Egypt Awards LNG Tender to Four Overseas Firms

Egyptian Natural GasHolding Company (EGAS) has awarded a $2.2 billion tender to import 75 cargoes of LNG to four international firms, news agency Reuters reported Sunday.

The four companies will supply four cargoes a month over about two years, Khaled Abdel Badie of state-run Egyptian Natural GasHolding Company (EGAS) told Reuters.

Abdel Badie did not identify the four companies.

The tender process which was launched in October last year saw offers from BP, Vitol, Trafigura, Golar LNG, and three other companies, Daily News Egypt reported last month.

The Egyptian economy is facing severe gas shortage as local demand has ballooned in recent years amid declining domestic production. Cairo has been looking to source the fuel from various sources. 

In December, Algeria and Egypt signed a previously announced natural gas deal. According to Egypt's Minister of Petroleum, as per the deal Algeria will supply 850,000 cubic meters of LNG in six shipments to Egypt during 2015. The two countries will begin fresh talks shortly regarding supply of Algerian gas during 2016-2020, the ministry said adding that negotiations will start in Cairo and will be completed by February in Algiers.

Cairo is also expected to sign a deal to import LNG from Gazprom. Egypt is likely to buy 35 shipments of LNG over the next five years from the Russian company. Shell is another company likely  to begin supplying gas to Egypt this year.

To ease the import process, Cairo signed a FSRU deal last year.

Late last year, Norway’s Hoegh LNG finalised a five year deal with Egyptian Natural Gas Holding Company (EGAS) to supply FSRU by the end of first quarter of 2015.

In May last year, Höegh LNG signed a Letter of Intent (LOI) with EGAS for the use of one of its FSRU as an LNG import terminal in the port of Ain Sokhna, located on the Red Sea's Gulf of Suez.

The FSRU was scheduled to start operations in the third quarter of 2014 but was delayed.