In a bid to expand its search for new hydrocarbon reserves and become a net exporter of gas, Egypt has awarded Anglo-Dutch Shell, U.S. oil major Chevron and Abu Dhabi’s Mubadala oil and gas exploration rights in the Red Sea.
Chevron and Shell were each awarded a block and Mubadala will share a block with Shell. According to Egypt’s ministry of petroleum, the concessions cover a total acreage of 10,000km2, with a minimum investment of $326 million.
An agreement of maritime demarcation between Egypt and Saudi Arabia allowed Egypt to launch its first international bidding in the Red Sea, and as a result, a large gas discovery was made by Saudi Arabia. An investment feasibility study on the scheme will be conducted and exploration will be intensified over the next two years.
The outcome of the first international bidding round may have a positive impact on Egypt’s oil and gas sector and could attract other major companies to join bidding rounds in the country.