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Egypt Considering Adding New Regasification Vessel in Ain Sokhna

Egyptian Petroleum and Mineral Resources Minister Karim Badawi attends a meeting with a parliamentary committee reviewing the new government's program (Asharq Al-Awsat)
Egyptian Petroleum and Mineral Resources Minister Karim Badawi attends a meeting with a parliamentary committee reviewing the new government's program (Asharq Al-Awsat)
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Egypt Considering Adding New Regasification Vessel in Ain Sokhna

Egyptian Petroleum and Mineral Resources Minister Karim Badawi attends a meeting with a parliamentary committee reviewing the new government's program (Asharq Al-Awsat)
Egyptian Petroleum and Mineral Resources Minister Karim Badawi attends a meeting with a parliamentary committee reviewing the new government's program (Asharq Al-Awsat)

Egypt is considering adding a new Floating Storage Regasification Unit (FSRU) to its port facilities at Ain Sokhna to increase import capacity, according to a petroleum ministry statement.
The ministry is also considering adjusting Egypt's two export liquidation units in Idku and Damietta to import gas instead.
A study is underway to add another floating unit for storage and gasification in Ain Sokhna, with the possibility of adjusting two export liquidation units in Idku and Damietta to import gas instead, the Ministry said.
In Egypt, the storage and gasification unit is equipped to receive and store imported LNG, which could alleviate the country's current power outage crisis.
Last May, the Egyptian Natural Gas Holding Company (EGAS) concluded an agreement with Norway’s Hoegh LNG to rent the Hoegh Galleon floating unit for liquefied natural gas (LNG) for storage and regasification “to secure additional needs for domestic consumption during the summer.”
The gasification process is the conversion of LNG into its gaseous form for direct consumption. Egypt has two LNG plants, Damietta and Idku, for converting gas into liquid so it can be exported by ship, and a gas export pipeline.
But the government has decided to keep gas for the domestic market.
In the past two months, Egypt began buying LNG, a rare move by the fuel exporter to avoid shortages this summer.
On Sunday, the Ministry said in a statement that Egypt is planning to drill 110 exploratory wells for gas and oil, with a total investment of $1.2 billion during the current fiscal year 2024/2025.
Egyptian Petroleum and Mineral Resources Minister Karim Badawi said that Egypt will have 586 exploratory wells for gas and oil drilled, with a total investment of $7.2 billion by 2030.
In a meeting with a parliamentary committee reviewing the new government's program, Badawi said, “Our top priority is to continue coordination and cooperation with the Ministry of Electricity and Renewable Energy to provide the necessary fuel supplies to operate power stations.”
He noted that Egypt coordinates with foreign partners to schedule and pay off overdue payments to encourage them to inject more investments to increase oil and gas production as quickly as possible.
In addition, Badawi highlighted that the ministry focuses on creating incentive mechanisms to boost production programs and expedite exploration programs to benefit all parties.
“We will also continue to attract foreign investment in the short term, by adopting a new investment concept, which will contribute to the full utilization of the petroleum sector from refineries, petrochemicals and mineral resources, along with maximizing the use of the modern capabilities of digital transformation and AI technologies,” he added.

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Saudi Arabia Raises $12 Billion in International Bonds Amid Strong Demand

Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).
Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).
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Saudi Arabia Raises $12 Billion in International Bonds Amid Strong Demand

Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).
Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).

Saudi Arabia has raised $12 billion from global debt markets in its first international bond issuance of the year, attracting bids worth nearly $37 billion. This demonstrates strong investor appetite for Saudi debt instruments.

The issuance comes just two days after the approval of the 2025 annual borrowing plan by Minister of Finance Mohammed Al-Jadaan. The plan estimates financing needs for the fiscal year at SAR 139 billion ($37 billion). The funds will be used to cover the projected SAR 101 billion ($26.8 billion) budget deficit for 2025, as well as repay SAR 38 billion ($10 billion) in principal debt obligations due this year.

The National Debt Management Center (NDMC) announced on Tuesday that the issuance includes three tranches: $5 billion in three-year bonds, $3 billion in six-year bonds, and $4 billion in ten-year bonds. Total demand for the bonds reached $37 billion, exceeding the issuance size by three times and reflecting robust investor interest.

The NDMC emphasized that this issuance aligns with its strategy to broaden the investor base and efficiently meet Saudi Arabia’s financing needs in global debt markets.

According to IFR, a fixed-income news service, the initial price guidance for the three-year bonds was set at 120 basis points above US Treasury yields. The six-year and ten-year bonds were priced at 130 and 140 basis points above the same benchmark, respectively.

Strong demand allowed Saudi Arabia to lower yields on the shorter-term bonds, further demonstrating investor confidence. Economists noted that the pricing above US Treasuries is attractive in the current market, showcasing trust in Saudi Arabia’s economic stability and financial strategies.

International confidence

Economic experts view this successful bond issuance as a testament to international confidence in Saudi Arabia’s robust economy and financial reforms. Dr. Mohammed Al-Qahtani, an economics professor at King Faisal University, said the move underscores Saudi Arabia’s commitment to diversifying financing tools both domestically and internationally. He added that the funds would support Vision 2030 projects, reduce pressure on domestic resources, and attract strong international investor interest.

The issuance strengthens Saudi Arabia’s ability to meet financial needs, expand its investor base, and establish a global financing network, he said, noting that it also facilitates entry into new markets, enabling the Kingdom to accelerate infrastructure projects and capital expenditures.

Dr. Ihsan Buhulaiga, founder of Joatha Business Development Consultants, described the 2025 budget as expansionary, aimed at meeting the financing needs of economic diversification programs. He stressed that the budget deficit is an “optional” one, reflecting a deliberate choice to prioritize Vision 2030 initiatives over immediate fiscal balance.

Buhulaiga explained that the Kingdom’s approach balances two options: limiting spending to available revenues, which would avoid deficits but delay Vision 2030 initiatives, or borrowing strategically to fund Vision 2030 goals. He said that the annual budget is just a component of the larger vision, which requires sustained funding until 2030.

He continued that Saudi Arabia’s fiscal space and creditworthiness allow it to borrow internationally at competitive rates, explaining that this flexibility ensures financial sustainability without compromising stability, even during challenges like the COVID-19 pandemic.

Saudi Arabia’s debt portfolio remains balanced, with two-thirds of its debt domestic and one-third external. As of Q3 2024, public debt stood at approximately SAR 1.2 trillion, below the 30% GDP ceiling. According to the Ministry of Finance, the budget deficit is expected to persist through 2027 but remain below 3% of GDP.

Buhulaiga highlighted the importance of capital expenditure, which reached SAR 186 billion in 2023 and is projected to rise to SAR 198 billion in 2024, a 6.5% increase.

He emphasized the government’s pivotal role in economic diversification, supported by investments from the Public Investment Fund (PIF), the National Development Fund, and its subsidiaries, including the Infrastructure Fund.

The PIF recently announced a $7 billion Murabaha credit facility, facilitated by Citigroup, Goldman Sachs International, and JPMorgan. Meanwhile, the NDMC arranged a $2.5 billion revolving credit facility earlier in January, compliant with Islamic principles, to address budgetary needs.

In November, Moody’s upgraded Saudi Arabia’s credit rating to Aa3, aligning with Fitch’s A+ rating, both with a stable outlook. S&P Global assigns the Kingdom an AA-1 rating with a positive outlook, reflecting a high ability to meet financial obligations with low credit risk.

The IMF estimates Saudi Arabia’s public debt-to-GDP ratio at 26.2% in 2024, describing it as low and sustainable. This is projected to rise to 35% by 2029 as foreign borrowing continues to play a key role in financing deficits.