The results of recent geophysical data analysis in the Red Sea carried out by Schlumberger in cooperation with Ganoub El Wadi Petroleum Holding Company (Ganope) revealed a 70% potentiality for new natural gas discoveries according to a seismic survey.
A source from the petroleum sector told Daily News Egypt that the analysis have shown that the soil layers in the Egyptian territorial waters in the Red Sea came identical to the Saudi side where a new gas discovery was recently made.
The source added that the Ministry of Petroleum has implemented an ambitious plan to place the Red Sea on the gas exploration investment map, in order to achieve new discoveries like those in the Mediterranean Sea.
He pointed out that the ministry has finalised the form of new petroleum agreements in the first exploration tender in the Red Sea, which is scheduled to take place in the first half of this year. The agreements include new incentives, such as increasing the partner’s share and reducing the expense recovery period, in a bid to encourage foreign companies to further invest in Egypt’s oil and gas sector.
He explained further that the exploration agreements will also include the abolition of mandatory abandonment of part of the concession area every two years.
Furthermore, the source said that the amendments were praised by foreign partners.
Egypt pays $2.65 to foreign partners for every million BTU, in most of its agreements, except for some areas of deep water in the Mediterranean.
The source added that gas pricing should be suitable to achieve a return on investment rate consistent with the size of the risks in the oil and gas exploration.
He explained that negotiating on prices with partners will continue for companies to speed up implementing development plans in their concession areas.