Oil majors are investing USD 1.8 bn in gas exploration here: Multinational energy firms Eni, Chevron, ExxonMobil, Shell, and BP will spend a combined USD 1.8 bn to drill 35 gas exploration wells in the Mediterranean and Nile Delta over the next two years, Oil Minister Tarek El Molla is quoted as telling Emirati news agency WAM on the sidelines of the OPEC+ meetings in Vienna yesterday.

We don’t have the details yet: The companies will drill 21 wells during the current 2023-2024 fiscal year and another 14 next fiscal year, El Molla is quoted as saying. He didn’t clarify whether they would be drilling at their existing concessions or if the plans include wells set to be drilled in new exploration areas.

New blocks are up for grabs: EGAS' ongoing bid round for 12 exploration blocks in the Mediterranean and Nile Delta will close on 15 July. The tender is the first of three the government plans to run this year, El Molla said in March, adding that the state had formed an “ambitious” plan” to drill over 300 exploration wells with international partners by 2025. A month earlier, he said he expected to see some USD 8 bn in investments in oil and gas exploration in 2023 alone.

All of these players have already said they’re keen to invest:

  • Italian energy giant Eni holds a 50% stake in the Damietta LNG plant and produces around 60% of the country’s gas. Earlier this year it saidit had made a “significant” gas discovery in the Eastern Mediterranean in cooperation with Chevron. Eni will soon start drilling an exploration well at its Mediterranean North East Hap’y concession.
  • Chevron is looking to expand its exploration operations in Egypt after stepping up its presence in the EastMed hydrocarbon sector, purchasing a 40% stake in Israel’s Leviathan field and 25% of Tamar in recent years. It’s also investing to exploit Cyprus’ Aphrodite field with its partners Shell and Israel’s NewMed Energy, with plans to export much of that gas to Egypt for liquefaction.
  • BP produces a significant chunk of our total gas supply and was awarded two more Mediterranean concessions late last year.
  • ExxonMobil has a long history of exploration here and earlier this year acquired two offshore blocks in the Nile Delta.
  • Shellhas said it wants to boost its operations in Egypt.

REMEMBER- The Madbouly government is targeting oil and gas exports of USD 21 bn for the year, up 15% from USD 18.2 bn in 2022. The state is targeting another c.15% increase in 2024 to USD 24 bn.

More gas = more hard currency: The government has sought to maximize gas proceeds to alleviate the FX crunch triggered by the war in Ukraine, and last year began rationing domestic consumption in order to increase exports. 

Correction: 5 July 2023 

A previous version of this article incorrectly stated that EGAS' ongoing  bid round closed last month.

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