• 3 minutes Shale Oil Fiasco
  • 7 minutes "Leaked" request by some Democrats that they were asking Nancy to coordinate censure instead of impeachment.
  • 12 minutes Trump's China Strategy: Death By a Thousand Paper Cuts
  • 16 minutes Global Debt Worries. How Will This End?
  • 2 hours americavchina.com (otherwise known as OilPrice).
  • 1 day Everything you think you know about economics is WRONG!
  • 1 day Wallstreet's "acid test" for Democrat Presidential candidate to receive their financial support . . . Support "Carried Interest"
  • 2 days Democrats through impeachment process helped Trump go out of China deal conundrum. Now Trump can safely postpone deal till after November 2020 elections
  • 2 hours Forget The Hype, Aramco Shares May be Valued At Zero Next Year
  • 8 hours Natural Gas
  • 5 hours Joe Biden, his son Hunter Biden, Ukraine Oil & Gas exploration company Burisma, and 2020 U.S. election shenanigans
  • 2 days Judiciary impeachment: Congressman says Sean Misko, Abigail Grace and unnamed 3rd (Ciaramella) need to testify.
  • 15 hours Winter Storms Hitting Continental US
  • 1 day 2nd Annual Great Oil Price Prediction Challenge of 2019
  • 2 days Quotes from the Widowmaker
  • 2 days Tesla Launches Faster Third Generation Supercharger
  • 4 hours My interview on PDVSA Petrocaribe and corruption
Alt Text

Global LNG Markets Are Circling The Drain

Asian and European LNG prices…

Alt Text

Aramco Looks To Build An LNG Fleet

Aramco’s shipping division has expressed…

Alt Text

Natural Gas Set To Fall Even Further

Natural gas prices are likely…

Oxford Business Group

Oxford Business Group

Oxford Business Group (OBG) is a global publishing, research and consultancy firm, which publishes economic intelligence on the markets of the Middle East, Africa, Asia…

More Info

Premium Content

Egypt Takes Giant Step Towards Energy Independence

The first flow of gas from the offshore Zohr gas field, located 200 km north of Port Said, is expected in December, according to government officials.

Speaking in October, Tarek El Molla, minister of petroleum and mineral resources, said development of the field was 91 percent complete. Initial production is forecast at around 500m-1bn cu feet per day (cfpd), with output projected to rise to 2.7bn in 2019 once all seven fields are operational.

International majors take stakes in Zohr development

Discovered by Italian energy company Eni in 2015, the Zohr field has 30trn cu feet of estimated reserves, making it one of the largest finds to be developed in recent years.

The project has generated significant investment interest, with Russian energy giant Rosneft buying a $1.1bn stake in the field from Eni in October. The Italian firm will hold 60 percent of the development, with Rosneft taking 30 percent and BP 10 percent.

Less than a month after this announcement came the news that a second large-scale gas development is scheduled to come on-line before the end of the year.

The Atoll Phase One project, an offshore joint venture between the Egyptian Natural Gas Holding Company and BP, contains estimated reserves of 1.5trn cu feet of gas and 31m barrels of condensates. Initial production is expected to deliver 300m cfpd to the domestic market in the first quarter of 2018.

Increased production at existing fields boosts gas output

The new flows come on the back of heightened activity in 2017, as gas output rose steadily at existing fields.

In May BP began production at two of the five fields that make up the North Alexandria and West Mediterranean deepwater offshore concession blocks, with the initial take pumped directly into the national grid. The 700m cfpd from the Libra and Taurus fields has helped raise Egypt’s daily gas production to an average of 5.1bn cu feet, up from 4.4bn in 2016.

Once the five fields are fully operational in 2019, BP expects output will reach 1.5bn cfpd, further increasing the country’s production capacity.

Gas surplus could see Egypt resume export role

The increase in domestic gas production is already helping to curb Egypt’s energy imports, alleviating pressure on foreign currency reserves, reducing government expenditures and supporting broader economic growth. Related: Who Will Win The Self-Driving Taxi Race?

In September government officials said liquefied natural gas imports – which cost roughly $1.8bn per year – would be reduced by 32.2 percent to 80 cargoes in FY 2017/18.

Egypt hopes to achieve natural gas self-sufficiency by the end of 2018, according to El Molla. He told local media the country was eyeing a gas surplus by 2020, raising the possibility that it could begin exporting again.

Egypt was a net energy exporter for many decades; however, a drop in production and increased domestic demand in the late 2000s saw the 95m-person country become increasingly reliant on imports.

Energy consumption drivers

This transition came about as a result of growing natural gas consumption, driven primarily by rising demand in the power and industrial sectors.

Domestic electricity generation already consumes between half and two-thirds of gas output, and has been under upward pressure as a result of high population growth; the country is expanding by around 1.5m-2m people per year.

According to the 2017 BP Statistical Review of World Energy, Egypt’s natural gas consumption increased by 7 percent in 2016 to reach 51.3bn cu metres – almost double the average annual growth rate of 4.2 percent in 2005-15.

Consumption levels are particularly high in the hot summer months; in August of this year, for example, gas usage at the country’s power plants rose from 99m cu metres per day to around 110m when temperatures spiked, according to the Ministry of Petroleum.

By Oxford Business Group

More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment
  • John Brown on December 04 2017 said:
    I keep seeing the price of oil rise as OPEC and Russia play their games trying to idle more capacity which never seems to be enough to eliminate the glut of oil and natural gas sloshing around the world. I wonder why the price of oil is near or just over $60 when there is a glut, despite all the idled capacity. I even read an article speculating on $80 a barrel oil next year assuming the world economy improves with the USA leading the way. Then I read the reality that U.S. production with WTI at near $60 is set to explode, and a country with a huge population like Egypt has production soaring and will no longer need to import. Everywhere you look you see a glut of oil, idling capacity waiting to come online, more production and not just in the USA, and renewable energy continuing to creep up as a percentage of market share.
    So my only question is why is oil selling above the $30 to $40 dollar range, and why would it go up rather than down with all the current trends in favor of more and more supply of oil and gas being available, and more and more capacity idled just sitting there in a desperate attempt to lift prices?

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play