Egypt awards new gas exploration rights to Italy's ENI

Ahram Online, Thursday 25 Sep 2014

Three blocks in the Western Desert and Mediterranean should help Egypt cope with rising energy demands

Courtesy: Egyptian Natural Gas Holding Company

Italian multinational oil and gas company ENI announced on Thursday that it has won three concessions in Egypt's Western Desert and the Mediterranean in bids held in December of last year.

The Egyptian General Petroleum Corporation (EGPC) awarded ENI full operationship of an onshore block located in the Western Desert, covering an area of 2,058 square km, said a statement from EGPC.

In addition, Egyptian Natural Gas Holding Company (EGAS) awarded ENI two deep-water blocks near Cyprus' nautical border in the Mediterranean Sea.

ENI will be fully responsible for operations in the North Leil offshore block, which covers 5,105 square km, at a depth ranging from 2,100 to 2,800 metres.

British Petroleum will be ENI's partner in the second Mediterranean block, Karawan offshore, covering 4,565 square km at a depth ranging from 2,000 to 2,500 metres.

Last week, Egypt signed exploration deals worth $187 million for areas in the Suez Canal, the Western Desert, the Mediterranean Sea and the Nile Delta.

Egypt has been plagued with energy shortages as its gas production dropped 17 percent year-on-year in July, while its exports fell 73.4 percent.

The government has been struggling in past years to repay accumulated debt to foreign oil companies operating in the country, which has allowed demand to outstrip production in the Arab world's most populous nation.

Earlier this month, Petroleum Minister Sherif Ismail announced that Egypt was borrowing $1.5 billion from local and international banks in order to repay the debt, which currently stands at some $6 billion.

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