, said its export plans for 2026 remain under review and declined to comment on specific contractual arrangements.

Egypt imported between 155 and 160 LNG cargoes in 2025 to cover the shortfall between production and consumption, highlighting the scale of its growing dependence on overseas gas. Officials say LNG imports will likely continue until at least 2030, even as the country works to stabilise output and attract new upstream investment.

To support this strategy, Cairo has expanded its regasification infrastructure. Three floating storage and regasification units (FSRUs) are currently operating at Ain Sokhna with a combined maximum capacity of about 2.25 billion cubic feet per day, alongside the Energos Winter vessel at Damietta, which can process up to 450 million cubic feet per day.

Once a net exporter of gas following discoveries such as Zohr, Egypt has been forced back into the LNG market as production declines outpaced new developments. The latest agreements with Shell and TotalEnergies underscore the government’s focus on securing flexible supply amid volatile global energy markets, while buying time to rebalance domestic production and consumption.

For now, the $2.7 billion deal reflects a pragmatic approach: locking in volumes, spreading payment obligations, and ensuring energy security as Egypt navigates a challenging phase in its gas sector.