The Mediterranean gas play is creating a major production hub.
Egypt is planning a road show early this year to promote its current licensing round, including eight offshore blocks that should get a lot more interest than they did when the industry rejected them in 1999.
Some 43.5 Tcf of proven (100 Tcf of potential) reserves of gas are turning Egypt's offshore gas play into a source of local supply, a headwater for regional gas, an enabler for a liquefied natural gas (LNG) industry and a catalyst for future discoveries.
Those reserves also are drawing a crowd. Among the 32 concessions offered by the state-owned Egyptian General Petroleum Corp. (EGPC), eight are offshore and adjacent to big discoveries. Blocks A1, A2, A3 and A4 compose the original Matruh Deepwater area offered in 1999, and blocks D1, D2, D3 and D4 make up the original Northwest Mediterranean Deep immediately offshore from the Matruh tract.
Veritas DGS has shot some nonproprietary
2-D seismic over the Northwest Mediterranean Deep, and the whole area is in the path of TGS-Nopec's Mega-Med survey.
Egyptian Petroleum Minister Sameh Amine Fahmi said European, US and Canadian companies already have shown interest in the licensing round, which closes Feb. 28.
The tracts to the east of the offered properties have shown tremendous results for BG, Edison and BP. Those companies played a major role in moving Egypt to 18th place in the world in gas reserves.
Since 1997, BG has drilled 17 successful wells out of 18 tries and discovered more than 10 Tcf of gas. Gas from the Rosetta concession off the Nile Delta began flowing in January 2001, 4 years after its discovery, and BG will ramp up production to 275 MMcf/d by the middle of this year.
In August 1999, the company signed a gas sales agreement for its Scarab/Saffron field - the largest in Egypt - in 2,300 ft (700 m) of water in the West Delta Deep Marine Concession with 4 Tcf of gas reserves. It will produce first gas in January 2003, increasing production to 533 MMcf/d. Burrullus Gas, a combination of BG, Italy's Edison and EGCP, is working the project.
Stolt Offshore landed the US $145 million contract for subsea construction and pipelay services to bring gas from the Scarab/Saffron complex to shore.
As an example of the kinds of wells coming on line, Scarab-1 tested at more than 30 MMcf/d and Saffron-1 tapped two zones for 90 MMcf/d. Among other discoveries, Simian-1 and the P12/P13 wells each tested at 44 MMcf/d of gas. Simian-2 is in the deepest water to date at 3,232 ft (985 m). The first well in the West Delta Deep, Sapphire-1, tested 3 MMcf/d of gas in July 2000, and Sienna-1, southwest of Simian, tested for 23 MMcf/d. The newest discovery in the area, Saurus-1, 75 miles (120 km) north of Alexandria, toward the west side of the concession, tested at 30.9 MMcf/d on a 56/64-in. choke.
Burrullus will use gas from the West Delta Deep to supply a two-train LNG export plant that the company will build at Idku, east of Alexandria, Egypt.
BP started a 130-day exploration program recently with the Aztec prospect in its West Mediterranean Deep Concession west of the West Delta Deep and east of the Matruh Deep tract. When it finishes that well, it plans to move the Transocean Sedco Forex Sedco Express to the Abu-Sir-1x well on the Blue prospect operated by Apache in 3,281-ft (1,000-m) waters. Apache has two-thirds of that project, BP 16.7% and GWE-DEA of Germany the remainder.
Following that, BP will bring the rig back to drill the Ruby prospect, possibly in the second half of the year.
The company already had tested its Libra well in the tiny North Alexandria block between Rosetta and the West Mediterranean Deep for 22 MMcf/d. The 500 Bcf of reserves spurred plans for a six-well development program.
It also spurred BP to buy out TotalFinaElf, its partner in the West Mediterranean Deep. BP is committed to spending at least $48 million before the exploration period runs out in 2004.
BP previously reported a test of 21 MMcf/d from one zone and 6 MMcf/d from another in its 600 Bcf Fayoum discovery in the North Alexandria blocks.
BP has discovered 2 Tcf offshore Egypt.
The company also is a partner with Shell in the Northeast Mediterranean Deepwater Concession north of the West Delta Deep and West Mediterranean Deep tracts. Only one well has been drilled on that property. It has gas shows.
Like BG, BP also has committed to a gas liquids program. It has signed a pact with the Egyptian government that includes one two-train natural gas liquids plant with first deliveries to the Egyptian market in 2003. It signed another deal for a two-train LNG plant with first deliveries in 2004.
The three gas liquids plants will cost some $3.2 billion and will handle 477 Bcf a year.
Those plans still leave Egypt with a lot of gas and the operators with opportunities for further markets.

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