EGYPT - Part 1 - The Prospects For Gas Overtake Those For Oil.
A total of about 100 discoveries have been made in Egypt since the previous record of 1996, and most of them are rich fields of natural gas. The chances of foreign companies finding major oil reserves have declined. Most of the known oil basins have reached maturity. The big players among the foreign operators in the country are concentrating exploration on gas-bearing zones. Some of these zones have proved to be among the richest in the Middle East and Africa (see geological profile on the following pages and exploration in Gas Market Trends).
The shift to natural gas for domestic energy in recent years has helped in a major surge of Egypt's economy, which in the past five years has had the best performance in the Arab World. Rapid economic growth and accelerated privatisations have turned the country into a "tiger economy" (see DT).
Egypt's oil production has fallen from a peak of 950,000 b/d in the third quarter of 1995 to less than 818,000 b/d. Despite the fact that the state-owned Egyptian General Petroleum Corp. (EGPC) has a large number of foreign partners producing oil, their output has declined steadily since 1995. BP Amoco, the largest oil producer, is trying to keep its low output of 300,000 b/d from falling further in the Gulf of Suez during the coming six years (see fields and operators' profiles in Part 2).
For the first time in many years, Egypt in 1999 had a deficit of $81m in the oil sector's balance of payments, compared with surpluses of $103m in 1998 and $861m in 1997. The fall in output, occasioned by a rapid rise in domestic oil use, compelled EGPC to buy additional volumes of crudes from its foreign operators. In view of this, the government decided to speed up plans for the export of natural gas by pipelines and in LNG form. The decision was taken at the first cabinet meeting of Atef Obaid's government which was formed in October 1999. There are three different LNG export proposals and calls for three export pipelines (see Part 3).
Led by Petroleum Minister Sameh Fahmi, the decision makers for this sector are now geared to maximised gas economics for both the domestic market and exports. With foreign companies announcing gas discoveries every month, the decision makers have the green light from the top political leadership. President Mubarak is the champion of Egypt's rapid socio-economic development and its leap into the technological challenges of the 21st century (see who's who in Part 4).
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|Comment:||EGYPT - Part 1 - The Prospects For Gas Overtake Those For Oil.|
|Publication:||APS Review Oil Market Trends|
|Date:||Jan 3, 2000|
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