Egypt has approved an exploration agreement with Italy’s Eni and the Egyptian Tharwa company to search for oil and gas in the Mediterranean off the coast of northern Sinai, the Egyptian oil minister said on Wednesday.
Under the deal, Eni and Tharwa will spend $105 million in two stages over six years, which involve drilling one well in the first stage and another in the second, Minister Tarek El Molla told journalists.
The inked deal comes a few days after Eni announced a new oil discovery at the A-2X exploration prospect, located in the South West Meleiha license in Egypt's Western Desert.
The discovery was made in the first well drilled by Eni to explore the deep geological sequences of Faghur Basin.
The Italian gas giant is best known for the 2015 discovery of Egyptian mammoth Zohr gas field -- the largest offshore field in the Mediterranean.
In January 2018, Egyptian President Abdel-Fattah El-Sisi attended the inauguration of the first stage of production at the super giant gas field. Eni announced last week the start of production at the field's second production unit (T-1), which will pump at a production capacity of 400 million standard cubic feet per day (MMSCFD).
Egypt hopes to halt gas imports by 2019 and achieve self-sufficiency in gas.
It has rapidly increased its production of natural gas and hopes to become a hub for exporting to Europe after making a series of big discoveries in recent years, including Zohr.
Egypt is targeting about $10 billion in foreign investment in the oil and gas sector in the 2018/19 fiscal year, which begins in July, according to statements by the oil minister last month.