Friday, July 24, 2015

Egypt signs update to head of agreement with Eni following new gas discovery

Egypt and Eni on Friday signed an update to the head of agreement reached in March, following the recent discovery of gas reserves of up to 15 billion cubic metres in Egypt's Nile Delta region.

The Italian gas company said in a press release that the update was signed by Egyptian Minister of Petroleum Sherif Ismail and the company’s CEO, Claudio Descalzi.

The release did not clarify the details of the update.

During Egypt's economic development conference in March the company signed heads of agreement with the Egyptian government worth $5 billion over a period of 4-5 years.

"The investment will lead to the realisation of projects to be implemented in the next four years and directed to the development of 200 million barrels of oil and 1.3 TCF of gas," Eni said in the release.

Eni has been operating in Egypt since 1954 with an equity production of 180,000 barrels of oil equivalent per day.

Prime Minister Ibrahim Mahlab, who attended the signing of the deal, is on a three-day visit to Italy aimed at landing energy deals and reaffirming strong bilateral.

Egypt has been experiencing an energy crunch since the summer of 2008, but the energy sector took a blow following the 2011 uprising as arrears to foreign oil firms accumulated and production slowed.

The Arab country garnered some $40 billion in energy deals during the development conference held in March as part of the government's plans to boost an economy battered by more than four years of political upheaval.

Italy is one of Egypt's largest trading partners with $6 billion worth of mutual trading value in the 2014 fiscal year, Egyptian central bank data shows.

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