Egypt is in a race against time to enhance the quantity and quality of its national hydrocarbon production to a level that realizes its ambitions to become a self-sufficient, leading energy trading hub and fortify global energy security with Cairo being a main supplier to neighboring energy markets. Having the advantages of proximity, know-how, and the effective leadership of Egyptian Minister of Petroleum and Mineral Resources Karim Badawi, Egypt has yet to explore a new frontier that has the potential to boost national production to a whole new level. For many years, the Sinai and Red Sea have been two regions that have been left untouched but with recent discoveries, they could be the targets for further exploration and production for the years to come. With their abundant hydrocarbon resources, these two regions have the potential to give the local industry the much-needed boost that will catalyze its growth even further.
Sinai and the Red Sea (the Gulf of Suez in particular) have had significant historical impact starting with Egypt’s first crude oil discovery in Gemsa field located in the Gulf of Suez, founded in 1869 and began producing in 1910. In addition, one of the most important fields, Ras Shukheir, is run by the Gulf of Suez Petroleum Company (GUPCO) and functions as an offshore oil-loading tanker terminal. Also, Egypt’s fourth-largest oil field is the Ramadan field also located in the Gulf of Suez, and accounts for a significantly large portion of Egypt’s oil production.
It should also be noted that together with the El-Morgan and Ramadan oil fields, the July oil field is Egypt’s fifth largest and accounts for about 39% of the nation’s total oil reserves. The West Amer (EGY-GOS-14) Block is situated in the Gulf of Suez offshore and the Eastern Desert onshore. The area is 907.9 square kilometers (km²).
Onshore on Egypt’s Sinai Peninsula, several assets play a significant role in the local industry. It is home to the East Lagia concession. It is owned and run by Vegas with a 100% working interest and spans 2,989 km² of land. In addition, the South Lagia (EGY-GOS-13) Block is situated offshore in the northeastern Gulf of Suez and onshore in Sinai. The total area is 954.7 km². The East Badri (EGY-GOS-15) Block is located offshore in the southeast Gulf of Suez and onshore in Sinai with a total area of 552.4 km².
Together, the Gulf of Suez and Sinai carry significant weight in Egypt’s energy industry, but there is yet more to be done with enhancements and measures to optimize the efficiency of the fields within these two regions. It is worth noting that in fiscal year (FY) 2023–2024, the two regions accounted for around 38% of Egypt’s total crude oil output, making them major contributors to the country’s oil production. The petroleum sector in Egypt still relies heavily on these areas.
Initiatives are being taken to explore the Red Sea beyond the Gulf of Suez with advanced seismic survey research. One of the companies involved in the efforts is TGS. This leading global energy data firm said: “The Red Sea remains underexplored but is one of the world’s biggest spotlight areas for hydrocarbon exploration after the Arabian Gulf. The densely explored Gulf of Suez and natural oil seeps around the Red Sea show that a working petroleum system is in place in the northern Red Sea and some of the southern provinces. Egypt is now exploring beyond the Gulf of Suez after the bilateral maritime demarcation with Saudi Arabia has been signed. The Red Sea, a frontier basin, contains an estimated mean volume of 5 Bbbls of undiscovered but recoverable oil and 112 tcf of natural gas (Schenk et al., USGS 2010). Since 1976, more than 28,000 km of 2D and about 4,000 km2 of 3D seismic data have been acquired, along with 12 exploration wells drilled through several concessions.”
As far as the Sinai is concerned, there is still a lot to be uncovered. Recent research by Mohammad Abdelfattah Sarhan from the Geology Department in Damietta University’s Faculty of Science indicated the potential of natural gas reserves in the offshore North Sinai Concession in his paper titled “New prospective gas plays in pliocene sands, offshore Nile Delta Basin: A case study from Kamose-1 well at North Sinai Concession, Egypt”. Yet, there is even more ground that needs to be covered.
Tapping into the Rea Sea and Sinai more extensively offers the petroleum sector in Egypt unlimited opportunities which could open the doors for investment which could thereby fund additional upstream operations to stimulate the national economy. Recent developments and improvements in the investment climate have further enhanced interest in the Red Sea and Sina as areas where more drilling and exploration can be conducted in the years to come.
