Egypt plans to invest $4.5 billion in refinery development as part of its fiscal year 2026/27 budget, as the government moves to reduce its dependence on imported petroleum products and expand domestic energy production.
Karim Badawi, Minister of Petroleum and Mineral Resources, and Ahmed Rostom, Minister of Planning and Economic Development, outlined the investment and production priorities at a joint meeting to review the energy sector’s role in the new fiscal year’s development plan.
Badawi said the Ministry of Petroleum and Mineral Resources (MoPMR) will focus on increasing oil and gas output, attracting new investment, reducing the petroleum product import bill, and expanding local value-added activities while meeting domestic energy needs.
The $4.5 billion refinery spend is central to that agenda, targeting higher local production capacity as a direct substitute for imports.
The plan also includes receiving natural gas from Cyprus and re-exporting it to international markets through Egypt — a move that would position the country as a regional energy transit hub, leveraging its existing liquefied natural gas infrastructure.
Rostom pointed to the regular settlement of dues owed to foreign petroleum partners as a key enabler of the broader investment push. He said those payments have helped create conditions for increased exploration and production spending by international companies and private-sector investors — a signal to the market that Egypt is working to clear the arrears that have historically deterred upstream activity.
Rostom also framed energy security as a national priority, noting that ongoing geopolitical tensions continue to affect both the region and global markets. He described the petroleum and energy sector as a pillar of economic activity and a component of Egypt’s national security architecture.
The announcements follow a modest but significant recovery in Egypt’s petroleum sector. In June 2026, Rostom confirmed that the sector grew 0.7% in the third quarter of fiscal year 2025/26 — its first positive growth rate since the first quarter of fiscal year 2023/24. The rebound was driven by higher domestic production of crude oil, condensates, and liquefied petroleum gas (LPG).
For international investors and energy companies active across North Africa, the scale of the planned refinery investment signals a structural shift in Egypt’s energy policy — away from import dependency and toward domestic processing capacity. No specific refinery projects or private operators were identified in the government’s statement.
Egypt’s position as a potential gas transit corridor — connecting East Mediterranean producers to European and global buyers — adds a regional dimension to the strategy that extends well beyond its domestic market.
