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Natural gas production from the huge Zohr field in the eastern Mediterranean offshore Egypt more than tripled in the first half of 2019 compared to the same period in 2018, Russia’s oil giant Rosneft, which holds 30 percent in the field, said on Wednesday.
Production at Zohr reached 11.3 billion cubic meters of gas in the first half of this year, which was 3.6 times more than in the same period last year, Rosneft says. Current production levels stand at 68 million cubic meters per day (2.4 billion cubic feed per day), while output is expected to increase to 76 million cubic meters per day (2.7 billion cubic feed per day) by the end of this year, the Russian company said, noting that “Middle East projects implementation is one of Rosneft’s strategic development areas.”
In recent years, Egypt has been at the center of a ‘natural gas rush’ in the eastern Mediterranean after Italy’s major Eni discovered the huge Zohr field in 2015, saying it was the largest ever gas discovery in the Mediterranean. Eni is the operator of Zohr and holds 50 percent, Rosneft has 30 percent, while BP and Mubadala Petroleum each have 10 percent in the Shorouk Block where Zohr is located.
By September 2018, natural gas production at Zohr had increased to 2 billion cubic feet per day (bcfd) from 350 million bcfd when it began commercial production in January 2018—a six-fold increase since the start-up. Last year in September, Eni said that it would aim to reach plateau production in excess of 2.7 bcfd in 2019.
“We expanded our production capacity organically, by growing mainly in Egypt where the Zohr field is approaching full plateau,” Eni’s chief executive officer Claudio Descalzi said in the company’s first-half results release last month.
Following the start-up of the giant Zohr field in early 2018, Egypt became an important player in the Mediterranean. Zohr plays a key role in helping Egypt to avoid the need to import liquefied natural gas (LNG), according to the Italian energy major.
By Tsvetana Paraskova for Oiprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.
Not only it has boosted Egypt’s proven reserves of gas to 75.5 trillion cubic feet (tcf) making them the third biggest in Africa but it has made Egypt self-sufficient in gas well into the future and will also enable it to return to being a gas exporter this year.
Egypt under the leadership of President Abdul Fattah el-Sissi is having an energy renaissance. Not only it has created a good investment climate to encourage more international investment, it has also emerged as the energy hub of the Eastern Mediterranean with a re-emergence of interest in its gas potential by the oil supermajors like Shell, ExxonMobil BP an ENI.
It is also planning to boost its crude oil production from the current 615,000 barrels a day (b/d) according to the 2019 BP Statistical Review of World Energy to 690,000 b/d by the end of the year. This will enable Egypt to become almost self-sufficient in oil and this will help it reduce its budget deficit.
Moreover, Egypt stands a very good chance of discovering significant volumes of oil and gas in the Red Sea area with a flurry of applications for exploration.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London