Egypt’s energy sector proved largely resilient to the initial impact of the Covid-19 pandemic, when demand for fuel and feedstock dropped amid lockdowns and travel restrictions. Heavy investment in the industry, new oil and gas discoveries, and a strong refining industry now place Egypt in an advantageous position to capitalise on the resurgence of global travel and economic activity. In addition to redeveloping its oil and gas operations, Egypt is expanding its renewable energy and nuclear segments as a means of diversifying the energy mix and decarbonising the economy.

Structure & Oversight

Oversight responsibilities for the energy sector are distributed across several government agencies. The Supreme Energy Council (SEC), which was established in 1979 and most recently reformed in 2014, controls the pricing, regulations and development of the sector. The Ministry of Petroleum and Mineral Resources (MPMR) is responsible for the exploration, production and distribution of oil and gas. It conducts many of its oversight and management activities through five state-owned enterprises (SOEs): the Egyptian General Petroleum Corporation (EGPC), the Egyptian Natural Gas Holding Company (EGAS), the Egyptian Petrochemicals Holding Company (ECHEM), the Egyptian Mineral Resources Authority (EMRA) and Ganoub El Wadi Petroleum Holding Company (Ganope).

The Ministry of Electricity and Renewable Energy (MERE) manages electricity through its subsidiary the Egyptian Electricity Holding Company (EEHC). MERE also manages the New and Renewable Energy Authority (NREA), the Egyptian Electric Utility and Consumer Protection Regulatory Agency (EgyptERA), the Hydro Power Plants Executive Authority, the Nuclear Power Authority and the Atomic Power Plants Authority to manage power and renewables.

Key Sector Metrics

Egypt is the largest oil producer in Africa that is not a member of the Organisation of the Petroleum Exporting Countries (OPEC), as well as the third-largest natural gas producer on the continent. The country’s oil output of 616,000 barrels per day (bpd) in 2020 – down from 653,000 bpd in 2019 due to the pandemic – placed it 24th worldwide, according to the “Statistical Review of World Energy 2021” by BP.

In FY 2019/20 Egypt’s oil and gas sector contributed 24% to GDP, with a sector growth rate of 25% in 2020 due to gas self-sufficiency efforts. Government agencies and international oil companies (IOCs) have invested heavily in Egypt’s hydrocarbons in recent years, with the industry receiving financing of some $74bn between FY 2014/15 and FY 2019/20.

As part of an economic relief package from the IMF following the 2011 revolution, Egypt agreed to reduce energy subsidies to reduce spending and encourage greater foreign investment in the sector. There are over 60 IOCs currently operating in Egypt, including BP, Chevron, ExxonMobil, Eni and Royal Dutch Shell. In addition to its reserves, Egypt’s location offers a strategic advantage in energy trade, as the Suez Canal is a major transit route between Europe and Asia, helping Egypt to attract private investment. Moreover, the Suez-Mediterranean Pipeline (Sumed pipeline) runs across Egypt, transporting oil between the Mediterranean Sea and the Red Sea.

The renewables segment has become a important contributor to Egypt’s energy supply in recent years. At the COP26 UN Climate Change Conference in 2021, Tarek El Molla, the minister of petroleum and mineral resources, announced that Egypt had moved up its renewable energy target, intending to produce enough green energy to cover 42% of the country’s electricity demand with renewables by 2030. In Egypt’s Integrated Sustainable Energy Strategy (ISES), published in 2014, the target was initially set for 2035; however, a 2018 report by the International Renewable Energy Agency suggested that Egypt could reach this goal sooner with new policies and by investing more in the segment.

President Abdel Fattah El Sisi has highlighted the importance of diversifying energy sources to enhance the country’s energy security as the population and energy demand continue to grow. As of mid-2022 hydropower was the leading source of renewable energy, followed by solar and wind power.

In terms of coal, the majority of Egypt’s reserves are located in Sinai, with an estimated 17.6m tonnes in 2016. However, Egypt has not been producing coal in recent years and has scrapped plans for large coal plants.


Egypt was once a regional leader in liquefied natural gas (LNG) production and exported the commodity as well, but the country came to rely on gas imports in 2015 following a slowdown in exploration and production activities by several IOCs. The government worked to ease the situation by introducing the Law for Gas Market Activities Regulation in 2017 and establishing the Natural Gas Regulatory Authority to implement the law. The law sought to liberalise midstream and downstream gas activities, allowing private companies to sell gas in the domestic market and encourage greater private investment across all operations in the gas segment.

In the years since, broader plans to make the hydrocarbons sector more competitive have been under way. “The sector modernisation programme being undertaken by the government, including the launch of Egypt Upstream Gateway for digital bidding, has created a positive investment environment for IOCs,” David Chi, vice-president of US oil and gas company Apache, told OBG. The gateway was used to award exploration concessions in early 2022 (see analysis).


Egypt’s upstream oil and gas market is forecast to expand at a compound annual growth rate (CAGR) of 8% between 2019 and 2027, according to Mordor Intelligence. The country is 16th in the world for natural gas reserves, at approximately 2.1trn cu metres. This puts Egypt in a good position to further develop the segment, as global demand for gas is high. In 2019 gas was the fastest-growing energy segment locally – a trend that is likely to continue with favourable policies and a strong investment framework.

Natural gas production totalled 58.5bn cu metres in 2020 and rose by 17% in 2021. The sales value of LNG exports hit a 10-year high in 2021, fuelled by an increase in production from the Idku facility near the North Coast and a high-price environment: Egypt recorded $3.9bn from 6.8m tonnes, compared to $600m in 2020. Around 63% of the volume went to Asian markets – primarily China – and 31% went to European markets, including Turkey. The rise in production and export activity was largely thanks to the reopening of the 5m-tonne-peryear Damietta SEGAS facility in February 2021 after an eight-year hiatus. The plant is operated by Italy’s Eni.

The discovery of three offshore gas fields in 2015 led to a notable boost in Egypt’s production so the country could return to its status as a net exporter of LNG. The El Zohr gas field, discovered by Eni, is thought to be one of the largest of its kind in the Mediterranean region, with estimated reserves of 30trn standard cu feet (scf). Eni began recovering the gas in 2017 and achieved full production capacity of 2.7bn scf per day (scfd) by 2019. The Atoll gas field in the East Nile Delta, discovered by BP, provides 5% of Egypt’s daily gas output. Pharaonic Petroleum, which manages operations at the field, achieved peak production in 2020 – around 400m scfd. The firm has recovered 21% of the field’s total recoverable reserves and expects Atoll to be operational until 2051. The Nooros gas field in the Nile Delta was developed by owner BP and operator Eni within the same year of its discovery. It reached peak production in 2018, at 1.2bn scfd and 5730 bpd of natural gas liquids, with output expected to continue until 2043.

In terms of oil operations, most crude is extracted from the Gulf of Suez and Western Desert basins. The country had 3.1bn barrels of proven crude reserves at the end of 2020, according to BP, substantially less than the estimated 4.4bn barrels in 2009. In December 2021 domestic oil consumption averaged 705,000 bpd, meaning that the current output of 639,000 bpd falls short of needs, making Egypt a net importer of oil. Indeed, Egypt’s oil output has fallen in recent years, from an average of 726,000 bpd in 2015. However, several recent discoveries offer an optimistic outlook for the next decade, particularly as Russia’s invasion of Ukraine in February 2022 has destabilised global energy markets and prompted buyers in Europe and North America to look elsewhere to shore up supply.

In 2021 upstream oil and gas firms made 52 discoveries – 39 for crude oil and 13 for gas – in the Western Desert, Mediterranean, Gulf of Suez, Sinai and Eastern Desert regions. In October of that year, Eni announced three discoveries containing an estimated 50m barrels of oil equivalent in the Western Desert. The finds have a forecast output of 1500 bpd. Other IOCs have been similarly successful (see analysis). “Recent discoveries and the drilling of new fields are indicative of the continual development of Egypt’s upstream segment,” Chi told OBG. “As Egypt’s fields mature, deploying technologies that enable more efficient exploitation and extraction to prolong the production life of fields will become increasingly important.”


Egypt’s downstream market is forecast to grow at a CAGR of more than 5% between 2021 and 2026 on the back of conducive policies and greater private participation to meet demand. The demand for refined petroleum products has risen with the development of the economy. In 2020 Egypt’s refinery throughput surpassed 600,000 bpd for the first time, making it the top oil-refining country in Africa. However, given the age of the refineries, there is scope for refurbishment. More investment is needed to transform Egypt’s refineries into facilities capable of producing high-end petroleum products such as diesel and liquefied petroleum gas.

There has been heightened interest in the refining industry alongside the development of the upstream hydrocarbons segment. In 2018 state-owned Engineering for the Petroleum & Process Industries (ENPPI) signed an agreement with the Assiut National Oil Processing Company and Italy’s Technip for the construction of a $1.9bn refinery. It is expected to have the capacity to process 2.5m tonnes of the heavy fuel oil mazut annually to produce 400,000 tonnes of naphtha for gasoline, 1.6m tonnes of Euro-5 diesel, 330,000 tonnes of sulphur and 100,000 tonnes of butane.

More recently, in October 2021 ENPPI, Petrojet and the Assiut Oil Refining Company signed a memorandum of understanding (MoU) worth LE6bn ($379m) to construct an atmospheric distillation unit at the Assiut refinery that will expand throughput capacity to 5m tonnes of crude oil annually. Egypt is carrying out multiple large-scale refining and petrochemicals projects with the goal to achieve self-sufficiency in refined oil products in 2023. In February 2022 Saudi Aramco signed an agreement to supply 100,000 bpd of crude to the Red Sea National Refining and Petrochemical’s refining complex, set to come online by the end of 2024. The 60,000-bpd expansion of the MIDOR refinery began pilot operations in May 2022, will boost the facility’s capacity to 160,000 bpd.


The Sumed pipeline, which was expanded in 2015, is Egypt’s principal transit medium for oil and LNG. Construction began on a new gas pipeline in the Western Desert in October 2021, which EGPC is managing. The pipeline is set to transport 15m scfd.

In February 2022 Egypt and Israel announced they are planning a subsea pipeline to double the amount of gas that Egypt imports from Israel. Since 2020 gas has been arriving through a pipeline that connects overland across the Sinai Peninsula to be liquefied at the Idku and Damietta facilities and then re-exported. The two countries are hoping for investment from IOCs to build a pipeline with an annual capacity of 10bn cu metres from Israel’s Leviathan offshore field by early 2024.


In line with boosting gas output over the last half decade through the development of the El Zohr, Atoll and Nooros gas fields, Egypt has also increased its export levels. By the end of 2021 the country was exporting LNG at full capacity – 1.6bn scfd – from its two natural gas liquefaction terminals in Idku and Damietta. In 2022 the MPMR expects to export between 60m and 65m scfd to Lebanon through the renovated Arab Gas Pipeline. Indeed, there is significant potential for Egypt to further develop its LNG export market. For example, shortages across Europe in 2021 highlighted the continent’s reliance on gas as the main energy source. In addition, the rise in gas prices during 2021 and into 2022 means Egypt will likely achieve higher revenue from its exports in 2022, regardless of destination.

Fuel exports accounted for 17.6% of Egypt’s total merchandise exports in 2020. The following year the petroleum sector’s export revenue increased by 84.3% to $12.9bn, according to the MPMR. Within this, export revenue from gas reached $3.9bn – roughly a fivefold increase – while crude exports totalled $3.3bn, marking a 32% increase. Exports of petrochemicals, chemicals and fertilisers grew by 45% to $6.7bn.

Although Egypt no longer imports gas to meet its domestic needs, the MPMR signed an MoU in November 2021 with Greece and Israel to import Israeli gas to the Idku and Damietta plants in order to re-export LNG to Greece. This builds upon an existing $19.5bn agreement signed in 2019 that will see Egypt import 85.3bn cu metres of Israeli gas for liquefaction through to 2034. Crude oil continues to be imported to cover local needs, with an average of 221,000 bpd imported in 2020.

In another important move, in June 2022 Egypt signed an agreement with Israel and the EU to ship Israeli gas to Europe via Egypt, where it would be pressurised and liquefied before being sent onwards. The deal highlights the important role the Eastern Mediterranean in general and Egypt specifically could play as Europe works to diversify its energy imports away from Russia.


There is a wide spectrum of renewable energy produced in Egypt that includes solar, wind, hydropower and biomass, while plans for nuclear energy – considered sustainable by some as it does not release greenhouse gasses – are in the works. Under ISES 2035, Egypt has been working towards becoming a renewable energy centre for MENA and Europe by expanding grid interconnections. The government has invested heavily in renewable energy, as well as attracted foreign investment, which has helped it move its renewable energy output target forwards. The next UN Climate Change Conference, COP27, will be held in Sharm El Sheikh in November 2022 and is expected to drive greater investment in the industry. Renewable power generation capacity is forecast to rise from 3.5 GW in 2020 to 13.7 GW by 2030 for a CAGR of 14.6%, according to GlobalData. However, the country had not announced a net-zero carbon emissions pledge as of mid-2022.

“Part of the government’s vision for achieving energy security and sustainability is directing investment to wind and solar power, as well as to nuclear energy,” Ahmed Ramadan, CEO of Power Generation Engineering and Services Company, told OBG. “For distribution, it is important to increase efficiency of the network, where approximately 20% of power is lost. Technology is key to limiting losses at the distribution stage.”


The solar segment has grown substantially since the inauguration of Egypt’s first solar farm in 2014. The 800-MW Benhan Solar Park Benban is among the largest solar photovoltaic (PV) parks in the world, located in Aswan in the global sunbelt, which receives 2000-3000 KWh per sq metre of direct solar radiation annually. Building on the developments of the past eight years, Egypt’s total solar PV capacity is forecast to rise from 2 GW in 2020 to 7.7 GW by 2030.

In line with Egypt Vision 2030, 126 solar power stations were established between mid-2019 and mid-2021. In April 2021 the European Bank for Reconstruction and Development , the OPEC Fund for International Development, the African Development Bank, the Green Climate Fund and Arab Bank agreed on a $114m deal with Saudi Arabia’s ACWA Power to construct the largest private solar energy plant in Egypt, Kom Ombo. Located 20 km from Benban, it is expected to add 200 MW to the country’s output and promote private participation in the segment. No timeline for the project’s completion had been established as of June 2022.


The average wind speed in the Gulf of Suez is 10.5 metres per second, making it ideal for wind energy developments. Egypt aims to boost its cumulative onshore wind capacity from 1.4 GW in 2020 to 5.6 GW by 2030. The country already has several large-scale wind farms, built with investment from partners from Denmark, Spain and Japan. Most of Egypt’s wind power plants are operated by the NREA, while there is one private 250-MW wind farm. The West Bakr wind farm in the Gulf of Suez, developed by Siemens Gamesa and Lekela, began operations at the end of 2021.

In October 2021 MERE and a consortium of foreign energy firms signed two agreements for the construction of a 500-MW wind farm in the Gulf of Suez at an estimated cost of $600m. The farm is expected to become operational by 2024, and the Egyptian Electricity Transmission Company will purchase the electricity.


Egypt has an estimated 2.9 GW of hydropower capacity. However, the segment faces an uncertain future due to the Grand Ethiopian Renaissance Dam (GERD), and the rising dominance of other sources of energy. Negotiations regarding the dam have been ongoing since 2011, but are currently at a standstill. Should the GERD be filled as planned, water flowing into Egypt would be significantly limited.

In response to the GERD, the Egyptian government is planning to overhaul the hydropower stations of its dams in the Aswan governorate to improve efficiency. It plans to replace 12 turbines in the Aswan High Dam and seven in the Low Dam at a cost of $48m with financial support from the German Ministry for Economic Cooperation and Development. As of 2021 the High Dam power station produced about 2.1 GW, but this could drop by 10-20% as the GERD becomes operational.


There is considerable potential to develop the biomass energy segment, seeing as there is around 35m tonnes of agricultural waste per year that could be used for biofuel. However, using biomass to generate electricity is expensive, meaning that there has been little interest in developing such operations. Nevertheless, in August 2021 the government announced a $2m investment to build various new biomass power plants with international investors. The plants are expected to have the capacity to transform 600 tonnes of waste per day into power for local populations.


Egypt has turned its oil and gas industry around in the years since 2015, when the country became a net importer of natural gas. In doing so, it has created an environment where opportunities abound. For example, the award of new exploration licences for 2022 means there is the potential for further discoveries (see analysis). The opening of new transport routes for hydrocarbons will also help the country become a global energy centre connecting Europe, MENA and Asia. At the same time, plans to grow the renewable energy sector with additional wind and solar farms should lead to greater energy security and allow the government to meet the needs of a large population.