July 24, 2017

Can Egypt’s Natural Gas Production Be Doubled by 2020?

Stratas Advisors

This excerpt is from a report that is available to subscribers of Stratas Advisors’ Global Hydrocarbon Supply and Global Upstream Project Analytics services. 

Already a subscriber?  Read the full report

.

 

Egypt is the third-largest natural gas producer in Africa and holds around 65 Tcf of proved natural gas reserves, according to the BP Statistical Review of World Energy 2017. But due to Egypt’s government paying low gas prices to foreign operators, it was getting more difficult to attract investments on developing new gas projects. Therefore, natural gas production had been under rapid decline from 5.9 Bcf/d in 2011 to 4.1 Bcf/d in 2016. 

With significant natural gas reserves in the country, Egypt still needs to import natural gas from neighboring countries to satisfy domestic consumption, so Egypt’s government has agreed to pay a higher price to the foreign operators and encourage them to develop new natural gas discoveries, especially fields in the deepwater Mediterranean Sea and Nile Delta. 

With new-source projects being brought on stream in the next couple of years, the Ministry of Petroleum in Egypt is expecting to double the country’s gas production by 2020. Will they reach this goal? Stratas Advisors put together a country production outlook to test the outcome.

New Gas Projects 

There are several major gas projects in the pipeline that will be the main drivers for production growth in the next five years.

In April 2017 the West Nile Delta Phase One project, which is operated by BP, began producing in the Taurus and Libra fields. The West Nile Delta Phase Two project, involving development of the Giza, Fayoum and Raven fields, is scheduled to come online in 2019. Total recoverable reserves of the West Nile Delta Project is about 5 Tcf.

The Zohr field, discovered by ENI in 2015, is the largest natural gas field so far discovered in the Egyptian Mediterranean Sea region. Zohr holds approximately 30 Tcf of natural gas resources. Operator ENI started Zohr’s fast track development in 2016. The development is now on track to start production by the end of 2017 and reach a plateau of 2.6 Bcf/d in 2019.

On the East Nile Delta, the Atoll field operated by BP is estimated to contain 1.5 Tcf natural gas recoverable reserves. The field was discovered by BP in 2015. The Atoll project will be developed in two phases: Atoll phase one is expected to start first production in 2018, followed by phase two, which is still in the conceptual stage and scheduled to come online in 2020 (Table 1).

Table 1 - New natural Gas Projects in Mediterranean Sea

Project

Fields

Status

First Production

Discovery

Reserves (Bcf)

Capacity (mmcf/d)

West Nile Delta Phase 1

Taurus, Libra

Producing

2017

2006

2400

700

Atoll Ph1

Atoll

EPC

2018

2015

750

500

Atoll Ph2

Atoll

Conceptual

2020

2015

750

500

Zohr

Zohr

EPC

2017

2015

30000

2700

West Nile Delta Phase 2

Giza, Fayoum and Raven

EPC

2019

2006

2600

800


Not a subscriber? Read about the Global Hydrocarbon Supply and Global Upstream Project Analytics services.