• Egypt boosts gas exploration with $343M deals to counter declining output.

• New wells in Mediterranean/Nile Delta involve Shell, Eni, Arcius, Zarubezhneft.

• Production fell to 3.5 BCM/month, forcing $3B LNG imports; success depends on rapid new discoveries.

Egypt is intensifying its efforts to revitalize its natural gas sector, which has experienced a sustained decline in production over the past year. This downturn is largely attributed to a significant drop in output from the Zohr field, a cornerstone of the nation's energy independence.

In response, the Ministry of Petroleum and Mineral Resources announced on August 30, the signing of four new exploration agreements. These agreements, totaling $343 million, will fund the drilling of ten new wells across the Mediterranean and Nile Delta regions. The investments are part of partnerships between EGAS, Egypt's state-owned gas company, and international energy giants including Shell, Eni, Arcius Energy, and Zarubezhneft.

Specifically, Shell is set to invest $120 million for three offshore wells in the Merneith block. Eni, a key player in the Zohr field's development, will drill three wells in East Port Said with a $100 million allocation. Further investments include $109 million for the North Damietta block via Arcius Energy, a joint venture between BP and ADNOC, and $14 million from Russia's Zarubezhneft for four onshore wells in North El-Khatatba.

These recent agreements follow EGAS's allocation of six blocks in June 2025, four in the Mediterranean, one in the Nile Delta, and one in North Sinai. That round secured $245 million in investment and committed to at least 13 exploration wells, underscoring the accelerated pace of gas exploration in the face of eroding production.

According to the Joint Organisations Data Initiative (JODI), Egypt's gas production plummeted to 3.5 billion cubic meters in May 2025, a stark contrast to the over 6 billion cubic meters per month recorded in 2021. This sharp decline has necessitated Egypt's re-entry into the liquefied natural gas (LNG) import market, with 40 to 60 cargoes negotiated at an estimated cost of nearly $3 billion.

The short-term success of this aggressive exploration strategy hinges on the efficacy of the drilling operations and the swiftness with which potential discoveries can be brought into production.

This article was initially published in French by Abdel-Latif Boureima

Adapted in English by Ange Jason Quenum