(Ecofin Agency) - In Upper Egypt, the Minister of Petroleum and Mineral Resources, Tarek El-Molla (photo), has announced that the Ministry has signed two contracts with U.S-based IPR and Cyprus’ Mediterra, for oil and gas exploration.

The agreement was signed between Egypt’s Ganoub El-Wadi Petroleum Holding Company (GANOPE), IPR and Mediterra.

Under the contract, three exploration wells will be drilled with an investment worth $4.3 million and a signature bonus worth $200,000. These wells are situated in sectors 7 and 8 in the country’s southern Al-Baraka field in Aswan, Energy Egypt reports.

According to El-Molla, the agreements will assist in boosting oil production so as to meet domestic demands.

He added that the deal will also strengthen research activities in the southern area of Egypt which has been estimated to hold encouraging petroleum prospects.

Egypt which was once a net energy exporter, started importing liquefied natural gas (LNG) in 2015 and has hired two FSRUs to assist in preventing the lack of electricity caused by a decline in energy production and rising consumption.

The country’s monthly consumption of petroleum products and natural gas is currently at 6.5 million tons. 4.2 million tons out of the 6.5 million tons are locally produced while the remaining 2.3 million tons are imported.

Egypt however, intends to raise its per day crude oil production from 695,000 bbls to 700,000 bbls all through the upcoming financial year.

Anita Fatunji