Egypt marks record year for gas discoveries

Egypt has made a string of major gas discoveries over the past two months — capped by its biggest find in the Western Desert in 15 years — as the Iran war drives energy demands to record highs, poising Cairo for a return to its role as a major gas export hub.

"I think the new discoveries will help address Egypt's challenging energy balances but are unlikely to be transformational," said Bill Farren-Price, head of gas research at the Oxford Institute for Energy Studies.

"Rising power demand is still likely to outpace upstream gains, although the reforms are likely to pull in more international companies and reinvigorate those already in country," he continued.

In the space of two months Egypt announced three significant gas finds, all linked to Eni, the Italian oil and gas supermajor who is the operator or founding member in the entities that made the finds and has been active in Egypt since 1954.

In April, Eni and BP unveiled Denise West, an offshore Mediterranean discovery estimated at around 2 trillion cubic feet of gas.

"At 2 trillion cubic feet of gas in place, Denise West is the biggest gas discovery in Egypt since Chevron's 2023 Nargis find," said Martijn Murphy, principal analyst for North Africa upstream at Wood Mackenzie.

"Proximity to existing infrastructure, operated by Eni, offers the possibility for a fast-track development."

In early May came Nidoco N-2 in the Nile Delta's West Abu Madi area, operated by Eni and BP through their Petrobel joint venture, expected to add around 50 million cubic feet per day.

Later in May, Agiba Petroleum — a joint venture between Eni and state-owned EGPC — announced South Bostan-1X in the Western Desert, with initial estimates of 330 billion cubic feet of gas, 10 million barrels of condensates and crude, and total reserves of roughly 70 million barrels of oil equivalent.

Murphy said South Bostan was smaller than Denise West but still notable for an onshore Western Desert discovery, where mature acreage can offer lower-cost opportunities close to existing infrastructure.

“Both discoveries will bolster flagging domestic gas production and the need for costlier imported LNG cargoes,” he said.

All three lie close to existing infrastructure, which analysts say is key to bringing them onstream quickly and at lower cost.

Together, they point to renewed drilling momentum after years of falling domestic production and growing pressure on Egypt's foreign currency reserves from energy imports.