Egypt has announced a massive oil discovery in the Gulf of Suez, signaling a positive development in the country’s efforts to boost its energy production.
The discovery was made by the oil and gas company Cheiron, through its exploration well GNN-11, which currently produces over 2,500 barrels of oil per day.
Cheiron revealed that the total oil production from the Geisum and Tawila West Concession, where the discovery was made, has now reached 23,000 barrels per day. This is a significant increase from the previous production of 4,000 barrels per day before the GNN field was developed.
The company, which holds a 60% working interest in the concession, with the remaining 40% stake held by the Kuwait Foreign Petroleum Exploration Company (Kufpec), expressed its confidence in the potential for further exploration in the area. Cheiron and Kufpec are planning to drill at least three additional exploration wells in the concession area.
This recent discovery, known as the new Nubia discovery, underscores the exploration potential in the northern part of the concession. It also highlights the fact that the Gulf of Suez, despite being a relatively mature hydrocarbon province, still holds significant untapped resources.
The news comes at a time when Egypt is keen on increasing its natural gas production to meet the rising domestic demand and cater to the needs of export to Europe.
In 2022, the value of Egypt’s natural gas exports reached $8.4 billion, marking a remarkable 171% increase compared to the previous year. This surge in demand for natural gas in Europe, caused by the energy crisis, has provided Egypt with an opportunity to strengthen its position as an important energy supplier.
In December, Egypt made a significant discovery in its energy sector. A large gasfield was found off the country’s north-eastern Mediterranean coastline, with potential reserves of 3.5 trillion cubic feet of gas.
The gasfield, located in Nargis, is part of four offshore exploration blocks in which US oil company Chevron holds operating interests along with Egypt’s Tharwa Petroleum. This partnership between international and local companies is essential for the development and success of the gasfield.
Egypt’s petroleum and mineral resources minister, Tarek El Molla, announced that the country’s energy sector expects to attract $8 billion in foreign investment in the coming fiscal year.
These investments will be allocated to developmental and operational activities in the oil and gas sector. This will not only enhance Egypt’s energy infrastructure but also create new job opportunities and boost economic growth.
To tap into the potential of this gasfield, Egypt has planned offshore exploration projects worth $1.8 billion. These projects aim to drill new gas wells in the Mediterranean Sea and the Nile Delta. Through these initiatives, Egypt seeks to further strengthen its position in the global energy market and meet the rising demand for natural gas.
The global liquefied natural gas (LNG) trade reached a record-high of $450 billion in 2022, primarily driven by the surge in European demand. However, the supply of LNG only grew by 5.5 percent last year. Factors such as maintenance at export terminals and shutdowns at major export centers, like the Freeport LNG plant in Texas, contributed to the limited growth in supply.
Egypt’s gasfield discovery comes at a crucial time when the demand for LNG is increasing, and the supply is struggling to keep up and it provides Egypt with an opportunity to become a key player in the LNG market with its vast reserves, the country can contribute significantly to global energy security and stability.
