Underwater gas pipeline lights up the energy dreams of the Egyptian region

The Arab Republic of Egypt plans to use its vast newly mined submarine gas reserves to establish itself as a major energy exporter and revive its declining economy.

Cairo, the capital of the country, recently signed gas agreements with Israel, Cyprus, Greece and Jordan. This is motivated by the discovery of huge deposits of natural gas in the Mediterranean. Osama Kamal, former oil minister, said Egypt was planning to become a regional energy hub.

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Strengthen the country's economy

The gas began to flow from four main deposits on the Mediterranean coast of Egypt, including that of Zohr, the largest gas field in Egyptian waters, inaugurated by President Abdel Fattah Al-Sisi during the past year.

Gas has changed the game for the country after the financial crisis that drove Cairo in 2016 to take out a $ 12 billion loan from the International Monetary Fund. Egypt's budget deficit, which accounted for 10.9 percent of GDP in fiscal 2016-17, has since fallen to 9.8 percent. Since September, Egypt has been able to cut liquefied natural gas imports, which last year cost it $ 220 million.

Cairo, which has responded to its own needs, seeks to revive exports and expand its regional influence. It has signed agreements to import gas from neighboring countries for the liquefaction of facilities on its Mediterranean coast, ready for re-export to Europe.

Egypt's energy-related energy ambitions are not limited to the natural gas sector, but also include major projects in the petroleum and petrochemical sectors. Tarek El Molla, Minister of Petroleum and Mineral Resources, recently announced an agreement to expand the Midor refinery in the Egyptian capital to increase production by 60%.

In addition, the Mostorod refinery is expected to produce 4.4 million tonnes of petroleum products a year after it goes online next May. That alone will save the state $ 2 billion a year in petrochemical imports, which cost it $ 5.2 billion last year. Egypt is also investing in a Red Sea processing plant that can produce 4 million tonnes of petroleum products a year and create 3,000 jobs in the country.

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