The Petroleum Masters Championship

The ongoing hunting race for oil production is never limited; the E&P wheel never stops and each operator is not only seeking the economic profit it can add to his treasury, but also he is competing for taking the lead as the top achiever of the year

Total production in Egypt 2008
Throughout the year of 2008, the Ministry of Petroleum worked hardly to execute its production plan for the year.  As a matter of fact, the petroleum sector is frequently under the spot as the Egyptian society commonly portrays this sector as the magic lamp of the country’s wealth. Though the ministry has not fully attained the planned production rate, it succeeded to boost its production compared to 2007.
Last year, the total oil production averaged 197 million barrels, representing 89 percent of the planned amount, which counted for nearly 221 million barrels. As for the condensates, a 96.67 percent of the plan was fulfilled; a total of nearly 43 million barrels of condensate were generated, which is two million barrels lower than intended.
Compared to 2007, the oil production has noticeably increased from 183 million to 197 million barrels of oil, while the production of condensates has slightly decreased by approximately one million barrels; from 44 to 43 million barrels of condensates.

Top Operators 2008
Compared to last year’s list of top producing operators, the first three places have not changed and been crowned to the same three companies of 2007, which are Petrobel, GUPCO and Khalda respectively.
Starting with the top achiever of 2008, Belayim Petroleum Company (Petrobel) scored the highest record of produced crude oil in Egypt. The company’s planned production was in the average of 50 million barrels by the end of 2008, however, its actual production was approximately five billion barrels less than intended. Yet, Petrobel has succeeded to maintain its first position for a second consecutive year.
Petrobel’s operations cover two main areas in the country, the Gulf of Suez and Sinai. In the first location, the company holds operations in the Offshore Balayim and Sinai fields, while in the second location; it holds interest shares in Onshore Balayim. In both areas, Petrobel was on the verge to meet the planned production volume for 2008. In the Gulf of Suez, the company production level was approximately 17 million, which is 86.2 percent of planned production. As for Sinai, it exceeded the 28 million barrels, which represents 94 percent of the plan. Petrobel’s total production was four million barrels lower than planned for the two areas collectively.
These production figures show clearly the rate of implementing Petrobel’s plan during 2008, is 90.99 percent only.
Petrobel is a 50-50 JV of the Egyptian General Petroleum Corporation (EGPC) and the Italian ENI. The company was established in 1978 in accordance with the investment law No. 16.

Moving to the first runner-up, GUPCO oil production has positioned the company in the second place in the top achievers race for 2008. The company’s production volume has been categorized in the 30-billion barrels class; it produced over 35 million barrels over the last year. This figure was not too far from the planned production figure, which counted for more than 40 million barrels. These numbers show that GUPCO has fulfilled 90,75 percent of its 2008 production plan.
GUPCO is recognized for its wide operations covering two main areas in the country, the Gulf of Suez and Western Desert. In the first area, the company operates in 37 fields. Out of these fields, the company was expected to produce more than 38 billion barrels, however its actual production volume was approximately 33 million barrels, which is five million barrels lower. The GUPCO fulfilled only 87.09 percent of its plan for the Gulf of Suez.
However, in the other area of operations, GUPCO hit exceptional records as it exceeded the planned production volume by more than 10 million barrels. Out of its nine fields in the Western Desert, the company was expected to generate nearly 43 million barrels, however, it produced more than 53 million barrels, scoring a 123.52 percent achievement rate in the area.
GUPCO, a 50-50 JV between EGPC and BP Amoco with the latter being the operator, is one of Egypt’s biggest oil producers.
This company used to be in the lead since its establishment, however, the production slip has taken off its title as the top operator. despite its considerable producton volume, analysts are still wondering if it will be able to re-gain its position once again. In all scenarios, we should not underestimate GUPCO’s capabilities to be the first once again one day. Based on 2008 achievements, we owe GUPCO a silver medal.
In recognition of the volume of production it generated into the petroleum sector, the bronze medal goes to Khalda Petroleum Company (KPC), which has deserved the second runner-up place for the second consecutive year. The company has a total production of 22 million barrels and succeeded to fulfill 91.48 percent of its 2008 production plan. Khalda operates solely in the Western Desert, where it has possessions of operation licenses in five concessions, which incorporate 30 fields. The company was expected to produce nearly 24 million barrels out of these fields.
It is worth mentioning that Khalda planned to produce approximately 24 million barrels in 2008 and it was noticeably close to achieve its target.
KPC is a JV held 50% by the EGPC, and 50% by Apache (operator which in early 2001 bought most of Repsol’s Egypt interests).

Reaching the third runner-up, Agiba Petroleum Company reserved the fourth place with more than 17-million barrels production, achieved throughout last year. The company’s areas of interests are located in the Gulf of Suez and Western Desert. The rate of plan execution in the latter location was higher than the first one; Agiba attained 92.56 percent in the Western Desert, which is superior compared to the 70.28 percent in the Gulf of Suez.
In the Western Desert, the company holds 18 fields, distributed in two concessions. Agiba was only one million barrels behind its plan for the area; it generated around 15 million barrels. While in the Gulf of Suez, the gap was larger; approximately 23 million barrels were produced, whereas the planned volume averaged 32 million barrels. The total achievement rate of Agiba during 2008 counted for 88.9 percent.
Agiba was founded in 1981, as an Operating Company for the EGPC, IEOC, IFC and LUKAGIP. Over more than 25 years, Agiba established its reputation as a Joint Venture Operating Company for exploring, drilling and producing hydrocarbons in Egypt. The company started its permanent hydrocarbon production on October 1986.

Despite having the privilege of operating in three areas, the General Petroleum Company (GPC) could not move ahead in the list and remained in the fifth place. The company’s total production was stayed in the 15-million barrels category, although the plan revolved around producing more than 17 million barrels by the end of 2008. The GPC implemented 86.63 percent of its production objective for the year.
The GPC, operating arm of EGPC, was established in 1956 by the state to take over from then sole concessionaire, Anglo-Egyptian (Shell/BP), whose onshore fields and other assets were nationalized in 1964. GPC’s fields are all onshore on the west coast of the GOS and some are deep within the Eastern Desert. Nearly all were discovered by Anglo-Egyptian. Currently, the company holds 18 fields, distributed in the three areas.
Based on the GPC’s production records, its three areas of operations are respectively Sinai, the Eastern Desert and Western Desert. In the first area, the GPC, holding interests in three fields, moved beyond all expectations and hit a record of five million barrels of oil, which signifies a 117,14-percent achievement rate in this area. Moving to the Eastern Desert, the company achieved 88.59 percent of its target; it produced 14 million barrels of oil, while the planned was nearly 16 million barrels.
Although the company did not reach its target, yet its accomplishments in this area sounds much better compared to the Western Desert, where the company could not execute half its plan. The one-field area did not give off more than three million barrels of oil, while the target revolved around nine million barrels, which reflect 40.18 percent of the plan. though the reason behind this unpleasant outcome is not announced by the company, GPC should consider solving this shortage during 2009.

Despite the short gaps between one operator to another in terms of production volumes, each barrel generated can be an indispensable factor in classifying and determining each operator’s position in the top achievers race for 2008. With nearly two million barrels difference, Qarun Petroleum Company (QPC) came sixth following the GPC. The company ended last year with an amount exceeding the 13 million barrels of oil.
Qarun enjoyed an outstanding workflow in the area of Western Desert, where 92.24 percent of its target was achieved through the production of 13 million barrels (one million lower than planned), out of 17 fields.
On the other hand, a noticeable fall took place in Sinai, where Qarun failed to meet the planned production volume (1.8 million barrels) and brought out only 11.2 thousand barrels, which conveyed 6.14 percent of the company’s plan.
Qarun was established on August 13th, 1995, as an operating company for EGPC and the group consisting of Phoenix Resources Company of Qarun, Apache Oil Egypt Inc, and GNR Seagull at Qarun area of the Western Desert covered by the concession agreement between the Egyptian government (represented by EGPC) and the said group. Effective May 1996, Phoenix and Apache merged in Apache Egypt Inc., and by December 19th, Apache Egypt Inc. assigned and transferred all its assets to Apache Qarun Corporation I. D.C.

Remaining in the class of million-barrels production, Petro Alam comes last in this class, occupying the seventh place in the race. The company produced a total of 10 million barrels of oil, achieving a 105.79 percent of its 2008 plan. The company operates solely in the Western Desert, in five fields. Petro Alam has witnessed a production booming throughout 2008, compared to 2007, in which it generated virtually 20 thousand barrels of oil only.

Heading to the last three places, the Suez Petroleum Co. and Deminex West Gulf Co. (SUCO/DEOCO) reserved the eighth position with six million barrels of oil. This reflects a 90 percent of the planned production, which averaged seven million barrels. The company has also a sole area of operations, which is the Gulf of Suez.
Suco is a JV of EGPC (50%), Deminex (25%) and Repsol (25%), while DEOCO is the operator of the Gulf of Suez leases.
The remaining two positions go to Bar El din Petroleum Company (Bapetco) and Ganoub Eldabaa’ respectively. Both companies operate solely in the Western Desert. Bapetco, in the ninth position, has outstandingly surpassed its targeted production and achieved a five million-barrels of oil, recording a 108.35 percent. Whereas, Ganoub Eldabaa’ scored 63.91 percent of its plan and generated four million barrels of oil, which is two million barrels approximately less than the planned six million barrels.
Badr Petroleum Company is one of the EGPC affiliated companies jointly owned by Shell Egypt N.V. Bapetco was established in 1983 following the discovery of gas in the Western Desert, around 130 kilometers southwest of Alexandria. The company is a 50-50 joint venture between Shell and EGPC.

Leading Operators per Area
As known, Egypt operations’ area is divided into the Gulf of Suez, Western Desert, Eastern Desert, Sinai, Delta and most recently Upper Egypt. Through this per area classification, an analysis of the top five operators in each area will be displayed.
In the Gulf of Suez, GUPCO is crowned as the top operator of the area with more than 33 million barrels of oil, followed by Petrobel (> 17 million barrels), SUCO/DEOCO (> six million barrels), Petro Gulf and Gempetco (each with an average of three million barrels).
In the Western Desert, Khalda comes at the lead, recording more than 22 million barrels of oil, followed by Agiba (> 15 million barrels), Qaron (> 13 million barrels), Petro Alam (> 10 million barrels) and finally GUPCO (> five million barrels).
In the Eastern Desert, the first place goes to the GPC, which produced almost 14 million barrels of oil, forming a huge gap of 11 million barrels between the first position and Eshpetco in the second position, the latter company produced about 3 million barrels, followed by Petro Dara and Abidico (each produced an average of one million barrels) and Megapetco (476 thousand barrels).
The remaining three areas, Sinai, Delta and Upper Egypt include usually a limited number of operators. In Sinai, there are only three operators, which are by order, Petrobel (> 28 million barrels), GPC (> 528 thousand barrels) and Qarun (> 11 thousand barrels). In Delta, Al-Mansoura is the only operator in the area. It recorded a total production of three million barrels of oil.
As mentioned earlier, the most recent area put on the development plan set by the Egyptian Ministry of Petroleum is Upper Egypt. Al-Baraka field generated last year close to 44 thousand barrels of oil. Back to September 2007, Dana Gas announced the discovery of oil in commercial volumes, Al-Baraka field, situated in the Komombo Concession. Southern Egypt. This “historic discovery” is the first of its kind in the area and has opened the door for new E&P operations in the country. This extraordinary finding has open new horizons for Upper Egypt and has attracted since then the Ministry of Petroleum’s attention, which set special programs in accordance with Dana Gas to further develop the concession.

By Yomna Bassiouni


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