Foreign investments in Egypt’s public oil sector reach $2.2bn

Jeddah - Yasmine El Tohamy - CAIRO: A government source has estimated that the total expected foreign investment in Egypt’s oil and natural gas sector during the current fiscal year at $2.21 billion, 57.6 percent of the total $3.84 billion expected investment in the sector.

The structure of oil and natural gas investments during the current fiscal year is 57.6 percent for the private sector, 38.4 percent for public companies, 0.3 percent for government agencies and bodies, and 3.7 percent for central projects.

The source said that the Ministry of Petroleum and Mineral Resources aimed to develop gas fields and complete the Baltim South West offshore project, the Kattameya field project and the third phase of the Kamose-North Sinai project.

The ministry is also targeting oilfield development projects, including the completion of a field, implemented by Petrozenima Company, as well as the construction of the seventh storage warehouse in the Western Desert, implemented by Depco Company. The Alhamd plant project in the Eastern Desert is also being developed.

Egypt’s Minister of Planning and Economic Development Hala Al-Saeed said that the investments directed to the development of the oil and natural gas sector and mineral wealth in the country reached about EGP60.6 billion ($3.9 billion) during the current fiscal year, around 8.2 percent of the total investment.

She added that follow-up reports on economic performance indicated that the petroleum sector had made tangible achievements in the past few years in terms of research and extraction, production or export.

There was a boom in the discovery of natural gas fields, especially the Zohr field in the eastern Mediterranean region, which achieved Egypt’s self-sufficiency of natural gas and was preparing it to become a regional center for energy trading.

Al-Saeed set out the factors contributing to the increase in extraction activity, including the border demarcation agreements signed with Cyprus and Greece that paved the way for the continuation of exploration, the discovery of new fields, and Egypt’s acceleration in paying foreign companies, which had a significant and positive impact on these companies continuing their research, exploration and exploitation of crude oil and gas fields.

These discoveries resulted in the signing of agreements and oil and gas development contracts.

The Ministry of Petroleum aims to produce about 34.65 million tons of crude oil, condensates and butane, an increase of 11 percent over what was expected during the last fiscal year.

According to the ministry's plan, it aims to refine 31 million tons a year of crude oil and condensates in public sector refineries and Midor refinery, and produce about 36.2 million tons a year of petroleum and petrochemical products and propane from public sector companies and investment companies.

Egypt has begun exporting shipments of liquefied gas to global markets, in addition to supplying Jordan.

The increase in domestic production of petroleum products resulted from the exploitation of refining capacities in Egyptian factories and the import of crude oil instead of derivatives and refining it in the factories, which saved the state treasury millions of dollars.

The aim is to achieve self-sufficiency in fuel and petroleum products, coinciding with the completion and operation of all new expansion in Egyptian refineries during the year 2022/2023.

Egypt has about eight crude oil refineries with a production capacity of 38 million tons, of which only about 25 million tons are used annually.

The Egyptian Natural Gas Holding Company aims to add about 3.2 billion cubic feet of gas per day to local production by mid-2022. It will contribute to compensating for the natural decline rates in the production of wells and increasing the total production.