Egypt’s Largest Fertilizer Company Turns to Hydrogen Amid Gas Shortage Crisis
In response to a severe shortage of natural gas causing widespread blackouts in Egypt, Abu Qir Fertilizers, one of the country’s major fertilizer companies, announced on June 27 that it would partially transition to hydrogen supplies.
The decision comes after Abu Qir Fertilizers, along with three other key players in the fertilizer and chemicals sector – Mopco, Sidi Kerir Petrochemicals, and KIMA – revealed plans to halt production due to the lack of natural gas, a crucial input for their operations.
As the closures took effect, Egyptians faced worsening blackouts, a recurring issue since last year attributed to increased summer power consumption and the gas shortage.
Prime Minister Mostafa Madbouly pointed to a production stoppage in a neighboring country, likely Israel, and pressures on dollar resources as reasons for the gas shortage in Egypt. He announced a budget of over $1 billion to import sufficient gas and mazut fuel oil to end the blackouts this summer.
To address the immediate gas shortfall, Egypt, the most populous Arab nation, recently secured a tender for purchasing 17 cargoes of liquefied natural gas. The country is also in search of three additional cargoes for delivery in August-September, according to insider sources.
While the tender was initiated earlier in the month, it remains unclear if it aligns with Madbouly’s comprehensive plan to resolve the energy crisis.
This week’s plant closures mark the second time chemical and fertilizer companies have ceased operations in June. The initial shutdowns were prompted by the government’s temporary reduction of gas supplies to the plants.
Despite the challenges, Sidi Kerir Petrochemicals announced on June 27 that its gas supply had been restored, allowing the company to resume operations at its plants.