Egypt signed a concession agreement for the exploration and production of oil and gas in the Mesaha area of Upper Egypt last week.
Minister of Petroleum Sameh Fahmy witnessed the signing of the agreement between consortium members Melrose Resources of the UK, Hellenic Petroleum of Greece and Oil Search of Australia, the State Authority of Ganoub El-Wadi Holding Petroleum Co. (Ganope) and the Ministry of Petroleum.
The concession area, which covers an unexplored sedimentary basin, is surrounded by the Sudanese border in Upper Egypt and covers an area of 57,000 km². The initial exploration period is four years and can be extended to a maximum of nine years. The gross financial commitment is $34.3 million, drilling four wells and a signature bonus of $2 million.
“Developing the Ganoub El-Wadi area in Upper Egypt is at the top of our priority list and we are keen on increasing international investments there,” Fahmy said during the signing.
Abiding by this strategy, the ministry has organized four international bids that resulted in 10 agreements over an area of 220,000 km², with investments of $282 million and the drilling of over 46 wells. These agreements make up 35 percent of investments in Ganoub El-Wadi.
“More international bids are being planned to increase oil and gas exploration investments in Ganoub El-Wadi, the Red Sea and Western Desert areas,” Fahmy said.
The ministry is currently encouraging foreign investors by amending the bidding and tender laws, making them more attractive for investors. It is the first time the three consortium members have invested in Egypt, which proves the ministry’s aim to attract new market players.
(Daily Star Egypt)