Skip to content Skip to Search
Skip navigation

BP invests $1.5bn in gas projects in Egypt

The Maersk Discoverer rig drilling for BP offshore Egypt. The company could invest up to $6.5bn in gas and oil projects in the country BP Images
The Maersk Discoverer rig drilling for BP offshore Egypt. The company could invest up to $6.5bn in gas and oil projects in the country
  • UK major adds to Egypt commitments
  • Venture with Adnoc in play this year
  • Egyptian gas production down

BP will invest $1.5 billion to develop gas projects and drilling in Egypt over the next three to four years.

It was revealed two weeks ago that the UK-based energy business and Abu Dhabi state oil company Adnoc have agreed to pursue a natural gas joint venture in Egypt. 

The venture, reported by Bloomberg on Wednesday, citing a BP spokesperson, is expected to be finalised in the second half of this year, with BP holding 51 percent and Adnoc 49 percent.

It will give Adnoc a stake in the Zohr gas field, the largest in the Mediterranean, that was discovered by Italian energy major Eni in 2015. 

BP did not respond to requests for comment.

BP CEO Murray Auchincloss last month said the company will invest up to $1.5 billion in oil exploration activities in Egypt, with potential expansion to nearly $5 billion.

Egypt is targeting a 25 percent increase in gas and oil investments for the financial year 2024-25, according to remarks made by oil minister Tarek El Molla at the Egypt Petroleum Show on 21 February. Speaking to Asharq Bloomberg, El Molla said that Egypt is hoping to attract $7.5 billion in foreign direct investments.

El Molla also told reporters that the country’s gas production has fallen to 5.5 billion cubic feet a day, citing natural declines in the gas fields and ageing wells. 

According to Bloomberg calculations, gas production is currently the lowest in years. This is down from an all-time high of 7.2 billion cubic feet a day achieved in September 2021. 

Egypt has been relying on Israeli gas imports to meet its growing domestic demand, as well as for re-exports, which have been a significant earner of scarce foreign currency.

Despite suppressed production rates, Skip York, chief energy strategist at US-based energy consultancy Turner, Mason & Company, said that investments in Egypt remain attractive.

“The rising interest in developing brownfield projects in mature basins such as Egypt is a global trend since the oil price collapse in 2014,” he said. 

Companies are focusing more on consolidating established projects in countries with established gas logistics infrastructure due to uncertainty surrounding the future of natural gas. 

“Returns across the gas portfolio could be higher with brownfield investment in Egypt rather than a similar-sized greenfield investment somewhere else,” York said.

According to an Asharq Bloomberg report on Tuesday, Exxonmobil drilled their first exploratory well in October, after the company’s concession to search for oil in the North Marakia offshore block was ratified by Parliament last year

Exxonmobil told Asharq Bloomberg it intends to drill three further exploratory wells in 2024 at an initial cost of $100 million. 

The north African country is on an energy drive and this week signed seven agreements with global companies to develop green hydrogen and renewable energy projects in the Suez Canal Economic Zone, with expected investments worth $40 billion over 10 years.

Investment of nearly $12 billion is expected for a pilot phase, followed by another $29 billion for the first phase, the government’s information department said, citing Hala El-Said, minister of planning and economic development.

Latest articles

Nature, Undersea cables account for as much as 90 percent of Europe-Asia telecommunications, Water

Iraq and Kuwait team up for European telecom corridor

Iraq’s Informatics and Telecommunication Public Company, a division of the Ministry of Communications, has signed an agreement with Kuwait’s Zajil Telecom to create a telecommunications corridor from the Gulf region to Europe, transiting through Iraq and Turkey. The new route will pass through Iraqi sea and land ports. Iraq’s minister of communications Hayam Al-Yasiri said […]

An artist's impression of part of the Diriyah Square development

Diriyah Square planned for historic Riyadh district

A public space featuring 400 retail outlets and 100 restaurants and cafes is planned for the historic Riyadh district of Diriyah. Diriyah Square will be announced next week at the World Retail Congress in Paris and aims to attract a combination of international retail brands and local artisans.  Diriyah Gate Development Authority group CEO Jerry […]

Turkish crude steel output rose 25% year on year to 3.2 million tonnes in January

Turkish steel in the black but EU rules rankle

Turkey’s steel industry has rebounded strongly from a weak 2023, despite facing new emissions standards and competition for important markets.  Crude steel output rose 25 percent year on year to 3.2 million tonnes in January, with domestic consumption of finished steel reaching 3.5 million tonnes, a 20 percent increase.  Exports were also up, increasing 23 […]

Passengers at Beijing Capital International Airport. Air China will fly from the airport to Riyadh three times a week.

Third Chinese airline to launch flights to Saudi Arabia

Air China is set to begin flights to Riyadh in May, becoming the third Chinese airline to establish a route to Saudi Arabia. It joins China Southern and Eastern Airlines in connecting China with the kingdom.  Air China’s Airbus A330-300 will serve the Beijing-Riyadh route three times a week. The expansion in capacity between the […]