Global energy giants are keeping a close eye on Egypt. While Egypt may not be an apparent location for investment due to political instability and security concerns given its location, recent developments have opened a window of opportunity for gas companies, ENI and BP.
BP has a long history in Egypt and has been helping the country meet its energy needs for more than half a century, investing over $30 billion during that period. They also claim that with its partners, BP provides almost 10% of the country’s oil production and 40% of its gas and noted record investment in major projects in the Nile Delta set to significantly boost the supply of much-needed domestic energy.
Egypt has had significant gas discoveries. ENI, an Italian company, discovered the largest gas field in the Mediterranean in 2015 at the Zohr field in Egypt. Since then, Eni, as well as BP, are betting big on Egyptian gas exploration and production, and will be making Egypt their top investment destination in the coming years, pouring billions of dollars into their projects there.
For BP in Egypt, the West Nile Delta project represents another major milestone in its long history here. “It is exciting because we’re turning a new page that will be all about gas. And every molecule we produce domestically – at half the cost of imports – is crucial to help rebuild the nation’s economy,” says Hesham Mekawi, BP's Regional President for North Africa.
The $12 billion investment to develop discoveries in the West Nile Delta will provide around 1.2 billion cubic feet a day of gas for Egypt’s national grid. First gas is due this year from two of the five fields in the development, located about 85 kilometres offshore from Alexandria, the country’s second largest city.
Phase one of the West Nile Delta (WND) project is set to be operational a little more than two years since agreements were signed, with two fields – Taurus and Libra – being ‘fast-tracked’ to reach production in 2017. The key to expediting this section of the project is making the most of existing infrastructure. The three other fields – Giza, Fayoum and Raven – are being developed at the same time, involving dedicated, longer-distance tie-backs to the shore.
But this is not the only area where BP has been successfully investing. BP’s website highlights major projects to come on stream in 2017. The projects identified are the West Nile (Egypt), Khazzan (Oman), Juniper (Trinidad), Thunderhorse Expansion (USA), Trinidad Onshore Compression (Trinidad), Persephone (Australia).
When it comes to future investments in Trinidad, there is a question mark about the government’s ability to conclude negotiations, especially with BP. Speaking at the Trinidad and Tobago Energy Conference, Bernard Looney, BP’s Chief Executive, Upstream said, “I had hoped today that we could be announcing the sanction of Angelin – setting a course for first gas in 2019. We are not quite there yet but making good, steady progress. I’m hopeful that we can conclude negotiations as quickly as possible to establish a platform of stability that will allow us to move forward. One that works for all sides of the partnership.”