A trading unit of top Russian oil producer Rosneft has signed a deal to supply 10 liquefied natural gas (LNG) cargoes to the Egyptian Natural Gas Holding Company this year.
Rosneft said that the first delivery by Rosneft Trading SA (RTSA) is expected in May.
The company said,”This agreement will help to further strengthen the strategic partnership between Rosneft and Egypt in an important area of energy security.”
In December 2016, Rosneft CEO Igor Sechin visited Egypt, and said the Russian energy firm and EGAS are interested in extending cooperation in LNG deliveries.
Egypt, which was once an energy exporter,has become a net importer because of declining oil and gas production and increasing consumption.
Accordingly, Egypt is trying to speed up production at recent discoveries to fill its energy gap as soon as possible.
Rosneft does not produce its own LNG yet but plans to launch production jointly with Exxon Mobil later this decade.
The company declined to comment on the sourcing of the LNG cargoes for Egypt.
Last February, Al-Ahram , an Egyptian state-owned newspaper, cited the Egyptian oil minister saying that Egypt has signed a $1 billion contract with three international companies to import 45 shipments of Liquefied Natural Gas (LNG).
Local natural gas company EGAS will buy 45 shipments from the multinationals, according to Egypt’s state-owned newspaper Al-Ahram.
In fact, Egypt produced enough LNG to cover its needs and also exported LNG to Israel and Jordan before January Revolution 2011. However, after the revolution, LNG exports fell by nearly 75%, as reported by US Energy Information Administration.
The demand for LNG has steadily grown while the country was forced to slash oil and gas exploration work. Egypt plans to reduce gas imports in the next two years, as it rebuilds infrastructure.