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EGYPT - The Non-Associated Gas Fields - Nile Delta & Mediterranean.

Companies producing non-associated gas operate in the Nile Delta and its offshore extensions into the Mediterranean and in the Western Desert. But the Mediterranean is by far the biggest gas producer in Egypt, accounting for 60% of the country's 68 TCF of proven reserves of natural gas - and could hold at least another 80-80 TCF of probable reserves to be found. Since late 2003, most gas production has been coming from deep-water offshore Mediterranean fields north of the delta, the Western Desert and Sinai. EGPC's equities in gas-producing ventures have been taken over by the new Egyptian Natural Gas Holding Co. (Egas), which was created in August 2001.

The main operators in the Nile Delta and the East Mediterranean gas fields are Petrobel (Egas/Agip), an Agip-BP JV, Bapetco (Egas/Shell), the Western Desert Petroleum Co. (WEPCO, Egas/Apache), and BG. Petrobel is the biggest gas producer in Egypt, with its output at present exceeding 980 MCF/d and forecast to peak at 1,304 MCF/d by 2010.

Abu Madi - Petrobel: For many years the biggest gas field in Egypt, Abu Madi, was found onshore in 1967 by Agip (IEOC) which developed it in the 1970s. With its producing wells increased to 21 and facilities expanded by the end of 1992, the field has a capacity of 400 MCF/d. Its plants can produce 7,000 b/d of condensates and 200 t/d of LPG. Abu Madi has important extensions, some in production and others being developed, in which IEOC has other partners.

IEOC's Nile Delta and Mediterranean blocks have proven remaining gas reserves of more than 15 TCF. IEOC's parent group ENI in 1998 launched a four-year, $2 bn programme to 2002 to develop gas fields off the northern coast. ENI has a 20% stake in a gas marketing franchise (see DT No. 1).

Al-Qar'a, the biggest onshore extension north of Abu Madi found in 1985, produces more than 190 MCF/d of gas, 3,700 b/d of condensate and 200 tons/d of LPG. The venture for this field is the Nile Delta Oil Co. (Nidco) consisting of Egas (50%), IEOC (37.5%, operator) and BP (12.5%). It went on stream in April 1992 at the rate of 112 MCF/d from eight wells. It was developed in 1997 to raise its output from less than 170 MCF/d, and to produce more condensates and LPG. Finds added to its stream include Khalala, Nidco-9 and al-Qar'a NW-1. NW-1, found in January 1994, tested 30 MCF/d of gas and 200 b/d of condensate from a 20-metre thick zone. Qar'a gas is processed at Abu Madi.

In the East Mediterranean offshore, IEOC has a number of major gas fields in deep waters, with over 11 TCF of reserves. The biggest are Temsah, Port Fuad, Wakar and Halawa. Except for Halawa, these are held by Egas and IEOC. BP has interests in most of them. The fields lie mainly in 3,820/4,075 m-deep Miocene Fms.

Port Fuad, 35 km from Port Fuad (near Port Said), is a big gas field found in 1992 by IEOC. It lies in Petrobel's offshore North Port Said block. With reserves proven so far at 3 TCF and lying at a depth of 4,000 m, Port Fuad and satellite fields came on stream in April 1996 to initially produce 70 MCF/d of gas and 3,500 b/d of condensate from four wells tied to an unmanned platform remotely controlled from the shore. The output has since risen considerably with the addition of several discoveries, including Sigan field which IEOC found in November 1997 about 54 km north of Port Said. The stream is linked to the national gas network by a 25-km pipeline. Onshore facilities at Port Said, 36 km away and on stream since 1996, treat the gas. Under the JV's agreement, the gas is split 75/25 in favour of EGPC, as in the case of the other new ventures.

IEOC had first found gas from a Port Fuad well in 1982 but it later relinquished the block to EGPC. In 1991 it took that area again as a sole right holder, with the block set at 1,200 sq km, and later began deep drilling near the 1982 well. The 1992 discovery led to drilling of three more wells. The four wells tested 42 MCF/d of gas and 2,000 b/d of condensate.

Wakar, in the same block 20 km north-west of Port Fuad and 17 km north of Port Said, has proven reserves of 1.5 TCF. The pay zone is at a depth of 4,000 m. It began production in February 1997 from a platform like that of Port Fuad, then with a capacity of 42 MCF/d of gas and 2,740 b/d of condensate. The output has since risen considerably. IEOC and EGPC in October 1997 signed an agreement under which the Agip unit built a 42-km gas pipeline from the Port Said processing plant to serve Egyptian users in Sinai. With a capacity of 4,000 MCM/y, the pipeline went on stream in late 1999 at the cost of about $60m. The line complements water pipelines built under the Suez Canal to bring fresh water from the Nile to Sinai.

Darfil in IEOC's Port Fuad block, came on stream in 1997. East Delta, a smaller field in IEOC's East East Delta block, came on stream in 1996.

IEOC/BP - Mediterranean Gas Co. (MGC) was formed in February 1997 as a JV of EGPC (50%), IEOC (25%) and BP (25%) to develop big gas fields in four offshore blocks: Temsah and East Delta Deep Marine operated by IEOC, and Baltim and Ras el-Barr operated by BP. It was assumed in August 2001 that EGPC's equity would be taken up by Egas. Gas production from them began in late 1999. The four MGC blocks are the only ones in which IEOC and BP are equal partners. MGC's output in 2004 reached 1,000 MCF/d by 2004. Most of the gas is being exported by to Jordan by pipeline and to Europe and the US in LNG form.

IEOC and BP hold interests in a steadily growing number of gas-rich blocks in the Nile Delta and nearby offshore Mediterranean areas.

Temsah, with proven reserves estimated at 3 TCF, has been on stream since early 1997 and will be a major producer. The field, in the Temsah block off Damietta north-west of Wakar and near al-Qar'a, lies at a depth of 13,300 ft, with 260 ft of water. It has important extensions developed and put on stream at end-1999. Other fields on this block include Denise N, in about 374 ft of water having gas in Fms at depths of 4,308-4,981 ft. The first Temsah find in early 1996 tested 35 MCF/d of gas and about 2,400 b/d of condensate. The block is held 50% by Egas, 25% by IEOC (operator) and 25% by BP. Temsah has a main unmanned platform directly linked to an onshore processing plant.

Baltim, a big offshore Mediterranean field on stream since late 1999, has a plateau capacity of 460 MCF/d. It is one of five Mediderranean (Med) fields developed for a total plateau capacity of 1,500 MCF/d. The others are Ha'py and Seth operated by BP, Rosetta operated by BG and IEOC's Temsah extensions.

Baltim, in BP's Baltim block, is one of the biggest offshore finds in the East Med made in July 1993 by Amoco. The Baltim block is held 50% by Egas, 25% by BP (operator) and 25% by IEOC. The gas lies in a Messinian Fm of Abu Madi sands at a depth of 12,835 ft and in 144 ft of water. The discovery well tested at 31.6 MCF/d of gas and 586 b/d of condensate. Baltim is 25 km from the shore. It has three unmanned platforms and an onshore processing plant near Abu Madi.

IEOC's Baltim South, excluded from the MGC, came on stream in February 1997 at the rate of 11.6 MCF/d of gas and 315 b/d of condensates, both of which being piped to the al- Qar'a processing plant. Also excluded from the MGC is East Baltim, in a separate block in which BP is the operator. East Baltim, on stream in early 2000, produces 260 MCF/d. In announcing its $2 bn 1998-2002 development plan, IEOC said in 1997 about $700m were to be spent for the drilling of 50 gas wells. It was to conduct geological studies and expand its gas production system and pipeline infrastructure.

Ras el-Barr is a very rich offshore gas block off the Delta coast where Amoco first found gas/condensates in early 1995. It is about 45 km off the town of Damietta. It includes the giant gas fields of Ha'py and Seth and their satellites in Pliocene Kafr al-Shaikh Fms, with 4 TCF of proven gas reserves and a big reserve of condensate, developed and put on stream in February 2000 by BP. Their output exceeds 400 MCF/d, with the gas sold to the local market. Its development and a related gas processing plant cost $180m. Condensate output has been rising gradually. The two fields have an unmanned, remote-controlled platform in 260 ft of water. The gas goes through a 70-km pipeline to a new processing plant built 20 km west of Port Said.

Amoco and IEOC on Nov. 4, 1997 signed with EGPC a long-awaited contract whereby EGPC was to buy their gas on a take-or-pay (ToP) basis, for domestic consumption for a period of 25 years. BP has a rapidly expanding CNG business which supplies vehicles in Egypt (see DT No. 1).

The East Delta block, another gas-rich area operated by IEOC. Its partner is Total. One discovery there made in July 1990 about 30 km from Abu Madi tested 10.3 MCF/d of gas and 1,100 b/d of condensate. Halawa, found in Feb. 1992 south-west of Lake al-Manzala, tested 55 MCF/d of gas and 900 b/d of condensate from two pay zones at 10,300 ft. Halawa, with proven reserves of 1 TCF, produces 42 MCF/d of gas and 500 b/d of condensate. The output is piped to a treatment plant at Port Said which came on stream in 1996.

BP Egypt, in partnership with other companies, on the whole is producing over 1,200 MCF/d of natural gas. With several major gas finds made and to be developed, its production in Egypt will soon exceed 1,350 MCF/d and will remain one of the top four biggest gas producers in the country. It is also to be an exporter of LNG from Egypt (see Part 3 in Gas Market Trends No. 3).

Rosetta - Rasheed Petroleum (Rashpetco): Formed in 1997 to develop and market gas from the offshore Rosetta block, Rashpetco is a JV of Egas (50%), British Gas (BG Group - operator with 20%), Shell Egypt (10.2%), Shell Austria (9.8%) and Edison Int'l (10%). Edison is a US unit of Italy's Montedison chemical group. In April 2003 Petronas of Malaysia bought Edison's Egypt assets, including its 10% stake in Rashpetco for about $1.75 bn. In August 2004, BG exercised its pre-emptive rights against a June bid by Kuwait's KUFPEC to buy the 20% Shell stakes, and thus in September 2004 raised its equity in Rashpetco to 40% for about $235m.

Rosetta block, north of the Delta town of Rasheed, lies between Abu Qir to the west and Baltim to the east and has a giant gas field found in April 1997 with important extensions found subsequently and proven reserves of 2 TCF. The first find was in 200 ft of water 48 km north-east of Alexandria in three net gas zones of over 460 ft of sandstone at about 6,000 ft and tested 60 MCF/d. The second, Rosetta 5, in November 1997 tested over 90 MCF/d which was the highest rate in any gas find made in Egypt. Also in November 1997 Rosetta 6 tested 40 MCF/d. These and subsequent finds in Rosetta went on stream on Jan. 31, 2001. BG says the Rosetta gas is of very high quality with less than 0.5% impurities. Rashpetco reached its 20-year plateau output of 275 MCF/d and 300 b/d of condensate in late 2004. But Rashpetco's second phase of the development, involving an unmanned wellhead platform tied to Phase-1 Platform got the system to peak at 345 MCF/d in May 2005. Rashpetco and Egas amended their 20-year ToP contract and its Daily Contracted Quantity (DCQ) to the latter volume.

Bashpetco's production system it tied a 66 km gas/condensate pipeline to an onshore terminal near Idku, about 50 km east of Alexandria. After processing at an onshore plant, the gas is delivered to the national grid. The condensate is exported by pipeline to a gathering centre at Abu Qir, 15km east of Alexandria. The system's capacity is 380 MCF/d.

Burullus Gas Co, formed in 1999, is a 50-50 JV of Egas and BG (operator) developing several finds on the West Delta Deep Marine (WDDM) block, 60 km off the Nile Delta, made by BG since late 1997. WDDM's giant, the 4 TCF Scarab/Saffron complex began production for the local market from early 2003. Development of this complex, which has $650m, was done by Rashpetco as a contractor on behalf of Burullus Gas Co. (BGC). The BGC system is a first for Egypt in that it involves subsea technology in depths reaching 700 metres. It consists of an initial eight production wells controlled from the shore. The gas is processed at the Rosetta onshore plant, which has been expanded for BGC. Their output was set to rise from 475 MCF/d to 633 MCF/d on Jan. 1, 2006, to feed the domestic market under a long-term ToP contract signed with Egas.

BGC's Simian and Sienna fields began production in March 2005. These and the other BGC deep-water fields have been committed to supply the Dameitta LNG export venture of Segas with 225 MCF/d for four years from early 2005, and another 150 MCF/d for the fifth year in 2009. Together with gas to feed the BG-led Egyptian LNG (ELNG) venture at Idku, the BGC's fields which will include Sapphire and others will eventually be producing over 1,400 MCF/d. They will make BG the largest producer of natural gas in Egypt.

Sapphire 3, the 12th BG find on the block, in 2001 had confirmed the largest gas column in Egypt. The well, 20 km north of Rosetta, was drilled to 2,900 m in 450 m of water. The first target was Saffron Channel C. The well proved pressure communication between Channel C and Saffron, indicating a gas column in excess of 575 m. A second target was the Sapphire sands. The well penetrated all sands present in Sapphire 1 and Sapphire 2, located 15 km west of Sapphire 3. Pressure data and geochemical analysis indicated that all three wells were in communication. The 13th find, Saurus-1 in a water depth of 630 m, was announced in November 2001 and continued BG's 100% drilling record on the block. Saurus-1 tested 30.89 MCF/d. Saffhire is to be on stream in the first quarter of 2006 (BG and its partners have set up Egyptian LNG to export LNG from the 4 TCF Simian, Sienna, Sapphire and other fields on the WDDM block, with the two LNG trains at Idku in 2005 well ahead of schedule - see Part 3). BG calls WDDM as the "jewel in the crown" of its Egypt portfolio, with the British major having found over 16 TCF of gas in this country. In April 1998, BG and its partners signed a 25-year franchise with EGPC (now Egas) to market gas in Upper Egypt through the new Nile Valley Gas Co. (see DT No. 1).

BP has the adjacent West Mediterranean Deep Marine (WMDM) block. For this, BP in mid-1999 began a $310m exploration programme. BP has an adjacent East Delta Deep Marine which it is exploring. BP also has projects to export gas by pipeline and in LNG form. For its part, Shell has the nearby North East Mediterranean Deep-Water block.

The offshore North Sinai block, held by BG (operator) and BP, is another gas-rich area at the eastern end of the Delta zone. BG is developing the block's Thekah field, found in mid-1997 which tested over 25 MCF/d of "very high quality gas" with less than 0.5% impurities, in 14 metres of water about 90 km from Port Said. This is in more than 188 ft of net gas zone in Middle Pliocene Kafr Al Shaikh sandstones at a depth of less than 5,000 ft. BG later made other gas discoveries there as well as off Israel and off Gaza, with prospects targeted being of the same Fms as those of the Nile Delta and Mediterranean. BG, producing oil in the GOS, has a block in the north of the Red Sea acquired in 1996 in partnership with Lasmo (now part of Agip) and Petronas.

El-Tamad - Merlon: Merlon Petroleum of Houston has fast-tracked development of el-Tamad field in the southern part of the onshore el-Mansoura exploration block in the Nile Delta. Drilled in July 2005, the el-Tamad oil and gas field was put on stream at end-2005 at a rate of 1,000 b/d of oil equivalent. Before that it was to spud the first of four shallow Sidi Salim exploration wells on the Tamad oil trend.

El-Tamad-1, spudded on March 28 2005 about 9 km east of the March 2005 Shinfas-1 find, flowed in excess of 2,000 b/d of 46 deg. API oil and 1.5 MCF/d gas from the primary Miocene Sidi Salem Fm objective on a 2016-inch choke. Logs indicated a gross hydrocarbon column of 27m and proven reserves were estimated at 12-14m barrels of oil and about 20-50 BCF of gas. In addition to the Shinfas-1 Pliocene gas find, Merlon drilled the Aga-1 Pliocene gas discovery in 2004.
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Publication:APS Review Gas Market Trends
Date:Jan 9, 2006
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Previous Article:EGYPT - The Western Desert Oil Fields & Operators.
Next Article:EGYPT - El-Wastani/Manzala/Hana - Centurion.


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