Ramping up gas production in Egypt

In spite of the global slowdown in capital spending by energy companies, Egypt’s upstream gas industry is attracting multi-billion-dollar investments as it looks to meet rising domestic demand.

With low production costs, well-developed infrastructure and several offshore gas fields currently under development, prospects are good for Egypt to regain self-sufficiency in the medium term.
A major discovery

In late February the Ministry of Petroleum and Mineral Resources gave the approval for state-owned Egyptian Natural Gas (EGAS) to grant Italy’s Eni the development lease for the super-giant Zohr offshore gas field, located in the Shorouk concession of Egypt’s Sohar basin in the Mediterranean.

Discovered in August, the 100-sq-km Zohr field is the largest to be discovered to date in either Egypt or the broader Mediterranean, according to Eni officials, with an estimated 850bn standard cu metres (scm) of gas.

Eni plans to start production at the field by the end of 2017, ramping up output to around 75m scm – or approximately 500,000 barrels of oil equivalent – per day by 2019.

Initial investment in the Zohr field is projected to cost around $3.5bn, with the company expecting to dedicate $6bn-10bn to overall development.