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Egypt's oil and gas sector attracts global giants: Key updates

This article will help you understand in a nutshell the latest updates in Egypt's growing oil and gas sector.
© Egypt Business Directory

Egypt's dynamic oil and gas sector continues to make significant strides, attracting major international players and ramping up domestic production to meet rising energy demands. The latest developments highlight Egypt's growing prominence as a key player in the global energy market.

Chilean firm Enap Sipetrol eyes egyptian concessions

Chilean energy giant Enap Sipetrol is set to expand its footprint in Egypt. During a recent meeting, Minister of Petroleum and Mineral Resources Tarek El-Molla confirmed that Enap Sipetrol is seeking new concessions and plans to boost production and investments in Egypt's petroleum sector. The discussions, which included the Chilean Ambassador to Cairo, Roberto Ebert, and Enap Sipetrol's top executives, underscore the company's commitment to enhancing its operational capabilities in the region.

QatarEnergy's strategic partnership with ExxonMobil

In a significant move, QatarEnergy has partnered with ExxonMobil to acquire a 40% interest in two offshore exploration blocks, Cairo and Masry. This agreement, pending approval from the Egyptian government, marks QatarEnergy's expanded presence in Egypt and reinforces its long-term strategic alliance with ExxonMobil. The exploration blocks, covering approximately 11,400 square kilometers, were awarded to ExxonMobil in January 2023, emphasizing the potential for substantial discoveries.

Surge in natural gas consumption and production

Egypt's natural gas consumption soared to 6.1 billion cubic feet per day in May, driven by increased demand from power plants. The Ministry of Petroleum and Mineral Resources reported that conventional power plants alone are consuming around 3 billion cubic feet daily. To manage this demand, Egypt suspended LNG exports and is importing additional shipments. The country aims to boost natural gas production by 8% in the upcoming fiscal year, targeting 5.7 billion cubic feet per day, with significant contributions expected from deep-water fields in the western Delta.

ADES Holding's $43 million dilling contract

Saudi Arabia-based ADES Holding has secured a substantial $43 million contract with Egypt’s Suez Oil Company (SUCO) for drilling operations in the Gulf of Suez. This 21-month contract enhances ADES's operational footprint in the region and supports Egypt's offshore production capabilities. The deal follows ADES's recent wins in Qatar and Thailand, showcasing its agile response to market demands and strategic expansion in the Middle East.

Wepco's $420 million expansion in oil storage

State-owned Western Desert Operating Petroleum Company (Wepco) is investing $420 million to expand its Al Hamra terminal. This project, expected to be completed in phases by early 2025, will significantly boost Egypt's crude oil storage capacity. Wepco plans to process 95 million barrels of oil in the next fiscal year, averaging 260,000 barrels per day. The expansion underscores Wepco's crucial role in facilitating domestic and international crude oil trade.

EGAS and Höegh LNG's FSRU agreement

In a strategic move to enhance energy security, EGAS has partnered with Höegh LNG to deploy a Floating Storage and Regasification Unit (FSRU) in Ain Sokhna. The FSRU Hoegh Galleon will support Egypt's increased natural gas demand during the summer, with the Egyptian government committing to an annual fee of $90 million for its use. This deployment, set to last for 19 to 20 months, exemplifies the flexible infrastructure solutions being implemented to stabilize Egypt's energy supply.

Rising oil exports and global interest in wataniya

Egypt's oil exports surged by nearly 26% in February, despite a slight overall decline in export value. Additionally, the state-run fuel retailer Wataniya has attracted seven international and local acquisition offers, highlighting significant global interest in Egypt's energy assets. The government is currently evaluating these offers to determine the best bid.