As part of its drive to boost domestic gas production from aging fields and secure new investments in the energy sector, the state-owned Egyptian Natural Gas Holding Co. (EGAS) has inked $340 million in agreements to drill 10 new wells in the Mediterranean Sea offshore Egypt, and in the Nile Delta.
Egypt’s petroleum ministry announced four new contracts on 30 August, including
- A $120 million agreement with Shell for three wells in Mediterranean's Merneith offshore area.
- A $100 million investment by Eni Egyptian subsidiary, International Egyptian Oil Co. (IEOC), to drill three wells in the East Port Said offshore block. Eni holds a 50% operator interest in Egypt’s supergiant Zohr gas field 200 km north of Port Said in the Shorouk area with Russia’s Rosneft (30%), BP (10%), and the UAE’s Mubadala Energy (10%).
- A $109 million investment by BP’s Arcius Energy joint venture (JV) with ADNOC’s XRG investment arm to operate in the North Damietta offshore area. BP holds 51% of the JV to ADNOC’s 49%.
- A $14 million deal signed by Russia’s Zarubezhneft to drill four wells in the onshore North El-Khatatba block in the Nile Delta.
These agreements follow the Egyptian ministry’s announcement on 24 June of the award of six blocks into which $245 million would be invested to drill a minimum of 13 exploration wells in the Mediterranean, the Nile Delta, and North Sinai.
Recipients included
- Chevron Egypt and BG (Shell): North Samian Offshore and Northwest Atoll Offshore (Mediterranean)
- Eni (IEOC Production): North Ras El Tin Offshore (Mediterranean)
- Cheiron Egypt: East Alexandria Offshore (Mediterranean)
- IPR Energy: North Tanta Onshore (Nile Delta)
- Perenco: El Fayrouz Onshore (North Sinai), including a 3D seismic survey and one well.
The Joint Organizations Data Initiative reported a drop in Egypt's monthly gas production in May to 3.5 Bcm, roughly half of the 6 Bcm per month that flowed in 2021. The decline is largely attributed to water infiltration and depletion at key fields like Zohr and aging infrastructure in mature fields.
