China is targeting Egypt to challenge Europe in Middle Eastern energy

China North Petroleum International Company (NPIC) has announced a significant increase in its presence in Egypt's energy sector, with an initial investment of $100 million aimed at acquiring concessions and establishing partnerships in the oil and gas sectors in Egypt's Western Desert and offshore areas. This investment represents only the first phase of a broader Chinese plan to strengthen its position in Egypt, a country of crucial strategic importance.

Chinese interest in Egypt is largely due to the key role that the country has assumed for the West in guaranteeing alternative gas supplies to the Russian ones, after the invasion of Ukraine as Simon Watkins well points out. Following this, huge US and European investments, led by companies such as Chevron and Eni, poured into Egypt, taking advantage of its strategic location between North Africa, the Middle East and the eastern Mediterranean. These Western investments have been further consolidated with the arrival of British companies such as Shell and BP, the latter intending to invest 3.5 billion dollars over the next three years in the exploration and development of Egyptian gas fields.

Egypt is of unique strategic importance for several reasons. It is the only country in the Eastern Mediterranean region with operational liquefied natural gas (LNG) export capabilities, ideal for becoming a regional hub. It also controls the Suez Canal, a key maritime transit point for around 10% of the world's oil and LNG, and the Suez-Mediterranean Pipeline, a crucial canal alternative for transporting oil from the Persian Gulf to the Mediterranean.

Natural Gas Reserves of Egypt

Currently, the Suez Canal represents one of the few global transit points not yet under Chinese control. Beijing, in fact, already exercises considerable influence on the Strait of Hormuz and the Strait of Bab al-Mandab, consolidating its grip on crucial energy routes.

Egypt, traditionally considered a leader in the Arab world, represents an important partner for the West to counterbalance the growing Sino-Russian influence, particularly in a context of Saudi Arabia's rapprochement with the Chinese sphere.

Offshore platform in Egypt

For China, Egypt could be seen as an opportunity not to be missed . Although NPIC has been operating in Egypt since 2014, Chinese plans initially focused more on the heart of the Middle East and the large oil fields of Iran, Iraq and Saudi Arabia. However, the signing of a comprehensive strategic partnership until 2028 marks a renewed Chinese commitment, with multibillion-dollar investments in Egypt in energy, infrastructure and technology sectors, including cooperation in advanced sectors such as artificial intelligence and defense.

Growing Chinese activity in Egypt has not gone unnoticed by the West. Recently, there has been an acceleration of Western investment in the country, with new natural gas discoveries by ExxonMobil and development plans by Chevron to export gas from Cyprus to Egypt. These efforts aim to further strengthen Egypt's role as a key energy hub for the West in the Eastern Mediterranean, crucial to European energy security, in response to growing Chinese influence in the region.

The article China looks to Egypt to challenge Europe in Middle Eastern energy comes from Economic Scenarios .

This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/la-cina-punta-allegitto-per-sfidare-leuropa-nellenergia-mediorientale/ on Sun, 09 Mar 2025 13:00:37 +0000.