Egypt announces record-high crude oil production for first time in decades

Over the past six years, Egypt has achieved 295 new petroleum discoveries, 197 crude oil discoveries and 98 gas discoveries in the areas of the western and eastern deserts, the Mediterranean, Sinai, Delta and the Gulf of Suez. These discoveries have added to the petroleum reserves about 371.619 million barrels of oil and condensates, and about 38 trillion cubic feet of natural gas. The total production of petroleum wealth amounted to about 440 million tons, 189.6 million tons of crude oil and condensates, about 234 million tons of natural gas and 7.8 million tons of butane gas other than butane produced by refineries and investment companies.

In this context, Abdel Sadiq noted, “The production rate from the company’s fields reached about 61,000 barrels of oil equivalent per day during the year, and by adding the company’s share of production of the participating companies, the total production exceeds 95,000 barrels of oil equivalent per day. Several measures were taken and had a direct impact on increasing the productivity of some docks and land wells, mainly Al-Hamad Wharf that saw a productivity increase from 4,400 to 9,900 barrels per day, using the latest technologies in the field of electrical recordings in marine wells for the first time in Egypt.”

Talaat al-Suwaidi, a member of parliament and head of the parliamentary Energy and Environment Committee, said the ministry’s announcement that Egypt has reached a record in crude oil production shows that President Abdel Fattah al-Sisi attributes great importance to supporting this promising sector. 

Suwaidi told Al-Monitor over the phone that Egypt has become one of the most important countries in the Middle East and Africa region, which attracts global investment. He underlined that Egypt’s production has enabled it to achieve self-sufficiency in gas and resort to exporting.

Atef Hassan, head of Petrobel, told Al-Monitor that Egypt is currently producing about 1.1 billion cubic feet of gas per day and about 70,000 barrels per day of crude oil, after its success in implementing plans to develop production fields in the Gulf of Suez, in addition to 12,000 barrels of condensate per day and about 280 tons of butane gas per day.

He pointed out that Petrobel made investments in the fields of exploration, development and operation of gas and crude oil fields, amounting to $720 million during the ending fiscal year. It also succeeded in rationalizing expenditures by more than $50 million, amid highly efficient production processes and plans.

On Sept.16, Eni and its partner BP announced the discovery of new gas in the Greater Noros area, in the Abu Madi West lease agreement, off the coast of Egypt.  

Hassan noted that Egypt announced in August the starting operation of al-Hamra petroleum port in New Alamein, which comprises 12 petroleum agreements with international companies, including eight with the Egyptian Natural Gas Holding Company, for research, exploration and drilling in the Western Desert, the Red Sea and the Mediterranean Sea. He added that the total investment in research and exploration for these agreements exceeds $1 billion.

Egypt owns eight crude oil refineries with a production capacity of around 38 million tons — only 25 million tons of which are exploited yearly.

According to figures issued by the Central Agency for Public Mobilization and Statistics at the end of August, and cited by the Egyptian Al-Bawaba news website, crude oil imports increased by 34.7% to a record $217.6 million compared to $161.5 million. Forecasts indicate that Egypt’s oil imports will drop by at least 17% due to a decline in imports of crude oil and petroleum derivatives by 17.1% during fiscal year 2021, to reach 18.4 million tons, compared to 22.2 million tons during fiscal 2020.

Egypt has been seeking for years to transform into a regional hub for trade in gas and petroleum, as part of its National Energy Efficiency Action Plan.