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EGYPT - Apache - Khalda, WEPCO & Other JVs.

Apache is the main producer of liquids and natural gas in the WD. Its output there consists of 82,000 b/d of 35-46? API oils (up from 30,000 b/d in early 1998), 18,000 b/d of condensate and 700 MCF/d of gas. In August 2013 it sold 33% of its Egyptian assets to China's Sinopec for $3.1bn. The main Apache operations are: Khalda Petroleum Co. (KPC) whose fields include Khalda, Salam, Hayat, Safir, Tut, Yasser, Aoun, Tareq, Kahraman, and Shuruq; Western Desert Petroleum (WEPCO), whose fields include Alamein, Yidma, and Umbaraka, with some of them yielding a small volume of crude oil; Abu-Qir Petroleum Co. (AQPC), in which its partner is Edison of Italy; and Abu al-Gharadiq, whose fields include shale oil the US company intends to tap.

Apache has made the biggest number of gas finds in Egypt since the 1990s.

Agiba Petroleum Co. (Agypetco), a JV of EGPC (50%), IEOC (28%), LUKoil (12%) and the World Bank's IFC (10%), produces about 24,000 b/d of crude oils from its Meleiha and West Razzaq blocks, from 50,000 b/d in late 2003. Output comes from its Meleiha fields (found in 1972 with 31.6[degrees] API oil), Ighar (1987), Falak (1988), West Razzaq (1994) and others. IEOC is the operator.

IEOC in December 2011 had an oil find in Meleiha block: Meleiha-78 at 6,000 ft. Zarif-1X, south in the Meleiha field, in September 2011 reached 10,000 ft and encountered an oil pay. Their development was fast-tracked to boost Agiba's oil output. In early 2013, IEOC found 80 metres of oil at the Rosa North 1X well and successfully tested reservoir flows, with oil between 43 to 48? API. IEOC later in the year drilled two wells in that area for development of the discovery, with production estimated at 2,000 b/d each. Production of 5,000 b/d is expected in 2014 and will be delivered to processing facilities at the Meleiha field.

Badreddin Petroleum Co. (Bapetco), EGPC/Egas-Shell, produces 10,000 b/d of 38[degrees] oil (14,000 b/d in early 2000 & 22,000 b/d in 1995), from Badreddin (1982), BED-2 (1988) and other fields. Shell also produces 15,000 b/d of condensates from these fields. Bapetco's gas production system is a 50-50 JV of Egas and Shell. Its first Badreddin field, BED-1 found in 1982, is an oil producer. Two gas fields, BED-2 and BED-3, were found in 1987/88. BED-3 went on stream in mid-1990 at the rate of 100 MCF/d and cost over $370m to develop - including a gas processing plant and a pipeline. Its output rose to more than 125 MCF/d and 12,000 b/d of condensate by end-1990, reaching a 165 MCF/d target in mid-1992.

BED-2 went on stream in mid-1992. Shell developed Sitra (1987) and other Sitra units (1992/93) and brought them on stream in June 1993. The output from all these fields rose to 350 MCF/d. Bapetco's proven reserves in that area are over 120m barrels of oil and 2 TCF of gas. The 660 BCF BED-2 in Upper Cenomanian sandstone at depths below 2,200m. The 1 TCF BED-3 is 20 km east/SE of BED-2.

In 1988, Shell had a major gas find in the north of the WD between the Qattara Depression and Lake Qarun. Since then it has linked its gas to the national grid. The gas is sold under a ToP contract with Egas. Most of the gas is pumped through a 270-km pipeline to the Ameriya petrochemicals complex west of Alexandria.

Obayed, one of Shell's giants found in 1992 in the Obayed block, went on stream in 1999 with a capacity of 300 MCF/d and 40,000 b/d of condensates. Since then Shell's condensate production capacity has risen to 54,000 b/d but later dropped to less than 30,000 b/d. Obayed is 10 km west of Marsa Matruh and along the Mediterranean coast. Its recoverable reserve was put at 1.4 TCF. EGPC officials said it could be as large as 9 TCF, thanks to further finds in that area made by Shell since late 1992. The field lies in Jurassic Ras Qattara and Khatatba sands, gas-rich Fms which have aroused the interest of all WD operators.

Shell now is producing 600 MCF/d. The gas is supplied to the national grid, under a 25-year ToP contract signed in 1996, through a 34-inch, 315 km pipeline built to the Ameriya gas complex. This pipeline is shared by Khalda (KPC - operated by Apache) but run by Shell.

The system includes a 12-inch, 55-km condensates pipeline from Obayed to Meleiha, loading and reception terminals, and crude oil and condensate storage facilities and pumping stations at Meleiha.

Shell has spent over $660m in developing Obayed. This included 21 wells, a gathering network and various facilities (see background in gmt2EgyptFieldsJan11-10).

Shell got the North East Mediterranean Deep-Water (NEMED) block in water depths of up to 3,000m. Code-named "Project Wonder", this is the deepest area to be drilled in Egypt's offshore and the block - 41,500 sq km - is about half the size of the entire deep-water Gulf of Mexico.

In 1999 Shell began an exploration programme on the block - with over $150m spent in the initial five years, $50m spent on a four-year Phase-2, and $40m set for a three-year Phase-3 - for a total of 10 wells. The target is the Cretaceous and Jurassic and Shell was said to expect NEMED to have recoverable reserves of 10-15 TCF of gas, and 1-4bn bls of liquids. This will be the source of a GTL/LNG export venture which, together with field development costs, would require over $15bn. Bur Egas now is prioritising the domestic market, which makes Shell hesitant about the project.
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Publication:APS Review Gas Market Trends
Date:Jan 13, 2014
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