Egypt counts on foreign funds to buy gas as power crisis worsens
Saudi Arabia and Libya have financed the purchase of gas cargoes worth at least $200 million to help Egypt ease its energy crisis this summer amid a steep decline in domestic gas output, two industry sources familiar with the matter said.
Egypt needs some $2 billion worth of gas to cover summer demand through October, according to one of the two sources familiar with the government's plan, but a hard currency crisis means it lacks funds to fully cover imports of liquefied natural gas.
"Without support from our friends in the Gulf, we won't be able to pay for these shipments," one of the sources said. He added officials were looking to raise more money from allies.
The two sources said Saudi Arabia had financed three of the 32 LNG cargoes Cairo has bought so far this year, which according to Reuters calculations are worth around $150 million at current prices.
Libya bought one cargo in July worth around $50 million with funds of the Libyan National Oil Corporation, the sources added. Egypt’s gas bill and funding from Saudi Arabia and Libya have not been previously reported.
A spokesperson for Egypt's petroleum ministry said gas tender details were confidential. The Saudi government, Saudi Arabia's central bank and Libya's state energy firm NOC did not respond to Reuters' requests for comment.
Saudi Arabia and the United Arab Emirates have poured tens of billions of dollars into Egypt to support President Abdel Fattah Al-Sisi, who they view as an important ally.
Egypt has had to resort to load-shedding in the last year to keep its grid functioning amid a lack of gas supply and rising demand, and the deepening energy crisis is straining Cairo's budget as it grapples with a heavy subsidies bill.