Wednesday, March 18, 2009

Energy News in Egypt

The German company E.ON Ruhrgas bought 29% stake in an offshore exploration block NW Damietta, from Shell Egypt NV, which owns 61% of the shares. The remaining 10% are owned by GdF Suez.

"In association with this license, we see a significant exploration potential," said Dr. Jochen manner, a member of the Executive Board of E. ON Ruhrgas.

E.ON Ruhrgas already has its own gas production in Norway and in Britain. The expansion to North and West Africa serves the security of future gas and LNG supplies for European markets. In 2008, E.ON Ruhrgas was also awarded an exploration license in Algeria.

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A significant gas discovery has been made in the West Manzala Concession in the Nile Delta region of Egypt by Dana Gas, the Middle East's first and largest regional private-sector natural gas company.

This latest find is one of several discoveries made by the company during the last months and it plans to continue with further drilling in this concession, it also follows a dry gas discovery at the West Manzala-2 well and three gas and condensate discoveries at the El Basant-1, El-Basant-2 and Salma-1 wells. Since 2008, the new discovery, named West Manzala-2 (Haggag prospect), has encountered approximately 20 billion cubic feet (bcf) of dry gas. The new well is located a few hundred meters away from the gas sales pipeline leading from the company’s South Manzala gas processing facility. 

The Azhar-1 well find comes barely a week after the Mideast's first and largest private sector Gas Company discovered roughly 20 billion cubic feet of dry gas in another concession in the Delta region. 

Azhar-1 is the latest in a string of discoveries resulting from Dana Gas' aggressive drilling campaign in Egypt, which began in 2008 and continues to yield results in 2009. it also represents fifth consecutive discovery from 2008-2009 drilling campaign. A preliminary estimate of the exploration reserves of Azhar-1 discovery is in excess of 100 billion cubic feet (bcf) of gas.

Dana Gas ended 2008 with a daily production rate from its Egyptian operations of 31,640 barrels of oil equivalent (boe). This most recent discovery follows the discoveries at El Basant and Salma adding reserves of up to 380Bcf of gas plus associated liquids.

Dana Gas is currently also leading a consortium to build and operate the Gulf of Suez Gas LPG Plant, in partnership with the Egyptian Natural Gas Holding Company (EGAS) and the Arab Petroleum Investment Corporation (APICORP).