"The government aims a stimulating BP into more drilling and exploration activities", Dr. Ramadan Abul Ella, Head of Petroleum Department at Suez Canal University told Al Youm Al Sabea newspaper, commenting on the Ministry’s new agreement with BP.
The Petroleum Ministry announced recently that it has made some changes to the old agreement with BP, which included working with the Production Share System, to start operating with the "Post-Investment" system.
Abul Ella said that this is the government’s strategy to meet the domestic growing need for gas, especially that BP operates in the deep water, known by its high exploration cost, and such amends would motivate BP to invest more in the area.
He also added that "Post-Investment" system allows the foreign companies to explore for gas then sell the full production to the government, and that would stimulate other firms into the country. Besides, he pointed out the fact that Egypt is dealing with lots of countries with the Production Share system, as with Norway.
Abul Ella expected that other countries would go into discussions with the ministry to have the same adjustments in the agreements as BP.
It is worth mentioning that BP persuaded the government into agreeing to make amends to the contract of its acquisition area in the Mediterranean Sea, which allowed BP to get the entire production of the north fields throughout the 20 years period of exploration and investment.