Egypt’s bold 2030 Vision to transform the energy sector

In an exclusive interview with the Energy Connects Quarterly Review, H.E. Eng. Karim Badawi, Egypt’s newly-appointed Minister of Petroleum and Mineral Resources, shares his vision for the energy sector and how the country is poised to consolidate its reputation as a leading energy hub. Underscoring the pivotal role of the oil & gas sector to Egypt’s development, H.E. Badawi explains how it was able to accomplish major successes geared towards achieving Egypt 2030 Vision, unlocking the sector’s investment potential, ensuring energy security, and achieving financial sustainability.

Your Excellency, the oil and gas sector has seen radical changes in the past years. As the newly appointed Minister, could you outline the strategies and incentives to further strengthen the sector’s role? What are the new mechanisms to be implemented by the Ministry to attract further investments?

The global energy industry has witnessed severe turbulence over the past decade due to the impact of the pandemic and several geopolitical challenges.

In Egypt, we have always regarded the oil and gas sector as pivotal to the country’s development. It is one of the main contributors to Egypt’s GDP and the main source of energy with high potential to generate foreign currency. In spite of all the challenges, the sector was still able to accomplish major successes, geared towards achieving Egypt 2030 vision.

We worked in a more proactive way to achieve our vision: “to unlock the sector’s full value chain potential, ensure energy security, promote investment opportunities, achieve financial sustainability and for Egypt to become a leading regional energy hub”.

As the newly appointed Minister, I am fully aware of the global challenges that are strongly hindering our sector’s progress. However, I believe in the sector’s ability to overcome all these challenges, utilising its assets whether human, infrastructure, partner alliances and of course Egypt’s strategic location.

The sector is working hard with our partners to make use of our exploration potential and enhance production to guarantee domestic energy security and continue Egypt’s promising regional role. I am committed to continue on what the sector has started, accomplish further successes and maximise the value of our natural resources in line with the national strategy on value addition.

I would also like to reassure all our partners that I will personally be following up closely to resolve any challenges or show-stoppers facing them in line with the new government’s programme goal of “building a competitive economy that attracts investments”.

I would like to stress on the pledge of the new cabinet of Egypt under the leadership of the Prime Minister H.E Dr. Moustaf Madbouly, to actively work across ministries and authorities to accelerate investments.

Believing in the importance of digitalisation, the sector launched back in 2021 the Egypt Upstream Gateway (EUG) – which is a fully integrated online platform that enables seamless data access and offers the opportunity to explore new plays, prospects and evaluate basins’ potential.

EUG provides a platform to attract new investments to Egypt by digitally promoting Egypt’s oil and gas bid rounds through seamless online access to the sector’s data & promote Egypt’s exploration and production potential worldwide.

We have already launched 7 bid rounds on the EUG since its establishment in 2021 and the 8th one is currently in place for 12 blocks in the Mediterranean and the Nile Delta areas.

In addition, for the first time, we have announced several exploration and production investment opportunities across all areas through EUG according to the open blocks license program (OBLP) that supports the Egypt’s vision to attract new investments and accelerate all upstream activities.

“As the newly appointed Minister, I am fully aware of the global challenges that are strongly hindering our sector’s progress. However, I believe in the sector’s ability to overcome all these challenges, utilising its assets whether human, infrastructure, partner alliances and of course Egypt’s strategic location … I am committed to continue on what the sector has started, accomplish further successes and maximise the value of our natural resources in line with the national strategy on value addition. I would also like to reassure all our partners that I will personally be following up closely to resolve any challenges in line with the new government’s goal of building a competitive economy that attracts investments.”

How is the Ministry modernising infrastructure and transforming the use of domestic resources to reduce dependence on energy imports?

Egypt’s goal is to play a prominent role in global energy trade flow and foster an environment that simulates better trade and business links among regional countries to ensure collaboration and alliance. A part of the sector’s strategy is based on modernising the infrastructure and upgrading the refineries and pipelines that supports Egypt’s potentials.

The sector is completing its refinery upgrading projects to leverage the refining capacities that are close to 40 million tons per year, by adding new conversion units and expanding capacities of existing refineries. Efforts are exerted towards maximizing utilisation and integration of the refining and petrochemicals facilities in order to unlock the full production potential of the sector’s assets.

Egypt has significant storage capacities for petroleum products – the SUMED pipeline and the Suez Canal which connect the Red Sea with the Mediterranean are strategic trade routes for delivering energy commodities to international markets. There are 14 petroleum ports with an annual trading volume of more than 90 million tons, providing significant opportunities for trade and handling of petroleum products.

Egypt’s unique LNG facilities at Idku and Damietta over the Mediterranean coast with a total export capacity of 12 million tons annually, make it a ready-made solution for unlocking the region’s low carbon natural gas supplies to supply growing energy needs in EU and globally. With lengths reaching more than 8,000 km for main lines, Egypt also has an extensive natural gas grid, which is one of the largest and longest gas networks in Africa and the Middle East.

Egypt’s national gas grid covers the Nile Delta and Western Desert area, to the furthest point of the South Valley in Aswan, extending to Sinai in the East and along the coast of the Red Sea. This serves as a backbone to support transmission of natural gas across the country. Egypt also has two main gas pipeline connections with the East, which serves as a main point for gas trade with the East Mediterranean region.

In addition, the sector is working towards boosting the pipeline connections towards the West to enhance Egypt’s strategic position connecting energy supply with demand in regional and international markets. Moving forward, the sector will continue working with all its partners in the region to enhance its performance and reinforce Egypt’s key role in the global map as a regional energy hub.

What are the key factors behind Egypt’s exceptional potential in the mining sector and what is its future outlook?

Egypt is blessed with a unique strategic location, infrastructure and abundant undeveloped mineral wealth, being part of the Arabian Nubian shield – as “the land of golden opportunities”. Our legacy of mineral wealth includes gold, copper, silver, zinc, platinum and several other precious and base metals. With an estimated geological reserve of 7.36 million ounces of gold, Egypt has the potential to be one of the top mining destinations globally.

This vast potential is massively supported by the Egyptian Government’s Economic Reform Programme, which aims to achieve economic stability, attract investments and enhance market attractiveness under the Egypt 2030 vision. These factors have been key triggers, allowing us to fundamentally change our operations as we reposition Egypt on the world's mining investment map.

The sector embarked on a huge modernisation project concentrating on all the sector’s activities. The project mainly focused on identifying the areas of enhancement and as a result, worked on the reforms of several key aspects including regulatory, fiscal, governance and licensing. 

The mining sector is already reaping the fruits of the modernization and is determined to continue this progress further. The goal is to launch 300 licenses annually, significantly increase mining's GDP contribution to $7.8 billion, achieve $5.2 billion in exports, and create 110,000 jobs by 2030.

We are working hard to launch at least three bid rounds on an annual basis, in order to increase the total licensed area – especially on the Eastern Desert where the Nubian Shield contains the untapped mineral wealth of the country. In addition to having new mines in operations for the next five years and enhancing the integration of mining policies across governmental entities,  we also recognise the importance of coherence and efficiency in resource management.

The modernisation programme is a cornerstone of our vision for Egypt's mining sector. By leveraging these reforms and engaging with global best practices, we are poised to unlock the full potential of our mineral resources, driving economic growth and prosperity for the nation

How is Egypt pursuing the energy transition and paving the way for a sustainable and lower-carbon future?

Egypt recognises the increasing threats from climate change and supports the need to take serious global actions to combat its negative effects. President Abdel Fattah El Sisi emphasised this at COP28, stating that Egypt acknowledges the critical need to work towards enhancing collective and urgent action to address challenges of climate change.

The Egyptian Government continues to be leading economic reforms and driving the country’s efforts towards green economy by improving investment climate and supporting the private sector to attract more investments in clean energy projects. This is in addition to updating Nationally Determined Contributions (NDCs) in 2023 to reflect an ambitious target of 42% renewable electricity to be achieved by 2030 instead of 2035. The government issued the region’s first sovereign green bond to finance projects in clean transportation and sustainable water management. It also set ambitious targets for low carbon hydrogen to capitalize on the country’s unique assets in this domain.

Egypt is cooperating with the EU and the US Department of Energy on energy decarbonisation. The energy sector has signed an MoU with the European Union for strategic partnership in the field of green hydrogen production and its derivatives.

The oil and gas sector in turn developed decarbonisation and energy transition strategy based on six main pillars, including priority areas for energy efficiency, carbon intensity reduction and low carbon hydrogen. It managed to implement more than 30 flare gas recovery projects, 300-plus measures for improving energy efficiency and continue the Methane Measurement and Leak Detection and Repair campaigns.

Egypt advocates the need to be realistic and pragmatic about achieving a just, equitable and inclusive energy transition. We believe that business partners, private sector and the government should work towards aligning their efforts to inject funds towards energy transition projects.

Your Excellency, the Egypt Energy Show (EGYPES) is just 6 months away.  In what will be your first edition as Minister, can you tell us, how important is the show in terms of showcasing Egypt’s future energy plans?

EGYPES has evolved a lot over the past years. It is now considered the most important energy show in North Africa and the Mediterranean, providing an opportunity for the global energy community to reconnect with a wider network of key and international stakeholders to forge new face-to-face business relationships.

Held under the patronage of H.E. President Abdel Fattah El Sisi, the Egyptian oil and gas sector regards EGYPES as its window to the global energy industry as it offers world-class investment opportunities, intensifies the role of foreign investments and provides international and local participants a great chance to network, seek knowledge and conduct business with key organisations. Every year, this major platform aims to display positive results and demonstrate the progress achieved towards delivering the future of energy. I am eager to build on the huge success of the past editions and I am optimistic for EGYPES 2025 next February to discuss the upcoming opportunities and future of the oil and gas industry in light of the new energy trends.