State-owned Egyptian General Petroleum Corporation (EGPC) has formed a consortium with Italy’s Eni and Russian energy company Lukoil to build a natural gas processing plant in Egypt’s Western Desert, according to a local media report.

The plant will have a capacity to process 100 million cubic feet of gas a day (cf/d), and will require investments worth $700m.

The construction will start once government approvals are issued, and is expected to start before year-end, according Mohamed al Kaffas the chairman of Agiba Petroleum, a joint venture between EGPC and Eni.

The official said that the plant will receive natural gas from companies working in the Western Desert and will link it with the natural gas complex in Alexandria through a 200 kilometres-long pipeline.

Construction of the plant is expected to be completed in three years, Kaffas said, adding his company will dig 28 new natural gas wells that will enter production in tandem with the new station.

Agiba has been active since 1981 with operations mainly focussed in Eni’s oil and gas concessions located in the Western Desert.

Egypt’s gas production currently stands at 5.5 billion cf/d, after adding some 1.6 million cf/d as a result of starting production from several projects, including the giant Zohr gas field.

The country's total natural gas consumption is about 6 billion cf/d, of which roughly 65 per cent goes to the electricity sector.

The new discoveries are expected to turn Egypt into a net exporter of natural gas from a net importer.

Egypt plans to stop importing liquefied natural gas (LNG) by the end of its current fiscal year ending in June, as it accelerates production at a number of newly-discovered gas fields, the country’s Petroleum Minister Tarek el-Molla said in January.