Egypt is in talks with energy majors including Shell, TotalEnergies and bp to buy 15 to 18 cargoes of liquefied natural gas per month for at least three years.

The talks come as Egypt's domestic production struggles to keep pace with rising demand and as global LNG markets remain tight during the Iran conflict, which has curtailed shipping through the Strait of Hormuz and increased competition among buyers seeking to secure supplies.

Two of the sources said talks are ongoing with companies including Shell, TotalEnergies, bp and commodities trader Hartree Partners.

There is "a strong will to work with Americans", a third source said.

The duration of the deals could be three to five years, but they are yet to be finalised, the sources added.

Cost of Egyptian natural gas imports balloons. While Egypt's economy has remained broadly stable despite the U.S.-Israeli war with Iran, energy imports have ballooned.

Egypt's natural gas import bill had nearly tripled, rising from about $560 ​million before the conflict to roughly $1.65 billion for the same volumes in March.

The new import deals could cost the most populous Arab country between $8 billion and $11 billion annually, based on Reuters calculations of recent deals priced at a premium of about $1.5 above TTF, the European gas price benchmark.

This would be an additional challenge for the government, which is already grappling with high debt that eats up the majority of its budget, and a national currency that is barely holding since the regional conflict began.

Every dollar spent on LNG and fuel imports is money no longer available for budget spending, investment or reserves accumulation.

"Egypt's ongoing negotiations for medium-term LNG supply, alongside the expansion of existing and planned pipeline gas agreements, reflect efforts to reduce exposure to volatile spot market procurement amid continued geopolitical uncertainty," said Aly Blakeway, head of Atlantic LNG at S&P Global Energy.

That uncertainty includes the Russia-Ukraine conflict and tensions involving the U.S. and Iran, Blakeway added.

Egypt's gas production declining. Egypt imported a total of 985 billion cubic feet of gas between July 2025 and June 2026, including from Israel and other LNG cargoes.

Its imports are estimated to reach 1,081 billion cubic feet between July 2026 and June 2027, according to official documents.

The higher imports reflect a continued decline in natural gas production, despite repeated pledges and clearing foreign companies' arrears.

Monthly production averaged under 4.4 billion cubic feet per day in fiscal year 2025-26, and is expected to dwindle further to 4.2 billion cubic feet per day in the current fiscal year.