Massive Gas Find a Boon for Egypt, Salve for Energy Crisis

31 Aug 2015 | Author: | No comments yet »

Eni’s natural gas discovery in Egypt a gift from heaven: Expert.

A new super-giant natural gas field could prove to be the largest ever discovered on earth and also end up satisfying energy demand in parts of the Middle East and the Mediterranean for decades to come.

Italy’s Eni has discovered gas reserves of up to 30 trillion cubic feet in Egypt’s offshore Zohr prospect, making it the largest gas discovery ever in the country and in the Mediterranean Sea, the company announced on Sunday. The breakthrough could also lead to other discoveries in Egypt, helping the country to reach self-sufficiency in less than five years, according to the government official.

For Egypt, which has been facing severe power cuts and natural gas shortage, the timing of the discovery couldn’t have been better, says El-Ansary, a former senior executive at Shell International with experience in Europe, Russia and the Far East and currently chief executive of Tri-Ocean Energy, an Egyptian-based oil and gas company. “After the Sharm El-Sheikh economic conference [in March] a lot of new power stations were contracted by the government, approximately 70% of which will depend on natural gas to operate … we didn’t know how we would supply all these new power stations and meet the demands of the existing and new factories, which are needed for industrial development,” he said. The discovery, which could contribute to Egypt’s energy mix for “decades,” could also help the country break a potential over-reliance on the Persian Gulf States and other OPEC nations. The new find is located roughly 200 KM away from Eni’s Temsah, one of Egypt’s biggest gas production platforms located about 60 KM from Port Said. “Their [Eni] Temsah Concession Area has pipelines dedicated just for this platform, but as we speak now, the field of Temsah has finished most of its reserves/production, meaning that the platform and pipeline now have perhaps around 70% of free capacity,” he said. “Most probably a Subsea completion process will take place, where wells are completed on the sea floor using underwater wellheads, and connected to Temsah by a new inter-connecting pipeline.” Eni has been present in Egypt since 1954 through its subsidiary IEOC, a company that has always been a frontrunner in exploring and extracting gas resources in Egypt since the discovery of the Abu Maadi Field in 1967.

The company wants to start drilling and setting up new pipelines next year with the first benefits potentially coming on stream by 2018 but Descalzi refused to put a firm date on when production could begin. “I don’t want to put a date now but it is a question of a few years to have production—then a full production, that will be a very quick fast track development,” said Descalzi.

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