RESEARCH & ANALYSIS
OIL & GAS INTERNATIONAL BID ROUNDS: BETWEEN SUCCESSES AND POTENTIALS BY: AMINA HUSSEIN, REHAM GAMAL, AND TASNEEM MADI
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idding processes play a vital role in flourishing the exploration activities and creating an attractive investment climate for Egypt's hydrocarbon industry, which leads to promoting the Egyptian petroleum agreements.
Currently, more than 60 international oil companies (IOCs) are engaged in Exploration and Production (E&P) activities in 183 areas in Egypt. The areas are offered by and under the supervision of the affiliated authorities to the Ministry of Petroleum and Mineral Resources (MoP) represented in the Egyptain General Petroleum Corporation (EGPC), the Egyptian Natural Gas Holding Company (EGAS) and Ganoub El Wadi Petroleum Holding Co. (Ganope), explained in the MoP's website.
2. SIGNED AGREEMENTS & DEVELOPMENT LEASES DURING FY 2019/20
With offering more bid rounds and boosting the exploration activities, the total number of discoveries were recorded to be 78 during fiscal year (FY) 2019/20, as stated by the MoP. Consequently, Egypt's total proven reserves of crude oil and natural gas jumped to 3.1 billion barrels and 75.5 trillion cubic feet (tcf), respectively, at the end of H1 2019/20, according to the statistical review of BP Global Energy 2020.
EGAS had a large share of 30% of the total signed agreements in FY 2019/20. In addition, the gas price was amended in two agreements. During the same year, the Egyptian House of Representatives approved nine agreements signed by EGAS with a total signature bonus of $24 million, total investments of $981 million, and drilling commitments of 18 wells, according to EGAS Annual Report 2019/20.
1. INTERNATIONAL BID ROUNDS OVERVIEW OVER FYS (2015/16-2019/20) In line with elevating exploration activities and opening up several investment scopes, the MoP successfully launched five international bid rounds over the past five FYs. The supervised authorities, Ganope, EGAS and EGPC offered a total of 80 blocks; 31 of which were awarded with minimum investments of about $1.9 billion and total drilled wells of 126, according to the MoP.
10 | EGYPT OIL & GAS NEWSPAPER
The total signed agreements in FY 2019/20 were greater than the previous FY by nine agreements, in addition to five amendments, according to the MoP data.
Furthermore, development leases signed by EGAS represented 13.3% of the total signed development leases in FY 2019/20, with a total signature bonus of $300,000. The leases were signed with SDX Energy and Dana Gas, according to EGAS Annual Report 2019/20.
The signed agreements opened the doors for the entry of new international players to the upstream activities in Egypt like ExxonMobil, which won an exploration area for the first time in its history in Egypt.