Gas find puts Egypt on road to self-sufficiency

Significance

The country's energy outlook has been transformed by the discovery of a huge natural gas field in Eni's Shorouk concession along Egypt's maritime border with Cyprus, announced by the Italian oil major on August 30. If Eni's estimates are accurate, the field will increase Egypt's gas reserves by almost half and mean Egypt can regain natural gas self-sufficiency in the 2020s.

Impacts

• The economic impact will depend on the progress of energy reforms, including subsidy cuts and structural changes to the electricity sector.
• The gas discovery will make Egyptian companies drive a harder bargain in negotiations with firms seeking to export Israeli gas.
• The find should generate savings on fuel imports, boosting both Egypt's balance of payments and energy-intensive industries.
• It will encourage power sector investors by guaranteeing the availability of enough natural gas to fuel their new plants.