Egypt is in advanced talks with Qatar to secure liquefied natural gas (LNG) cargoes for 2026 and expects a stalled $35 billion Israeli gas import deal to restart as early as January, petroleum ministry sources told Al Manassa.
The moves are part of Cairo’s push to plug a growing gas supply gap, curb an import bill that has almost doubled in a year, and avoid a repeat of the 2024 summer power cuts. Officials say Egypt is seeking to diversify suppliers while locking in long-term Israeli pipeline gas at relatively attractive prices compared with spot LNG.
The dual track of Qatari LNG talks and the pending Israeli agreement also underscores the growing role of gas in Egypt’s regional diplomacy, involving Gulf partners, Israel, and the United States at a time of strained ties between Cairo and Tel Aviv over the Gaza war.
Qatar LNG talks for 2026
A source familiar with the import portfolio at the Ministry of Petroleum said there are advanced negotiations with several partners, led by Qatar, to contract LNG cargoes to meet domestic demand in 2026.
The source, who requested anonymity, said Cairo is turning to Qatar as a precaution “against any possible disruption in gas supplies, whether from Israel or from flat domestic production levels, especially given the continuous increase in local gas consumption.”
The source added that the domestic market will need more than 120 LNG cargoes next year, about 75% of them for the summer months, and that “it is essential to diversify the sources of these imports to guarantee stable supplies and avoid any potential shortfall.”
The value of LNG imports rose to about $7.2 billion over the past 10 months, compared with $3.85 billion in the same period last year, an 87% increase, according to a source familiar with the imports file at the ministry in earlier comments to Al Manassa.
Israeli supply deal expected to restart
A second informed official said the $35 billion deal to import Israeli gas to Egypt is expected to be finalized within a week, with a possible price adjustment of no more than $1 per million British thermal units (mmbtu) in Israel’s favor.
One month after the announcement in August of an amended Israeli gas agreement to raise supplies to 130 billion cubic meters through 2040 in return for $35 billion, Israeli Prime Minister Benjamin Netanyahu said implementation was being halted, accusing Cairo of violating the Camp David peace treaty by deploying forces along the border with Israel.
The second source, who also requested anonymity, expected the agreement to enter into force at the beginning of January, saying US company Chevron had played a pivotal role by linking its expansion plans in the Leviathan field to the Israeli government’s approval of gas exports to Egypt.
Under the original contract, Israel was to export nearly 60 billion cubic meters of gas to Egypt until 2030. The August amendment extended the relationship to 2040 and obligated Israel to export 130 billion cubic meters.
The source said Israel had sought a price increase of about $2 to $3 per mmbtu, but the Ministry of Petroleum rejected this, leaving the average price of imported Israeli gas at about $7.7 per mmbtu “before any increase,” a price the source described as attractive for both sides.
The 2019 export agreement links Israeli gas prices to global Brent crude. The latest amendment kept the same pricing mechanism, with some changes related to later phases of the agreement. According to press reports, the current price of gas stands at about $7.7 per mmbtu.
This week, US officials and an Israeli source, all unnamed by the Axios news site, said the White House is ready to mediate a summit between Netanyahu and President Abdel Fattah El-Sisi, who have not spoken since before the war in Gaza.
But they said Netanyahu must first agree to a strategic gas deal with Egypt and take other steps to entice El-Sisi to meet.
LNG prices and Egypt’s supply gap
A third source familiar with the import file at the state-owned Egyptian Natural Gas Holding Company (EGAS) said current LNG prices range between $12 and $14 per mmbtu, in addition to variables related to payment periods when agreeing terms with partners.
The source said the ministry aims to bring LNG prices down in 2026 in line with expected global price declines, and that the new price could reach around $10 per mmbtu, compared with $12 to $14 previously.
The source added that the ministry will continue contracting for LNG cargoes until Egypt reaches self-sufficiency and raises domestic production to 7 billion cubic feet per day to close the gap between output and consumption. Current production stands at about 4.2 billion cubic feet per day, compared with winter consumption of between 6.2 and 6.3 billion cubic feet per day, leaving a gap of nearly 2 billion cubic feet per day, the source said.
New Nile Delta discovery and lingering deficit
Separately, UAE-based Dana Gas said Thursday it had successfully drilled the North El-Basant-1 exploration well in Egypt’s onshore Nile Delta, with initial results indicating gas reserves of 15 billion to 25 billion cubic feet and expected output of at least 8 million cubic feet per day once tied into the grid.
The new well is the fourth in a recent exploration campaign in Egypt, and Dana Gas said its drilling and well workover programme has added about 30 million cubic feet per day of gas to national production. Dana Gas chief executive Richard Hall said the company’s investment program in Egypt will save the economy more than $1 billion over the long term.
Egypt reached gas self-sufficiency in 2018 with the Zohr field, which holds about 30 trillion cubic feet of reserves, but output has fallen since 2023, forcing a renewed dependence on imports. Experts estimate a current gas shortfall of around 1.2 billion cubic feet per day and say such small discoveries cannot by themselves fix Egypt’s energy deficit, as the 2024/2025 balance of payments shows petroleum imports hitting record levels amid efforts to prevent a repeat of summer power cuts.
