22 oil and gas exploration concessions will be auctioned in Egypt. State-owned firms EGPC and EGAS announced the auction, which includes areas in the Suez Canal, the Mediterranean Sea, the Nile Delta, and Egypt’s western desert. Advertisements for the international auction have been placed in state-run newspapers by the country’s Oil Ministry.
Exploration ventures offshore Egypt have struggled in the past, due to government payments to producers that pale in comparison to other countries. Egypt’s traditional payment of $2-$3 per million British Thermal Units has deterred exploration companies from working in Egyptian waters, instead looking to Britain’s $10 and Asia’s $17 per BTU as a more appealing exploration opportunity. Egyptian government officials are discussing a change to pricing agreements to encourage more exploration, but no specific amount has been announced.
The auction is set to last several months, ending May 19th.
Dana Petroleum, which has maintained onshore exploration activities in Egypt, has already signed two new oil and gas exploration agreements. The agreements include an investment of $24 million in the country’s western desert.
Egypt’s cabinet approved other oil and gas exploration agreements earlier this month, with BP, Dana Gas, and Petroceltic International.