Italian oil and gas company signs agreement for the offshore North Leil and Karawan blocks
The Italian oil and gas company Eni has signed concession agreements to explore two new exploration blocks in the Egyptian Mediterranean.
The deal was announced by Eni on 14 January 2015 and comes in the wake of the award of southwest Meleiha Block which was announced on 9 January.
Both awards are part of the Egyptian General Petroleum Corporation (EGPC) 2013 international bid round.
Eni is the operator and holds 100 per cent equity in North Leil and 50 per cent equity in Karawan, where it partners with BP. The two blocks, which will be operated by Enis subsidiary IEOC, are located in the deepwater offshore of the Mediterranean, west of the Shorouk block, which Eni acquired in 2014. North Leil and Karawan blocks cover areas of 5,105 and 4,565 square kilometres respectively.
The southwest Melehia Block is operated by Eni through its subsidiary IEOC, which holds a 100 per cent stake. The block covers an area of 2,058 sq km.
The southwest Melehia Block is located immediately south of the Melehia license, which is operated by Agiba, a joint venture of IEOC and EGPC, which manages Enis operations in the Western Desert.
Egypt is currently looking to ramp up oil and gas production in an effort to ease its worst energy crisis in decades.
Over recent years demand for natural gas has risen rapidly while domestic production has declined.
During 2014 Egypt went from being a net gas exporter to becoming a gas importer.
The latest flurry of awards to foreign oil companies comes as the government looks to cut its debt to overseas firms, and there has been speculation that EGPC could be awarding exploration concessions in return for reductions to its debt.
On 31 December, Egypt announced a $2.1bn payment that reduced its debt to foreign oil companies to $3.1bn.
Follow Wil Crisp on Twitter: @bilgribs
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