Scatec ASA says its Obelisk solar and battery storage facility in Egypt can save the nation as much as $400 million annually in liquefied natural gas imports, CEO Terje Pilskog told Rigzone. The project represents a shift in Egypt's energy strategy amid tightening domestic gas supplies and rising import costs.
Egypt has been grappling with declining natural gas production and growing power demand, forcing increased LNG purchases on the spot market. The Obelisk facility is designed to displace a portion of that gas-fired generation by supplying solar power during peak daylight hours, backed by battery storage for nighttime and cloudy periods.
With a planned capacity of 1 gigawatt of solar photovoltaic panels and 200 megawatt-hours of battery storage, the project marks one of Africa's largest renewable energy investments. Scatec anticipates final investment decision later this year, with commercial operations expected by late 2028. Construction could support thousands of local jobs during peak development.
Egypt's pivot to solar carries geopolitical weight: reduced LNG imports free up foreign currency reserves and lessen exposure to volatile global gas markets, a priority since the 2022 energy crisis. The project also aligns with Cairo's updated 2035 renewable energy target of 42 percent of generation.
Critics caution that large-scale solar farms require significant land and transmission upgrades, and that battery storage economics remain challenging at current technology costs. Without reliable backup, grid stability could suffer during extended low-solar periods.