Tharwa: A Real Egyptian Fortune

Being characterized as the first Egyptian company to carry out upstream activities in the Egyptian market as well as offering petroleum services, Tharwa has kept its outstanding record of achievements since its inauguration in 2004. With the target of competing in the international arena, Tharwa shares its 2007 future plans with Egypt Oil and Gas Newspaper and shed light on its story of success

Could you briefly describe the activities of your company to our readers?
Tharwa was established as a joint stock company on February 2004, it is the first Egyptian Petroleum Company to excite upstream operations with two main goals;      E & P and Petroleum Services. The company’s mission is to explore, develop and produce oil and gas domestically within Egypt, regionally and all over the international arena. The company was established at an appropriate time when oil prices were hitting great hikes and Egypt was seeking to increase its oil revenues. Tharwa’s establishment falls within the framework of a comprehensive ministry program to raise revenues from foreign currencies.

What were your major achievements for the fiscal year 2006 and what are your upcoming plans for the future?
Tharwa had many achievements during 2006, which can be summarized as follows:
First, Tharwa achieved its first discovery “Thekah North-1” at the   Mediterranean Sea. An integrated development plan has been approved and within 18 months we will start production from Thekah. The plan puts into consideration the use of the available nearby infrastructure and facilities to reduce both cost and time.
Tharwa applied for all E & P bid rounds inside Egypt which were offered through the Egyptian General Petroleum Corporation (EGPC) and Egyptian Natural Gas Holding Company (EGAS). As a result Tharwa won and was awarded block-4 “North El Arish Offshore Concession” in the eastern side of Thekah Concession at the   Mediterranean Sea. Moreover, in Petroleum Services and for the first time in the Middle East and North Africa’s history, an Egyptian consortium constituting of Tharwa, Enppi and Petrojet have signed an agreement with the Chinese HH Company to establish a company for manufacturing onshore drilling rigs to meet the demand of expanding exploration activities in Egypt. The agreement is based on manufacturing three rigs in 2007. The plan increases production in 2008 to seven rigs, reaching 20 rigs by 2010. In addition, Tharwa has signed an agreement with an Italian Company, Breda Energia S.P.A., to establish “Tharwa – Breda Petroleum Services Company” for selling, maintaining, manufacturing Oil and Gas Well Heads, Valves and Control panels.
Also, through an alliance with Schlumberger, which provides integrated services not only to the New Comers, which do not have resources locally to execute their work plans and commitment in Exploration activities in Egypt, but also to those companies having aggressive plans.
Also, Tharwa has achieved a sizeable profit for the second fiscal year.
Concerning, our upcoming future plans; we have dedicated the year 2007 as the year of the first production from our Western Desert Concessions and 2008 as the year of our first production from Mediterranean Sea Concession “Thekah”.
Our concern, as well, is competing in the international arena. We already take the step to mark out all the bid rounds in Africa and Asia, and have evaluated our chances in order to be ready in the appropriate time.

What is the progress you have achieved in Tharwa concessions?
Tharwa has been awarded five exploration blocks, and won one block through bid rounds. Four concessions are in the Western Desert and two in the Mediterranean Sea. In the Western Desert Blocks, Tharwa defined the location of the first well. Associated work in the plan, including service company contracts and preparing the required material for drilling are in progress.  As you know, defining location for an oil well is not an easy task. A lot of work and preparation such as mine clearance, seismic acquisition, processing, interpretation and building a geological model are part of the process. The amount of spent money, which nearly doubles the financial commitment, reflects the amount of achieved work in a short time.
In the Mediterranean area, preparation and studies to lay down 50 Km pipe line and construct a platform are in progress. Expenses in 2006 more than double the financial commitments in four years.

Are you within the budget for these two projects or not?
Yes, we are. Budgets are always a reflection of the real work.

Can you tell us about Tharwa’s activities outside Egypt?
As I mentioned, competing in the international arena is one of our main objectives. Our technical team is already evaluating some possible chances in Angola and Thailand. As you know, the process is quite long and not easy. Studies on technical aspects, economics, feasibility and legislation should be prearranged carefully.

Can you explain to our readers the difference between Tharwa & Sino Tharwa?
Sino Tharwa is a service company and it was formulated with a reputable Chinese partner SINOPEC, which is one of the leading Chinese companies in the field of drilling. Sino – Tharwa is a Limited Liability Company between Tharwa and SINOPEC based in Egypt for handling drilling operations in Egypt. The new company will contribute value to the drilling activities in Egypt.

Sino Tharwa has four rigs to date, are you planning on getting more rigs soon?
Sino Tharwa was established in 2005 and started its activities with two rigs and is already contracted to purchase three more rigs. The plan is to increase the number of drilling rigs by 2007 to seven rigs which represents 350% growth in number of rigs in two years time. Growing will continue to meet the expansion in exploration and development activities in Egypt.

How do you see the future of the Egyptian oil and gas industry?
I think that during the past few years, the Oil Ministry succeeded in achieving its strategies in adding oil and gas reserves by intensive exploration and development activities and by encouraging investment in unconventional approaches to develop oil and gas fields and exploration in ultra-deep water. Beside the increase in investment for oil and gas exploration and development, the significant efforts in the LNG field led Egypt to play a major role, and in establishing a robust petrochemical industry in Egypt and world wide. All these factors positioned Egypt as a leading country in the region in attracting foreign direct investment in oil and gas, in spite of intense competition.


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