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Egypt's Potential Gas Surplus Could Feed Global LNG Glut

The most populous Arab country has facilities to turn gas into super-chilled LNG, which can be exported by ship. 

The most populous Arab country has facilities to turn gas into super-chilled LNG, which can be exported by ship. 

Photographer: Dana Smillie/Bloomberg

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Egypt faces a possible over-abundance of natural gas after two Israeli companies proposed a $15 billion supply deal, raising the prospect that the Arab nation may turn its surplus into liquefied natural gas and export it to a market currently glutted with LNG.

Egypt was already expecting to become self-sufficient in natural gas by the end of this year with the start of Eni SpA’s giant Zohr field, Oil Minister Tarek El-Molla said last month. Noble Energy Inc. and Delek Drilling-LP said Monday they plan to supply around 64 billion cubic meters of gas over 10 years to Egypt’s Dolphinus Holdings Ltd. from Israel’s Tamar and Leviathan reservoirs, in a $15 billion export arrangement.