During the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC 2023), Eni’s CEO, Claudio Descalzi, announced his satisfaction with the company’s success in securing three expansive exploration areas in Egypt’s recent tender for oil and gas exploration in the Mediterranean region.
The investments in these three areas form part of the $7.7 billion revealed during a meeting last month with Egyptian President Abdel Fattah el-Sisi. The funds aim to enhance the company’s successful projects in Egypt over the next four years. Descalzi noted that Eni is currently seeking new gas discoveries and will exert all efforts in exploration and production in the three areas.
Egypt plays a crucial role in the company’s investments and is necessary for Europe, considering it has about 18 billion cubic metres of liquefied natural gas. The Italian company was the largest winner in an Egyptian auction for oil and gas exploration rights, securing concessions for two of the four blocks outright. The company also won a third block in partnership with BP and Qatar Energy in the Mediterranean Sea.
The Russian company Zarubezhneft was awarded a block in the Nile Delta, marking a rare expansion abroad by a Russian company since Moscow’s full-scale invasion of Ukraine in February 2022. Zarubezhneft already operates in seven countries, including Egypt, where it is a party to production sharing agreements at offshore blocks.
Egypt, which faces growing demand for gas from its population of 105 million, has been trying to position itself as a regional energy hub. The country sells its own gas and re-exports Israeli gas as liquefied natural gas (LNG) to the Middle East, Africa, and Europe. However, the country faced some power cuts in the summer, and its natural gas production has fallen to a three-year low.
In July, the government initiated a $1.8 billion programme to commence drilling natural gas exploration wells in the Mediterranean Sea and Nile Delta. With its recent investments, Eni aims to make new discoveries in natural gas and will put the most emphasis on exploring and producing within the three designated areas. This effort will assist Egypt in fulfilling its natural gas requirements and in providing liquefied natural gas (LNG) to Europe.
