Why our gas sector is leaning heavily on LNG imports
Egypt’s energy challenge is characterized by a widening gap between declining production and rising demand, but the government is working to stabilize the sector. The Oil Ministry is making good on its debts to international oil companies, announcing last week that it will fully settle these arrears by 10 June, ahead of its original end-of-June target. The dues had already been slashed to USD 440 mn in May from USD 714 mn at the end of April, down from a peak of USD 6.1 bn on 30 June 2024.
By the numbers: Egypt imported nearly 6 bcm (c. 2.35 bcf / d) of natural gas in 1Q 2026, a 36% y-o-y increase, according to the latest figures from the Joint Organizations Data Initiative (Jodi) (pdf). Combined with 9.85 bcm (c. 3.87 bcf / d) of domestic production, these imports accounted for 38% of Egypt’s total available gas supply — a sign the country is increasingly relying on shipments to balance the local market.
The data also shows a sharp shift in our import mix, which tilted heavily toward LNG during the quarter. LNG inflows more than doubled, jumping 131% y-o-y to 4.3 bcm (c. 1.7 bcf / d), while pipeline gas imports dropped 34% y-o-y to 1.7 bcm (c. 670 mmcf / d).
The macro picture
The country’s gas balance has deteriorated markedly, with domestic production falling nearly 30% from 2023 to 2025. Domestic gas production fell from 15.55 bcm in 1Q 2023 to 13.43 bcm in 1Q 2024, 10.68 bcm in 1Q 2025, and 9.85 bcm in 1Q 2026. Across these four consecutive first-quarter periods, output declined by nearly 37%, equivalent to a compound annual decline rate of about 14%.
Annual gas production fell from nearly 59 bcm (c. 5.7 bcf / d) in 2023 to 50 bcm (c. 4.8 bcf / d) in 2024 and 42 bcm (c. 4.1 bcf / d) in 2025 — a loss of nearly 17 bcm (c. 1.6 bcf / d) of annual output in just two years. Overall, production declined by 29% over the period, averaging a 15.4% annual drop.
What’s driving the decline? The gas sector faced a combination of challenges, including natural field depletion, delayed investments, and slower development activity following years of mounting arrears. Zohr — Egypt’s largest gas field which accounts for roughly 30% of the country’s total natural gas output — has seen its production slide to around 1.2 bcf / d from a 2019 peak of 3.2 bcf / d.
Imports are a pricey solution
Gas imports rose as domestic supply weakened. On a quarterly basis, imports increased for four consecutive first quarters — from 2.2 bcm in 1Q 2023 and 2.6 bcm in 1Q 2024 to 4.4 bcm in 1Q 2025 and 6 bcm in 1Q 2026. That represents a cumulative increase of nearly 172% between 1Q 2023 and 1Q 2026, with a compound annual growth rate of 39%.
Imports climbed from nearly 8.5 bcm (c. 300 bcf) in 2023 to 14.6 bcm (c. 516 bcf) in 2024 and 22.2 bcm (c. 786 bcf) in 2025. The country added roughly 13.7 bcm (c. 483 bcf) of annual imports over the period — a cumulative 159% increase to keep the lights running, growing at a compound annual rate of 61%.
Filling the gap comes at a growing financial cost. Natural gas made up 45% of our fuel import bill in 1Q, totaling USD 2.5 bn between January and March. Our natural gas import bill is set to jump 26% y-o-y to USD 10.7 bn in the next fiscal year to cover both LNG cargoes and pipeline gas.