Bright Outlook for Egypt’s Untapped Potentials: Interview with Naftogaz Egypt Branch Director Fedir Bayuk

Bright Outlook for Egypt’s Untapped Potentials: Interview with Naftogaz Egypt Branch Director Fedir Bayuk

Exploration and Production (E&P) stage in the Oil and Gas field is a process that requires real drudgery that must be applauded especially when it is followed by lucrative results. That’s why, Egypt Oil and Gas (EOG), who is always keen to shed the light on striking examples of upstream breakthroughs, conducted this interview, with a company managed recently to reach production results too remarkable to be overlooked.

How did Naftogaz group manage to ramp up its oil production from its assets in the Western Desert of Egypt by more than 20%?

Start of 2021 hydraulic fracturing campaign at AES-E6 field has given the possibility to enhance hydrocarbons influx from carbonate and sandstone reservoirs of Abu Roash formation, thus improving performance of stimulated wells.

How does Naftogaz see the petroleum potentialities of the Western Desert and does Naftogaz have prospective plans relevant to this area?

Naftogaz considers the potentialities of the Western Desert as promising, so our asset in the Western Desert remains our main one in Egypt. Our actions, particularly developing current assets through hydraulic fracturing and water flooding, which we have already started prove this considerable potential. Moreover, Naftogaz is participating in the current bid round, which includes blocks in the Western Desert, for which we have great expectations.

What are the enablers that helped Naftogaz increase natural gas delivery from the fields in Egypt in 2020 by 40%?

When one of the oil wells was watered, it was recompleted to a gas bearing zone, where it showed the capability to produce with a rate of 9.5 MMscf/d. Also commissioning of a gas boosting compressor at HG field gave us the possibility to evacuate additional associated gas.

What does Naftogaz look forward to this year on the level of natural gas delivery from Egypt?

With the support of the EGPC, it is planned to replace low efficiency rented gas compressors with two sets purchased from one of EGPC affiliated companies, thus reaching maximum possible capacity regulated by the gas grid of Abu Sannan Area.

What are the Naftogaz results on the levels of production and investments in the first quarter of 2021?

In the first quarter of 2021, Naftogaz invested USD 7.4 million in the projects in Egypt and a total of USD 537 million since the commencing of its activities in Egypt.

At the same time, the decline in oil production was eliminated after an aggressive workover campaign for the idle wells, also the commencement of a pilot water flooding project at AES-E3 field gave promising expectations, which encourage us to develop further mentioned and other projects for secondary oil recovery.

What about the company’s main goals for the second half (of 2021)?

Naftogaz’s production target is to ramp up oil production by a further 20% through wells stimulation, then to work on tasks to reduce decline by adding new reserves.

The company’s main strategic goals are: to enhance the productivity of the deep wells via hydraulic frack stimulation technique, to develop further the started and to initiate new waterflooding projects, and to reduce renting expenditures via investing in own assets.

Where does Egypt stand in Naftogaz new corporate strategy-2025?

The main goals of Naftogaz in Egypt for the second half of 2021, as well as in our corporate strategy-2025 are, in particular, the optimization of existing assets.  Given the previously stated interest in new promising areas in Egypt, Naftogaz  is taking steps to participate in new projects to obtain the maximum positive economic effect. Thus, we are participating in the bid round, which EGPC and EGAS announced in February 2021 for 24 prospective onshore and offshore areas.  Naftogaz has already joined the EUG platform and is studying the available information on the offered areas.

What is the role Naftogaz can assume in Egypt’s mission to be a regional hub for natural gas?

Egypt and Ukraine are long-standing partners in many sectors of the economy. Naftogaz highly appreciates the reforms which the Egyptian Government currently actively implements in all areas, including the oil and gas sector. With the assistance of the EGPC and other partners, Naftogaz will work to increase gas production through our operating company. That will consequently strengthen Egypt’s role as a regional natural gas hub, strengthen its prospects as a gas supplier to European markets. As a national oil and gas company of Ukraine, which is interested in economically feasible gas imports, Naftogaz paid attention to the prospects of gas supplies from Egypt to Ukraine’s neighbors, such as Hungary and Lithuania.

What are the current steps taken by Naftogaz to achieve its goal of carbon neutrality by 2040?

In accordance with the approved Naftogaz Group corporate strategy-2025, to achieve the goal of carbon neutrality by 2040, the new “Low Carbon Businesses Platform” is being created. Our ambitious objective in the frame of corporate strategy is to invest approximately USD 1 billion in emission reductions, hydrogen and biofuel production, carbon capture, use and storage. The goal of Naftogaz to achieve carbon neutrality by 2040 is being applied in line with European Union’s net-zero 2050 strategy. Naftogaz is already developing a network of electric car charging stations under the WeEnergy brand.


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