QatarEnergy struck a deal with Shell to buy a 27% interest in the North Cleopatra offshore oil and gas block in Egypt, with Shell retaining 36% in the block. The deal is pending the approval of the Egyptian government.
The Qatari state energy major has been expanding in Egypt alongside Western oil majors, including Shell and Chevron, as the North African country seeks to boost its oil and gas production as fast as possible.
Last year, QatarEnergy bought a 40% interest in two Exxon-led blocks offshore Egypt and a 23% stake in a Chevron-operated offshore block that also involved Australia’s Woodside as a partner, along with Egyptian Tharwa Petroleum Company.
Tharwa and Chevron will also be partners with QatarEnergy in the North Cleopatra block. Chevron has a 27% stake in the project, and Tharwa has 10%. The North Cleopatra block neighbors the North El-Dabaa block, in which QatarEnergy also has a stake, at 23%.
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Egypt has ambitions to become a global factor in oil and gas, thanks to its resources, but developing these has proved challenging. Egypt even turned from a net LNG exporter to a net LNG importer at the end of 2024 as the country imported last year the highest number of LNG cargoes in years, as it looked to ease the strain on its grid and industry amid energy shortages that led to rolling blackouts last summer.
The flip resulted from dwindling onshore natural gas production combined with soaring demand for electricity. Now, Egypt and international majors are focusing on offshore resources. Since August, Egypt’s natural gas production has increased by more than 200 million cubic feet per day, according to data from Egypt’s Ministry of Petroleum and Mineral Resources, thanks to the startup of new production wells at an offshore field operated by BP. Oil production has also gone up. This increase has helped Egypt reduce its fuel import bill by $3.6 billion and settle $1 billion in arrears owed to international partners, the oil ministry said last month.
By Irina Slav for Oilprice.com
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