Egypt awards five concessions to increase investments

offshore Egypt-Daniel Sinoca pixabayEgypt has awarded five oil and gas concessions that are expected to bring in minimum total investments of about US$100mn, the Oil Ministry has recently announced

The North African country has gone from exporting energy to being a net energy importer and wants to boost local production to help the country cope with its worst energy crisis in decades.

A consortium of Seychelles-registered Pacific Oil and Malaysia’s Hibiscus Petroleum will explore in the 68 sq km South East Ras El Ush concession (Block 2) in the Gulf of Suez, with a minimum investment of US$68mn, the ministry statement said.

Gulf Hibiscus successfully bid for Block 2 with Pacific Oil Limited in a 50:50 joint venture with the latter acting as operator of the concession. The offshore concession, in water depth of up to 75 metres, is surrounded by development leases.

Block 2 contains the discovered West Ashrafi field, which is included in the concession, and may be developed with a production tie-in to the nearby existing onshore infrastructures. Commercial oil and gas were found at two wells that were previously drilled in the field.

“The award is subject to the execution of a definitive agreement. Gulf Hibiscus’ financial exposure to undertake the minimum work commitment is estimated to be approximately US$8mn over the first four years (first exploration phase),” Hibiscus Petroleum said in the release.

Meanwhile, Kieron Megawish will explore the 194 sq km North Megawish Concession in the Gulf of Suez, with a minimum investment of US$23mn, the statement added.

Three other concessions were awarded with minimum investments of US$7mn.

State-owned Ganoub El Wadi Petroleum Holding Company (Ganope) also had opened bidding at the end of 2014 for 10 concessions in the Gulf of Suez, Eastern Desert and west and east of the Nile in the areas of al-Naqra and Kom Ombo.

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