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Egypt: Chasing the Levantine Gas Market
November day, 2001
Summary
Egypt is working to secure export markets that will accommodate its booming natural gas sector. Pressure from the global economic slowdown and a drop in world energy prices will block Cairo's aspirations in the short term. But its abundant reserves, location, developed economy and political clout in the Muslim world will make it a regional market leader in the future.
Analysis
Cairo is in negotiations to sell natural gas to Syria and Cyprus, the Associated Press reported Oct. 19. The negotiations are part of the government's efforts to establish a network of natural gas pipelines linking Egypt to Jordan, Syria, Lebanon and possibly Cyprus and Turkey.
Egypt has embarked on a two-pronged strategy to capture the Levant's emerging natural gas market and become a top supplier to Europe. The global economic slowdown and a drop in world energy prices will temporarily hinder its plans. But Egypt's burgeoning reserves, location, established economy, political stability and leadership in the Arab world ultimately will make it a strong contender for the Levantine and European energy markets.
Cairo's strategy centers on capturing export markets and developing its natural gas reserves. Since the late 1990s, the state-directed Egyptian General Petroleum Corp. (EGPC) has negotiated a number of export deals with neighboring states. At the same time, a host of multinational energy companies including BP Amoco, ENI-Agip and Shell have raced to begin production from new natural gas fields and build liquification plants. Both measures will make Egypt a key competitor for other natural gas producers -- such as Algeria, Iran and Russia -- that are interested in the region's market.
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Dan
Egypt: Chasing the Levantine Gas Market . . .