New natural gas discoveries are being made in the East Mediterranean
The Italian energy company Eni is accelerating the search for large quantities of natural gas after the discovery of a new natural gas field in Egypt.
The discovery of a new gas field in the Eastern Mediterranean in the Narges area topped the agenda of discussions held between the Italian company and Minister of Petroleum Tarek Al-Molla on the sidelines of the Egypt International Petroleum Conference and Exhibition (EGYPS 2023) last week.
During the EGYPS, both parties discussed accelerating the development of the new gas discovery being evaluated in the offshore Narges area in the Mediterranean Sea in partnership with the US Chevron and Egyptian companies.
The new discovery, announced in January, is located in the Eastern Mediterranean off the Egyptian coast. The Narges 1 well was drilled to a depth of 309 m and has an estimated volume of reserves amounting to 2.5 trillion cubic feet of gas. This has contributed to the interest of a number of international companies to develop the field and work on more explorations.
The discovery of the new gas field comes at a time when Egypt is seeking to increase its gas reserves and exports for which demand has grown worldwide.
Egypt expects to produce about eight million tons of liquified natural gas (LNG) this year, in line with production rates of 2022, with more production expected in the coming years backed by new discoveries.
The country increased its LNG exports by 14 per cent in 2022 compared to 2021 to reach 7.5 million tons of LNG, with around 80 per cent delivered to EU markets to fill the gap left by the drop in Russian gas and EU plans to transition away from Russian supplies.
LNG plants in Egypt are operating at less than full capacity and could be expanded, Al-Molla said during the EGYPS, adding that there are plans to double their capacity of around 13 million tons.
The Ministry of Petroleum and Mineral Resources has announced its approval of new investments planned in the Zohr Gas Field in the Mediterranean during the 2023-24 fiscal year estimated at about $1.2 billion.
The ministry announced that the investments include the implementation of a plan to intensify development activities by expanding the drilling of new wells, as well as the maintenance of existing ones.
In December, the ministry announced that Egypt had produced about 50.6 million tons of natural gas during 2022. A record amount of natural gas had been exported, amounting to about eight million tons in 2022 compared to about seven million in 2021.
Increases in LNG prices globally led the value of Egyptian exports of natural gas in 2022 to reach about $8.4 billion compared to about $3.5 billion in 2021, an increase of about 140 per cent.
Since achieving self-sufficiency in natural-gas production and consumption in 2018, Egypt has planned to use its position to become an energy hub and a major supplier of LNG to the EU as well as other countries.
This has been backed by huge gas discoveries, most notably the Zohr Field, which contains an estimated reservoir of 30 trillion cubic feet of gas and has attracted the interest of more foreign investment in the country’s energy sector.
Al-Molla also witnessed the signing of 16 memorandums of understanding (MoUs) and cooperation agreements during the EGYPS last week between the petroleum sector and a number of international companies in the framework of expanding partnerships, providing new opportunities for Egyptian oil-sector companies, supporting digital transformation activities, achieving environmental sustainability, and reducing carbon emissions.
The MoUs also included agreements to assess waste for converting it into sustainable jet fuel, assessing the available quantities of marine and solid waste, looking at carbon dioxide from some industries, and assessing low-carbon hydrogen in order to convert it into sustainable biofuels.
Other agreements included the implementation of modern systems for managing occupational safety, health, and environmental protection on drilling platforms, in addition to a framework agreement to support digital transformation projects and provide the latest solutions for securing and protecting the infrastructure of the oil and gas sector.
* A version of this article appears in print in the 23 February, 2023 edition of Al-Ahram Weekly