Egas awards blocks in offshore licensing round

Uchenna Izundu
OGJ International Editor

LONDON, May 15 -- Egyptian Natural Gas Holding Co. (Egas) awarded deepwater blocks under its licensing round off the Nile Delta.

BP PLC secured Block 2, which covers 2,400 sq km in 1,000 m of water about 60 km north of Port Said City. It will solely operate the North Tineh block and drill three exploration wells during two phases totaling 6 years.

BP will operate deepwater Block 3, which is adjacent to Block 2. North Damietta covers 1,600 sq km and carries a commitment of drilling four exploration wells over 6 years. Its partners will be Royal Dutch Shell PLC and Petronas, with one third working interest each.

BP Egypt Pres. Hesham Mekawi said the blocks would "transform BP's gas exploration opportunities in the Nile Delta and increase BP's options for further significant growth." Mekawi said, "The new partnership that has been created also brings together companies with great technical capabilities to meet the challenges of exploring for high pressure gas resources in the deep water Nile Delta."

BG Group won Block 1, North Gamasa and it has to drill two wells.

Enel SPA and Total SA snapped up the El Burullus block, which Total will operate the license with 90% interest and Enel will have the remainder. The block covers 2,516 sq km. The license will last 4 years and the partners must shoot 3D seismic and drill wells.

State-owned Egas opened the licensing round with seven gas blocks in September last year and Block 3 proved to be the most attractive. It extended the deadline from Feb. 9 to Mar. 31.

The blocks, spanning 21,463 sq km, are called North Gamasa, North Tineh, North Damietta, El Burullus, El Mamura, El Dabaa, and Sidi Barrani. They were offered on a production sharing agreement basis.

According to media reports, only blocks North Gamasa, North Tineh, and North Damietta, had interested investors.

Contact Uchenna Izundu at [email protected].