Egypt has awarded British Petroleum (BP) two new exploration blocks to which the company and its partners have committed investments worth $240 million, the company announced on Tuesday.
The deal, which comes out of Egypt's 2013 bid round, includes rights to the North El-Mataria onshore block in the north-eastern Nile Delta, some 57km to the west of Port Said city, which BP will operate with 50 percent equity, with Dana Gas holding the other 50 percent.
The Karawan offshore block in the Mediterranean Sea, located 220km north east of Alexandria will be operated by BP and ENI, with a 50-50 equity split.
The exploration is expected to proceed over a period of 6-8 years.
"Our expertise and latest technologies will be deployed for mutual benefit in these new blocks, which we believe have gas-bearing characteristics. Exploring the two blocks will require substantial investments to unlock their potential, and will be done as part of our commitment to meeting Egypt's energy needs," said Hesham Mekawi, BP North Africa Regional President.
Egypt has suffered an energy crisis in recent years, most evident in frequent electricity blackouts. Several government officials have attributed the power cuts to a growing fuel subsidies bill and declining gas production.
In September, the government awarded exploration blocks worth $187 million in investments to foreign oil and gas companies.
BP produces ten percent of Egypt's annual oil and condensate production, in collaboration with the Gulf of Suez Petroleum Company (GUPCO), and BP's joint venture company with the Egyptian General Petroleum Company (EGPC), said the company.
The company has invested over $25 billion in Egypt over the past 50 years in oil and gas exploration and production.