Troubled Waters: Egypt and Ethiopia Wrangle Over Nile Dam

18 Jan 2018   Egypt, Ethiopia

The world’s longest river, a lifeline for hundreds of millions of people, is also fast becoming a fault line. Ethiopia’s ambitious $4.2 billion hydroelectric dam project on the Nile River’s main tributary is raising tensions with Egypt over how to share the essential resource, and exposing the rivalry between Cairo and an ascendant Addis Ababa for regional power. The main point of contention is Ethiopia’s plan to fill the Grand Ethiopian Renaissance Dam’s 74-billion-cubic-meter reservoir within three years of the dam’s planned completion in 2019—a pace that downstream Egypt argues will leave water levels in its floodplain dangerously low. “Egypt cannot live without the Nile,” Mohamed Abdel-Ati, Egypt’s minister of irrigation and water resources, said last month. “Egypt understands Ethiopia’s right to development but Ethiopia has to prove, practically, that the dam won’t harm Egypt.” Down Stream Ethiopia is building a hydroelectric dam on the Nile River’s main tributary, […]

With new gas deals, Egypt closes in on energy hub goal

28 Dec 2017   Egypt

Egypt is set to inaugurate a new wharf for natural gas and petroleum product tankers on the Gulf of Suez in the coming days, another step in its plan to become a regional energy hub. The new 2.5 km wharf is being built by SUMED, which for decades has operated two pipelines from the Red Sea to the Mediterranean. The wharf will have three berths to receive natural gas and petroleum products carriers. It is due to be completed by the end of the month, Al-Masry Al-Youm newspaper quoted SUMED chairman Mohamed Abdel-Hafez as saying. Abdel-Hafez confirmed the remarks in a text message to Reuters. The country has been building fuelling depots for ships along the Suez Canal and expanding its refining capacity. It has an extensive pipeline network and two idle gas liquefaction plants ready to export new gas as it arrives. SUMED, owned 50 […]

A New Era For Oil And Gas Majors

Two and a half years ago, analysts asked when Italy’s Eni would be able to start producing gas from the giant Zohr field offshore Egypt. The overwhelming majority said this would happen no earlier than 2019, and most likely after 2021. But first gas from Zohr flowed earlier this month, in the latest sign that the future of the oil and gas industry will be very different from its past. Big Oil has traditionally taken its time with new projects, especially offshore ones. They require a lot of exploration, a lot of planning, and a lot of equipment once the final investment decision has been made. But no longer: the 2014 crisis really changed the setting, forcing the mammoths of the industry to at least try to become more nimble and flexible. The Italian major is not the only one speeding things up, but it is to date the […]

Eni ‘Mission Impossible’ Points to Seismic Shift for Big Oil

The quick turnaround from discovery to production hasn’t gone unnoticed in the industry. It represents a seismic shift for Big Oil.  The fact even senior managers privately described the plan as “Mission Impossible” showed the scale of the task: Italian energy giant Eni SpA wanted to produce gas from the Zohr field little more than two years after finding it in August 2015. But this week, the Mediterranean’s largest gas field — lying about 200 kilometers (168 miles) off the Egyptian coast — began pumping, defying skeptics both inside and outside the company. “We presented our development plan to Egypt’s minister after two weeks,” Chief Executive Officer Claudio Descalzi said in an interview in Port Said, the dusty town three hours from Cairo where the gas arrives on the Egyptian mainland. “Nobody believed what we were going to do, analysts said we were crazy; now we can […]

Giant gas field startup could transform Egypt

21 Dec 2017   Egypt

The Egyptian energy sector will be transformed now that production started at the Zohr gas field, one of the biggest in the world, Italy’s Eni said Wednesday. Production started at the Mediterranean gas field less than two years after the company declared its initial commercial discovery, which Eni said was a record for a deep-water field like Zohr. Third quarter production for Eni averaged 1.8 million barrels of oil equivalent per day, up about 5.4 percent from the same period last year. Start ups and plans to ramp up production in the fourth quarter could bring that level to around 1.9 million boe on average, the highest level for Eni in seven years. By October, it was already […]

Zohr Begins Production

21 Dec 2017   Egypt

Eni SpA announces the production start up of Zohr, the largest ever discovery of gas in the Mediterranean Sea. Eni SpA announced Wednesday the production start up of Zohr, the largest ever discovery of gas in the Mediterranean Sea. The field, which is located in the Shorouk Block offshore Egypt, has potential resources in excess of 30 trillion cubic feet of gas in place (around 5.5 billion barrels of oil equivalent), according to Eni. Discovered in August 2015, Zohr obtained investment authorization after just six months and began production less than two and half years after first being found. In an organization statement, Eni said the field will be able to satisfy a part of Egypt’s natural gas demand ‘for decades to come’. “Today is a historic day for us. It further confirms the capability of Eni’s women and men to turn challenging opportunities into unprecedented achievements,” Eni’s CEO, […]

Zohr Begins Production

Eni SpA announces the production start up of Zohr, the largest ever discovery of gas in the Mediterranean Sea. Eni SpA announced Wednesday the production start up of Zohr, the largest ever discovery of gas in the Mediterranean Sea. The field, which is located in the Shorouk Block offshore Egypt, has potential resources in excess of 30 trillion cubic feet of gas in place (around 5.5 billion barrels of oil equivalent), according to Eni. Discovered in August 2015, Zohr obtained investment authorization after just six months and began production less than two and half years after first being found. In an organization statement, Eni said the field will be able to satisfy a part of Egypt’s natural gas demand ‘for decades to come’. “Today is a historic day for us. It further confirms the capability of Eni’s women and men to turn challenging opportunities into unprecedented achievements,” Eni’s CEO, […]

Exxon eyes Egypt’s offshore oil and gas

4 Dec 2017   Egypt

Exxon Mobil ( XOM.N ) is considering a foray into Egypt offshore oil and gas, seeking to replicate rivals’ success in the country and boost its reserves, officials and industry sources said.  Officials from the world’s largest listed oil producer recently held talks with Egypt’s petroleum ministry to discuss investments in oil and gas production, known as upstream operations, Petroleum Minister Tarek El Molla told Reuters. Sponsored “We have been discussing with them, visiting them. They’ve visited us… We are exploring all opportunities for having more and further upstreamers in Egypt,” Molla said on the sidelines of an OPEC meeting in Vienna. “I would be happy to have them with us,” he said, adding that no decision has been made yet. Exxon declined to comment. The Irving, Texas-based […]

Israel, Egypt Said to Discuss Gas Exports

27 Nov 2017   Egypt, Israel

Egypt clarified that option to import Israeli gas still open Previous arbitration ruling remains an obstacle to deals A natural gas production platform west of the Ashkelon shore in Israel. Ministers from Egypt and Israel held a call last week to discuss the potential sale of Israeli gas to Egypt, according to a person with direct knowledge of the matter. Egyptian Oil Minister Tarek El-Molla and Israel’s energy minister, Yuval Steinitz, spoke after an interview El-Molla gave to Bloomberg earlier this month sent shares of Israeli gas companies tumbling on speculation Egypt would halt talks on buying gas from Israel, the person said. El-Molla told Steinitz that Israeli gas exports to Egypt, which would be carried via pipeline, are still on the table, the person said. Shares of Israeli gas producers extended their gains, with Delek Group Ltd. closing 6.9 percent higher in Tel Aviv on Sunday. El-Molla said […]

Rosneft To Buy 30% Stake In Giant Zohr Gas Field

Russia’s oil giant Rosneft has closed the deal to buy from Italy’s Eni a 30-percent stake in the offshore concession in Egypt where the giant Zohr gas field is located, for US$1.125 billion, the Russian firm said on Monday. Rosneft also refunded its share in past project costs to the Italian company, which discovered Zohr in 2015 and plans to start production by the end of this year. Zohr has a total potential of 850 billion cubic meters of gas in place and is the largest natural gas field ever discovered in the Mediterranean, according to Eni, which has also divested an additional 10 percent in the concession to supermajor BP. Under the initial terms of Eni’s deal with Rosneft from December last year, the Russian firm would pay US$1.125 billion and the pro-quota reimbursement of past expenditures, which amounted at the time to around US$450 million. In addition, […]

Egyptian Company to Develop Mature Oil Fields With Mexico’s Pemex

5 Oct 2017   Egypt, Mexico

State oil company Pemex’s effort to secure a partner for two shallow-water fields in the Gulf of Mexico fell flat as none of the registered companies presented bids. Cheiron, part of the Pico Group, will join Pemex in the Cárdenas and Mora fields in the southern state of Tabasco, which are estimated to contain combined reserves of about 93 million barrels of light and extra light crude. Cheiron specializes in developing mature fields. Cardenas and Mora are in the second of three areas for which Pemex was seeking partners at Wednesday’s auctions. No bids were made for two shallow-water fields in the Gulf of Mexico—Ayín and Batsil—under a production-sharing contract. Bids for the onshore Ogarrio field are scheduled for later Wednesday. All three auctions are for 50% stakes in the projects. Ayín and Batsil are located in the southern Gulf of Mexico near Pemex’s main offshore-producing region, although at […]

Egyptian Company to Develop Mature Oil Fields With Mexico’s Pemex

5 Oct 2017   Egypt, Mexico

State oil company Pemex’s effort to secure a partner for two shallow-water fields in the Gulf of Mexico fell flat as none of the registered companies presented bids. Cheiron, part of the Pico Group, will join Pemex in the Cárdenas and Mora fields in the southern state of Tabasco, which are estimated to contain combined reserves of about 93 million barrels of light and extra light crude. Cheiron specializes in developing mature fields. Cardenas and Mora are in the second of three areas for which Pemex was seeking partners at Wednesday’s auctions. No bids were made for two shallow-water fields in the Gulf of Mexico—Ayín and Batsil—under a production-sharing contract. Bids for the onshore Ogarrio field are scheduled for later Wednesday. All three auctions are for 50% stakes in the projects. Ayín and Batsil are located in the southern Gulf of Mexico near Pemex’s main offshore-producing region, although at […]

Baker Hughes gets in on Egyptian natural gas bonanza

12 Sep 2017   Egypt

A contract to provide services for the giant Zohr natural gas field off the Egyptian coast is a win-win for its economy and our business, Baker Hughes said. Drilling services company Baker Hughes, a GE company, said during the weekend it secured a contract from Petrobel, a joint venture between a subsidiary of Italian energy company Eni and the Egyptian General Petroleum Corp., for work on underwater production systems for the Zohr field. “The Zohr field is one of the most significant developments of its kind, and through this project we can show the efficiency gains that such complex projects can achieve through our enhanced portfolio,” Lorenzo Simonelli, the president and CEO at Baker […]

Egypt muscling in on global gas production

12 Sep 2017   Egypt

Baker Hughes, a GE company, announced September 9, 2017 a major subsea contract from Petrobel for phase two of the “supergiant” Zohr Gas Field situated in the Mediterranean Sea, off the Egyptian coast. BHGE will provide project management, engineering procurement, fabrication, construction, testing and transportation of a subsea production system, and will support the installation, commissioning and start-up operations. Lasting impact If Zohr delivers on the promise, it would have a lasting impact on Egypt’s gas future and repayment of its $3.5 billion debt to foreign gas companies, a figure quoted by Eng. Tarek El-Molla, Egyptian Minister of Petroleum and Mineral Resources, as reported in Egypt’s state media in February 2017. “The Zohr gas field is playing a major role in the development of Egypt’s domestic energy resources, revenue generation and economic growth,” said Eng. El-Molla, following the recent signing ceremony. Lorenzo Simonelli, president and CEO, BHGE, said: “The […]

Is Egyptian Oil Set For A Rebound?

4 Sep 2017   Egypt

This week Egypt signed three major exploration deals with oil giants Royal Dutch Shell and Apex worth at least $81.4 million. The hefty international contracts will kickstart a large-scale oil and gas exploration in 16 new fields in the oil-rich Western Desert. In a statement released by the Petroleum Ministry, it was announced that Shell will be investing $35.5 million in a single deal, while U.S.-based Apex has signed two different deals totalling $45.9 million, a hefty investment for their first ever projects in Egypt. The deals collectively encompass a massive 1.7 million acres , comprised of the areas of West Badr el Din and South East Meleiha. While Egypt was once a major player in the global oil supply, their production has fallen sharply over the last years as demand has increased, putting them in the unfortunate position of being a net importer after years of being an […]

Egypt Sets Sights on Doubling Natural Gas Output by 2020

18 Jul 2017   Egypt

Three recently discovered major gas fields are expected to raise Egypt’s natural gas output by 50 percent in 2018 and 100 percent in 2020, the petroleum ministry said. “The fields of Zohr, North Alexandria and Nooros are among the most important projects that will increase natural gas production … and will contribute to (Egypt’s) natural gas self-sufficiency by the end of 2018,” Petroleum Minister Tarek El Molla said in a statement, which set out the production forecasts. Egypt’s natural gas production rose to about 5.1 billion cubic feet per day in 2017 from 4.4 billion cubic feet in 2016 with the start of production from the first phase of BP’s North Alexandria project. Egypt has been seeking to speed up gas production […]

At least 23 Egyptian soldiers killed in deadliest Sinai attack in years

10 Jul 2017   Egypt

At least 23 Egyptian soldiers were killed when two suicide car bombs tore through military checkpoints in North Sinai province on Friday, security sources said, in one of the bloodiest coordinated assaults on security forces in years. Islamic State militants are waging an insurgency in the rugged, thinly populated Sinai Peninsula. They have killed hundreds of soldiers and police since 2013, when the military ousted Islamist President Mohamed Mursi after mass protests against his rule. The two cars blew up as they passed through two checkpoints outside of a military compound just south of Rafah, on the border with the Gaza Strip, the security sources said. No group claimed responsibility for the attacks. The security sources said another 26 soldiers were injured in Friday’s attacks. The military put the casualties lower, saying the attacks had killed and injured a total of 26 soldiers, without providing a breakdown of the […]

East Libya forces say they’ve taken full control of Benghazi

6 Jul 2017   Egypt

 Libyan forces in the country’s east say they have cleared the final remaining pockets of the city of Benghazi of Islamist militiamen and armed opponents. The head of the self-styled Libyan National Army, Gen. Khalifa Hifter, says that all that remained were some land mines and bombs to clear. He spoke in televised comments Wednesday. He says his army “congratulates the Libyan people and thanks all the backing forces and neighboring who supported us.” He says: “Benghazi will enter a new era of security, stability, prosperity and peace. Displaced people will return home.” Celebratory gunfire and fireworks rang out in the city’s streets. Libya descended into chaos following the 2011 civil war that toppled and killed dictator Moammar Gadhafi. The oil-rich nation is now split between rival governments and militias.

Rosneft aims to export Egyptian natural gas

24 Jun 2017   Egypt, Russia

Russian energy company Rosneft is expected to start exporting natural gas from an Egyptian field considered to be among the world’s largest. Eni made its initial gas discovery in the Zohr field in Egypt two years ago and quickly described it as the largest ever made in regional waters and potentially the largest in the world. Egypt aims to become a regional hub for gas and liquefied natural gas, though availability at the domestic sector could complicate growth. In December, the Italian company sold off a 30 percent stake in the Egyptian basin to Rosneft in an agreement valued at about $1.6 billion. A source close to the company was quoted by Russian news agency Tass as saying Rosneft aims to deliver gas to regional […]

Egypt To Halve Arrears With Oil Companies In Coming Weeks

30 Mar 2017   Egypt

Egypt expects to cut the $3.5 billion euros it owes to international oil companies by around half in coming weeks, the Egyptian oil minister said on Wednesday. “We have made a lot of progress on paying off arrears,” Tarek El Molla said at an oil and gas conference. The minister also said he expected to finalise an agreement to import crude oil directly from Iraq in a month at the most. “We will import around 1 million barrels a month,” he said. Asked when Egypt might become an exporter of oil and gas, Molla said the country would be self sufficient by the end of 2018. “Starting from 2019 and beyond we can start talking about exporting,” he […]

A New Start For Egypt And Saudi Arabia’s Weathered Relationship

23 Mar 2017   Egypt, Saudi Arabia

Saudi oil shipments to Egypt have resumed after several months of political crisis between Cairo and Riyadh. Egyptian oil ministry sources stated on 19 March that the first two oil shipments from Saudi giant Aramco have been delivered. No reactions were given by Saudi Aramco or officials until now. Egypt expects to receive two other deliveries on March 26-27. Analysts have been watching the crisis between Saudi Arabia and Egypt, as both Arab leaders were in a brawl based on differences on regional politics, the position of Syria’s president Assad and the role of Russia in the region. In April 2016, Saudi Arabia agreed to finance Egyptian imports of refined products from Aramco for five years in a $23 billion deal. In October 2016, Aramco suspended oil deliveries to Egypt after Cairo supported a Russian backed UN Security Council resolution on Syria. Saudi Arabia is a staunch supporter of […]

Egypt moves from electricity deficit to sufficiency

21 Mar 2017   Egypt

The opening of three major power plants in March was the latest in Egypt’s efforts to end its electricity shortage crisis. “Huge work is being done in this country to end the problem,” said Gamal al-Qaluibi, a power engineering professor at Cairo University. “In less than two years, the government managed to end electrical power shortages and even pave the road for surpluses.” When they are operating fully in 2018 as expected, the three electrical power plants, one in the central province of Beni Suef and the others in the new capital being built on the outskirts of Cairo, will produce 14,000 megawatts of electricity every year. In 2013, Egypt produced 24,000 MW but 29,000 MW were needed to bring light to all households, make factory machines run, power equipment at hospitals and […]

Saudi Aramco to resume oil product shipments to Egypt soon

16 Mar 2017   Egypt, Saudi Arabia

Saudi Arabian state oil company Aramco will resume oil product shipments to Egypt some six months after halting them suddenly, the Egyptian Petroleum Ministry said on Wednesday, signaling a potential thaw in relations after months of tension. The ministry said in a statement that it was working with Aramco on a timetable for the resumption of shipments and that the reasons behind the October cut-off were purely commercial. “It was agreed that the Saudi Arabian side would resume Aramco’s shipping of oil products as per the commercial contract signed between the Egyptian General Petroleum Corporation and Aramco,” the statement said. Saudi Aramco could not be reached for immediate comment. “Very shortly we will finalize the time and place for receiving shipments from Aramco,” a ministry official told Reuters, asking not to be identified because he is not authorized to speak to the media. Asked if shipments would resume within […]

These Oil Majors Just Made Egypt Their Highest Priority

17 Feb 2017   Egypt

Since 2011, political instability and regional insecurity have plagued Egypt’s economy, and the energy sector has not been spared. Until recently a net gas exporter, Egypt turned into a net importer in 2014 after political turmoil plunged the country into continued energy shortages, with domestic demand outstripping supply. In addition, shattered investor confidence and several devaluations of the local currency deterred foreign companies from investing in Egypt. But Cairo’s fortunes may have turned in August 2015, when Italy’s oil and gas major Eni SpA discovered Zohr, the largest gas field in the Mediterranean ever to be discovered. Now Eni, as well as UK’s supermajor BP, are betting big on the Egyptian gas exploration and production, and will be making Egypt their top investment destination in the coming years, pouring billions of dollars in their projects there. Eni plans to invest US$10 billion in Egypt over the next five years, […]

Oil companies bullish on Egypt, eyeing more investment, discoveries

15 Feb 2017   Egypt

Major international oil companies say they plan to step up their investments in Egypt, expecting to find more oil and gas now that ENI’s giant Zohr gas discovery has put its Mediterranean waters on the map. Once a net gas exporter, Egypt has turned into a major importer in recent years as growing domestic demand outstripped production, but the discovery of the 850 billion-cubic meter Zohr field in 2015 is expected to change that. The field is expected to come into production by the end of the year and will save Egypt billions of dollars in hard currency that would otherwise be spent on imports. The Egyptian government is also seeking to attract foreign investors as it seeks to transform itself into a gas trading hub for its own and other emerging Mediterranean producers. Marc Benayoun, chief executive of Italian energy group Edison, which is exploring areas near the […]

Eni, BP Pouring More Investment Into Egypt Than Anywhere Else

15 Feb 2017   Egypt

Eni SpA will start producing from the giant Zohr natural gas field off Egypt’s Mediterranean coast by the end of 2017 and plans to invest $10 billion in the North African country over the next five years, Chief Executive Officer Claudio Descalzi said. Production plans for Zohr are on schedule, and Egypt will be Eni’s top country for investment in the next two years, Descalzi said at a conference in Cairo. BP Plc, which bought a 10 percent stake in Zohr from Eni last year, invested more in Egypt in 2016 than in any other country and will do so again this year, the company’s CEO Bob Dudley said at the same event. “Some pretty good things are happening here for BP, like Eni,” Dudley said on Tuesday. “In 2016-17 we’re investing more money in Egypt than any country in the world, so this is important for us, we […]

Egypt to Import LNG With an Eye on Self-Sufficiency in 2018

7 Feb 2017   Egypt

Egypt plans to import as many as 108 cargoes of liquefied natural gas this year as the country prepares to start producing at two gas fields and move closer to its goal of self-sufficiency and even exports by 2019. The North African nation will import 100 to 108 LNG shipments this year, including 43 to 45 cargoes in government-to-government contracts from Oman, Russia’s Rosneft PJSC and France’s Engie SA , according to a person familiar with the matter. The remaining imports will be arranged through a tender to be announced in November, said the person, who asked not to be identified because the information isn’t public. Imports may be reduced in 2018 as BP Plc’s North Alexandria concession works to start gas production in April and Eni SpA ’s giant Zohr field plans to produce by the end of the year, the person said. BP bought a 10 percent […]

Egypt Explores for Natural Gas With Eye on Exports by 2019

3 Feb 2017   Egypt

Egypt may announce new discoveries of natural gas by the second half of this year, Oil Minister Tarek El Molla said, bringing it closer to its goal of self-sufficiency by 2019. Egypt will start exporting natural gas in 2019, Mohamed El Masry, chairman of Egyptian Natural Gas Holding Co ., told reporters in Cairo. It will import 43 to 45 cargoes of liquefied natural gas between March and December this year from Oman, Russia’s Rosneft PJSC, and France’s Engie SA , to be paid over six months, he said. The Arab world’s most populous country relies on imports to meet its energy needs. Costs have risen sharply since November, when the government allowed the pound to float and raised interest rates in a bid to restore confidence in its economy. Rosneft agreed in December to buy as much as 35 percent of the Shorouk concession, joining Eni SpA and […]

How The Saudi Rift With Egypt Is Spiraling Out Of Control

25 Jan 2017   Egypt, Saudi Arabia

Saudi Arabia’s rift with Egypt is spiraling out of control, with major strategic ramifications for both countries, as well as for the Yemen conflict and other Red Sea security challenges. Egypt, Saudi Arabia, the United Arab Emirates, and Kuwait had built solid economic and political ties following the election victory of Pres. Abdul Fatah Saeed Hussein Khalil al-Sisi in May 2014, with promises of extensive economic support for Egypt as Cairo’s relations with the US Barack Obama Administration withered. But Saudi Arabia and the UAE failed to make good on their promises of economic aid to, and investment in, Egypt, while at the same time the Saudi Government put immense pressure on Egypt to support its military offensive in Yemen. The crisis began over Pres. al-Sisi’s refusal to accept the dominance in the Saudi-Egypt relationship of Saudi Minister of Defense & Aviation and Deputy Crown Prince Prince Mohammed bin […]

Egypt set for a gas turnaround

13 Jan 2017   Egypt

The Egyptian natural gas sector is on track for an about-face, though complex dynamics could keep pressure on the industry, Wood Mackenzie found. Italian energy company Eni in December secured the bulk of the new exploration and production concessions offered by the Egyptian government during the latest bidding round . The company made its initial gas discovery in the Zohr field in August 2015 and quickly described it as the largest ever made in regional waters and potentially the largest in the world. A profile of the Egyptian gas sector from consultant group Wood Mackenzie finds the sector is on pace for a profound change in the next five years. “After swinging from the world’s eighth […]

The Two Nations Racing To Host The Next Oil And Gas Rush

29 Dec 2016   Cyprus, Egypt

Bit of a quiet week for major resource news. But several small items are suggesting some potentially explosive developments coming over the next several months. One of those comes in a place I’ve been watching closely the past year: the tiny Mediterranean island of Cyprus . Which this past week announced the winning bidders for an offshore licensing round — handing out acreage that could be prospective for some of the world’s largest natural gas targets. Cyprus’s Ministry of Energy, Commerce, Industry, and Tourism said it has awarded three offshore blocks — one to Italy’s Eni, one to an Eni/Total partnership, and the other to ExxonMobil and Qatar Petroleum. That’s big news because these licenses lie just kilometers away from Egyptian waters where Eni discovered the 30 trillion-cubic feet Zohr natural gas field — one of the biggest petro-finds in recent history. Eni and a slate of fellow majors […]

Eni gains stronger position in Egypt

29 Dec 2016   Egypt

Italian energy company Eni said it continued its track record of success in the Mediterranean Sea by securing two new agreements in an Egyptian auction. Eni secured the bulk of the new exploration and production concessions offered by the Egyptian government during the latest bidding round. Both agreements cover acreage in the shallow waters of the Mediterranean Sea. Those agreements follow blocks awarded onshore in the Western Desert and in the deep waters of the Mediterranean. “They strengthen Eni’s portfolio and positioning in Egypt, a country of historic and strategic importance, and further confirm the company’s commitment to pursue new exploration,” the company said in a statement . Eni serves as the operator of the two fields in partnerships that include British energy company BP and French supermajor Total as minority players. The company offered no reserve estimate for the new concessions, but […]

Eni to sell 30 percent stake in Egyptian gas field to Rosneft

13 Dec 2016   Egypt

Italian energy company Eni has agreed to sell a 30 percent stake in a giant Egyptian offshore gas field to Russia’s Rosneft for $1.575 billion, pressing ahead with asset sales to fund investment amid weak oil prices. Eni, which currently owns 90 percent of the Shorouk concession containing the giant Zohr gas field, said Rosneft would pay $1.125 billion cash for the stake and would reimburse investments already carried out by Eni for around $450 million. Rosneft also has an option to buy a further 5 percent stake. Selling down stakes in oil and gas fields it operates is part of Eni’s so-called “dual exploration” strategy to raise cash […]

Shell Discovers 500 Billion Cubic Feet of Natural Gas in Egypt’s Western Desert

5 Dec 2016   Egypt

New natural gas discoveries were made earlier this month in Egypt’s western desert, announced Royal Dutch Shell plc, commonly known as Shell. The discoveries were made in Alam El-Shawish concession area. Initial estimates indicate that 500 billion cubic feet of natural gas was discovered, with more possible reserves yet to be uncovered, announced the CEO of Shell in Egypt, Eden Murphy, in a statement. The discovery could produce between 10 and 15 percent of the total production of Badr el-Din Petroleum, which is a joint venture that acts on behalf of Shell and the Egyptian General Petroleum Corporation. …The discovery is one of the largest in Egypt’s western desert in recent years…

Egypt: Cairo Governor Raises Taxi Fares Following Increase in Fuel Prices

24 Nov 2016   Egypt

The Cairo Governor announced on Tuesday that taxi fares’ initial charge will increase from EGP 3 to EGP 4, along with an increase in the rate per kilometer from EGP 1.4 to EGP 1.75, in the wake of a surge in the prices of fuel. Taxi drivers called on the cabinet earlier this month to adjust the fare in accordance with the recent hikes in energy and fuel prices. The government raised fuel prices by up to 47 percent on November 4, hours after the Central Bank decided to float the currency. Both measures were seen as part of an economic reform package that aims to reduce the budget deficit and the public debt. According to the Petroleum Ministry, the prices for 80 octane gasoline increased to reach EGP 2.35 per litre instead of EGP 1.6, and 92 octane gasoline increased to EGP 3.5 instead of 2.6 […]

Kuwait Said to Renew Contract to Supply Crude Oil to Egypt

18 Nov 2016   Egypt, Kuwait

Egypt to get 2 million barrels of Kuwaiti crude a month Shipments not meant to make up for Egypt’s loss of Saudi fuel Kuwait renewed a contract to supply Egypt with crude oil for the next three years, according to a senior Kuwaiti government official, who said the shipments are not intended to make up for the loss of Saudi fuel shipments to the North African country. Egypt will get 2 million barrels of Kuwaiti crude a month starting Jan. 1, according to the official, who asked not to be identified because the contract wasn’t announced publicly. The contract is for three years and the supplies will be based on international prices, he said. The contract is an extension of the current agreement between the two countries, the official said. Saudi Arabian Oil Co., known as Saudi Aramco, has halted shipments of oil products to Egypt since October, forcing […]

A Seismic Shift In The Middle East: Saudi Arabia Cuts Off Egyptian Oil

10 Nov 2016   Egypt

While the proxy war in the middle-east rages, a curious, and largely under the radar pivot has been taking place in one of the countries directly impacted by Hillary Clinton’s foreign policy: Egypt. In mid-October, we reported that , for the first time ever, Russia and Egypt would conduct joint military drills. This followed news that Russia will sell attack helicopters to the North African nation and invest billions in Egyptian infrastructure. These items, along with the fact that Egypt is eager to be re-granted Russian tourism rights for its citizens after recent bad blood between the countries, lead one to the logical conclusion that Egypt has every incentive to cooperate with Russia going forward. This means when the Russian fleet reaches the Mediterranean – whether the intent is to park in those waters and bombard Aleppo, as some believe, or merely to project Russian might to the world, […]

Egypt just massively devalued its currency — here’s what happens next

7 Nov 2016   Egypt

Egypt’s central bank floated the pound on Thursday in an attempt to stabilize its economy, which has been hampered by a shortage of dollars. The currency was initially devalued by 32.3% to about 13 pounds per dollar, down from the previous peg of 8.8 per dollar, which had been in place since March. It has since tumbled further, and is now down by about 50%. At the same time, the central bank also hiked rates by 300 basis points in an attempt to curtail the inflation that’s likely to follow the weaker exchange rate. The devaluation of the pound was one of the key demands by the International Monetary Fund in order for Egypt to receive a loan of $12 billion over three years. The IMF has yet to officially ratify the loan, but it is seen as crucial in helping to stabilize the country’s economy. As for what […]

Saudi oil shipments to Egypt halted indefinitely, Egyptian officials say

7 Nov 2016   Egypt, Saudi Arabia

Saudi Arabia has informed Egypt that shipments of oil products expected under a $23 billion aid deal would be halted indefinitely, suggesting a deepening rift between the Arab world’s richest country and its most populous. Saudi Arabia agreed to provide Egypt with 700,000 tonnes of refined oil products per month for five years in April, during a visit by King Salman. The cargoes stopped arriving at the start of October, as festering political tensions burst into the open, but Egyptian officials said the contract remained valid and had appeared to hold out hope that oil would start flowing again soon. Saudi Arabia’s state oil firm Aramco has not commented on the halt. But […]

Egypt’s oil minister makes rare trip to Iran for oil talks after Saudi suspension

7 Nov 2016   Egypt, Iran

Tarek El Molla, Egypt’s Minister of Petroleum and Mineral Resources, is seen during a meeting with Cypriot Foreign Minister Ioannis Kasoulides at the Ministry of Foreign Affairs in Nicosia, Cyprus August 31, 2016. Egyptian Petroleum Minister Tarek El Molla was on his way to Iran on Sunday to try to strike new oil deals, sources close to his delegation said at Cairo airport, after Saudi Arabia suspended its oil agreement last month. After that suspension, Egypt voted in favor of a Russian-backed U.N. resolution on Syria in October that excluded calls to stop bombing Aleppo, which Saudi Arabia strongly opposed. Saudi Arabia has showered Egypt with billions of dollars in aid since 2013, when President Abdel Fattah al-Sisi ousted elected Mohammed Mursi of the Muslim Brotherhood and banned the Islamist movement, which Riyadh opposes. The Saudi deal was for 700,000 tonnes of oil products a month for five years […]

Egypt Non-Oil Business Activity Falls to Lowest Since 2013

3 Nov 2016   Egypt

Business activity in Egypt hit its lowest level in more than three years in October, shrinking for a 13th month amid a foreign currency shortage, the pound’s weakness in the black market and accelerating inflation. The Emirates NBD Purchasing Managers Index for non-oil activity fell to 42 from 46.3 the month before, the weakest since July 2013, according to report released Thursday. A level below 50 represents a contraction in business activity. On Thursday morning, free-floated the pound, fulfilling a key condition to finalizing a $12 billion loan from the International Monetary Fund. The survey “highlights the increasingly difficult operating environment confronting Egyptian private sector firms,” Jean-Paul Pigat, senior economist at Emirates NBD, said in the report. “It is difficult to see the situation improving before an IMF agreement is signed, as the ongoing FX shortage and EGP weakness on the parallel market are the main factors undermining economic […]

Egypt Wants Inquiry Into Suspended Saudi Oil Shipments

25 Oct 2016   Egypt

The Energy Committee of the Egyptian Parliament plans to contact its Ministry of Petroleum to get to the bottom of why the petroleum shipment from Aramco was suspended earlier this month. The news came from sources within the Egyptian Parliament, and according to that source, the Ministry will be asked to review Aramco’s five-year agreement to supply Egypt with petroleum derivatives. Egyptian Parliament has reportedly asked Petroleum Minister Tarek El Molla and the chairperson of the Egyptian General Petroleum Corporation (EGPC) to meet with Committee members this Sunday. Hamada Ghallab said that the purpose of the meeting will be to determine why shipments were suspended, and to get an outlook for subsequent shipments in November. Ghallab added that the committee will ask the Ministry of Petroleum to encourage foreign investment in oil fields in order to boost production in exchange for such things as providing facilities, […]

Egypt Presses Oil Companies for More Time to Pay for Fuel

14 Oct 2016   Egypt

Egypt has asked energy suppliers… Egypt is pushing big energy companies to give it a break on payments for fuel shipments after Saudi Arabia’s sudden decision in October to halt artificially cheap petroleum deliveries tightened an economic squeeze in the North African nation. Egypt, one of the biggest global importers of commodities ranging from wheat to diesel fuel, is struggling to pay oil companies ahead of trying to make the world’s largest-ever short-term deal for liquefied-natural gas. At a meeting in Cairo on Wednesday, Egypt asked energy suppliers to give the country six months instead of three months to come up with the money for already-ordered deliveries of LNG, crude oil and petroleum products, an Egyptian government official said. The official didn’t specify which companies were at the meeting. Egypt’s biggest energy suppliers include BP BP -0.31 % PLC, […]

Egypt Says Saudi Fuel Shipment Freeze Is Unrelated to UN Spat

14 Oct 2016   Egypt, Saudi Arabia

Tensions over Syria sparked fears IMF loan would be delayed El-Sisi says oil product shipments are commercial matter Egyptian President Abdel-Fattah El-Sisi said Saudi Aramco’s decision to halt oil product shipments to Egypt wasn’t a retaliation for his government’s position on the war in Syria. The shipments are determined by commercial agreements and “we do not know companies’ circumstances,” El-Sisi was quoted as saying by the state-run Ahram Gate news website on Thursday. “We will take the appropriate position,” he said, without giving further details. Egypt’s support for a Russian-drafted UN Security Council resolution on Syria over the weekend earned a rare public rebuke from Saudi Arabia, which has provided Egypt with billions of dollars in aid since the 2013 ouster of Islamist President Mohamed Mursi. The dispute triggered investor fears that Saudi Arabia would withhold or cancel a $2 billion payment Egypt needed to secure a crucial International […]

Egypt Stocks Fall on Signs of Deepening Rift With Saudi Arabia

12 Oct 2016   Egypt, Saudi Arabia

Suspension of Aramco aid confirmed by Egyptian Oil Ministry Egyptian pound plunges to record in black-market trading Egyptian stocks declined for a second day and the currency fell to a record low on the black market after Saudi Arabia suspended a fuel-aid program, prompting concern among investors of a deeper dispute with one of the country’s key financial backers. The benchmark EGX 30 Index lost 1.6 percent, the most since Sept. 15, to 8,232.77 at the close in Cairo. About 678 million Egyptian pounds ($76 million) of shares traded, 21 percent more than the market’s three-month daily average. The Egyptian pound weakened to its lowest level since the start of a weekly Bloomberg poll of unregulated trading in 2013. The Saudi decision, for which no official reason was announced, follows Egypt’s vote in the United Nations in favor of a Russian-drafted resolution on Syria that the kingdom opposed. Egypt […]

Egypt Begins Receiving Imports From Unspecified Source After Aramco Debacle

12 Oct 2016   Egypt

Egypt received oil shipments from an unspecified source on Tuesday, according to Petroleum Ministry spokesperson Hamdy Abdelaziz, who said the move came after Saudi Aramco decided it would suspend delivery of energy products to the North African country. Abdelaziz said to Mada Masr that this month’s delivery failure “does not mean that the entire import agreement with Aramco will be canceled, since the halt may be due to technical or logistical reasons, which are normal in all economic agreements.” The current deal between Aramco and the Egyptian government brings the equivalent of 700,000 barrels of fuel per month to Egypt at a cost of $23 billion for 15 years. The news site also contacted two different sources from the Saudi company, both of whom chose to remain anonymous. One of the sources said the halt occurred due to technical reasons, but the agreement will still function […]

Saudi Aramco To Suspend Refined Oil To Egypt

11 Oct 2016   Egypt, Saudi Arabia

Saudi Aramco informed Egypt’s state-held Egyptian General Petroleum Corporation (EGPC) that it would suspend the delivery of refined oil products to Egypt, Reuters reported on Monday, quoting a government official. In April of this year, Saudi Aramco and EGPC entered into a US$23-billion deal , under which Saudi Arabia would deliver to Egypt 700,000 tons of petroleum products per month, as part of financial support for Egypt. Last Friday, October 7, traders had told Reuters that Egypt had not received the October share of petroleum products from Saudi Arabia. On Saturday, October 8, the Egyptian ministry of petroleum issued a statement saying that it had not received any official correspondence from Aramco regarding the status of supplies. EGPC has contracted additional amounts to meet its domestic demand and keep strategic petroleum product stocks, the statement noted. “Aramco informed the EGPC early this month of its inability to supply Egypt […]

Shell announces new natural gas discoveries in Egypt’s Western Desert

1 Sep 2016   Egypt

Logos of Shell is pictured at a gas station in the western Canakkale province, Turkey April 25, 2016. Royal Dutch Shell announced on Wednesday new natural gas discoveries in a concession area of north Alam El-Shawish in Egypt’s western desert. The initial quantities discovered were estimated at about half a trillion cubic feet of gas with more possible reserves, Eden Murphy, chairman and CEO of Shell said in a statement. The discovery could produce from 10 to 15 percent of the total production of Badr el-Din Petroleum company, which is a joint venture acting on behalf of the state-owned Egyptian General Petroleum Corporation (EGPC) and Shell in production operations, Murphy added. Shell owns the license of the entire area, which includes the well. Badr el-Din is expected to manage the operations. (Reporting by Alaa Roushdy; Editing by Ruth Pitchford)

Fuel Subsidy Regime Falls Like Dominoes Across Middle East

26 Aug 2016   Egypt

Two weeks ago, news broke that the International Monetary Fund had reached a “tentative” agreement with Egyptian officials regarding a $12 billion loan that the Washington-based pool would pay out over the next three years. The IMF’s Egypt mission chief, Chris Jarvis, said, “Egypt is a strong country with great potential but it has some problems that need to be fixed urgently.” One of those problems, it turns out, is the country’s fuel subsidies. Reuters reported on Tuesday that Egyptians will pay 65 percent of the actual cost of fuel at pumps during the 2016-17 fiscal year, and by the time the IMF distributes the last portions of its massive loan in 2020, the fuel subsidies will be completely dismantled. To be clear, the fuel subsidy cuts do not represent a new political position in Egypt. In October 2014, Acting President Adly Mansour released a five-year […]

Egypt plans to end fuel subsidies within three years: sources

24 Aug 2016   Egypt

Egypt plans to end fuel subsidies within three years and is aiming to increase fuel prices to 65 percent of their actual cost during the 2016/17 fiscal year, two government sources told Reuters on Tuesday. Struggling to revive its economy after an uprising in 2011 shook investor confidence and drove tourists and foreign investors away, Egypt has been trying to cut spending on subsidies because they eat into its state budget. Egypt has reached a staff level agreement with the International Monetary Fund (IMF) for a $12 billion three-year loan program which is subject to final approval by the IMF executive committee. Disbursement is linked to progress on a variety of reforms including cuts in subsidies, the introduction of value-added tax (VAT) and a shift to a more flexible exchange rate regime. “What was agreed lately with the IMF delegation in Egypt is cancelling fuel subsidies within three years,” […]