The wheel for exploring new areas to boost the oil production in Egypt has been searching in every corner. Lately, the North Coast Area, used to be known as a magnificent touristic spot, has attracted the focus as a new virgin area for oil and gas E&P
In his recent visit to the sites of oil fields situated in the Western Desert, President Hosni Mubarak asked the Minister of Petroleum Eng. Sameh Fahmy about the possibility of having oil and gas locations in the Mediterranean region, especially in the northern coast. Despite the Minister’s clarification that no attention has been given to this area in order to avoid any negative effect on tourism, the President commented directly, “if the oil would have higher yields and greater income than tourism, then it is time to prioritize oil over tourism”.
Certainly, with the increased oil and gas discoveries in the Mediterranean Sea area, the possibility of having the North Coast beaches in international bid rounds to discover oil and gas is linked to many conditions and vital considerations. Firstly, evaluating the volume of oil or gas reserves to guarantee that the discovery brings commercial production. Secondly, in case of achieving the first condition, the international oil operating companies should work within the obligations of taking into consideration the preservation and protection of the environment as it is happening now in the Red Sea, especially near the touristic villages and resorts.
Today, one of the hot spots of the national tourism in Egypt is the North Coast, specifically the area between Alexandria and Marsa Matrouh. Egypt’s Mediterranean Coast is regarded as the 500-kilometer shoreline spanning from the resort town of Agami just West of Alexandria, until the remote village of Marsa Matrouh approaching the Libyan border.
In sum, although petroleum, remittances, the Suez Canal and tourism were crucial resources to Egypt’s economy and balance of payments, their long-term potential was limited. Oil prices fluctuated, and Egypt could deplete its exportable oil within the coming twenty to thirty years, if there are no new discoveries.
As for tourism, Egypt’s tourism industry, the country’s top hard currency earner, has started to feel the pinch of the global financial crisis, with hotel bookings down 30 percent in January 2009 compared to the same month in 2008. However, the Egyptian central bank said in December 2008 that revenue from tourism in the first quarter of the 2008/09 fiscal year, which started in July, rose 15.2 percent to some $3.3 billion.
On the other hand, the surplus of the domestic oil sector in 2008-2009 is 33 billion dollars and represents 66 percent of the total surplus of the government economic bodies by giving no priority for one side over the other.