German oil and gas company RWE Dea has started gas production from its Central Treatment Plant (CTP) in the Egyptian Nile Delta. The move will boost the company’s oil and gas production by more than 50 per cent, lifting it from 29,000 barrels of oil equivalent a day (boe/d) to 44,000 boe/d, helping Egypt to battle its ongoing natural gas shortage.

Production from the facility started at an initial rate of 45 million cubic feet a day (cf/d) of gas. Over subsequent days, the company ramped up production to reach a rate of about 90 million cf/d, according to a statement released by RWE Dea on 26 August.

RWE Dea’s partner in the project is Egyptian Natural Gas Holding Company (EGAS). Production is operated by the joint venture Suez Oil Company (SUCO).

The project is part of RWE Dea’s Disouq Development Project, which produced its first gas in September 2013.

“The volumes produced from our gas fields of the Disouq project make an important contribution to Egypt’s domestic energy production to meet the needs of the country’s growing energy demand,” says Dirk Warzecha, Chief Operating Officer (COO) of RWE Dea.

“We started the project during difficult times in the country, which required special measures for security and logistics. With this project RWE Dea demonstrates its commitment to Egypt and North Africa as a core region,” he adds.

RWE Dea intends to connect an additional seven wells to the CTP over coming months, further boosting production as it brings them on stream in 2015.

The facility currently produces gas from five wells in three separate gas fields:

• North Sidi Ghazy
• South Sidi Ghazy
• North West Sidi Ghazi

The announcement of increased production from RWE Dea assets will be greeted with enthusiasm from Egyptian policymakers, who are wrestling with the country’s worst gas crisis in decades.

Domestic gas production is currently declining in Egypt, while domestic demand for gas increases and the country’s population expands.

A shortage of natural gas has led to feed stocks being diverted away from liquefied natural gas (LNG) facilities to meet domestic demand. This has done significant damage to energy company profits and made them increasingly reluctant to increase investment in the country.

The government is currently seeking gas imports to meet domestic demand, but it is uncertain how the imports will be funded.

On 3 August, Egypt’s Oil Minister Sherif Ismail told news agency Reuters that the country owed $5.9bn to international oil companies (IOCs) as of the end of June.

This large debt has further discouraged oil companies from investing in Egyptian assets.

Despite a general trend of declining gas output, several projects have recently come online.

On 21 August, the Denise-Karawan (DEKA) project, located in Egypt’s Temsah Concession Area in the offshore Nile Delta announced that it had started gas production at rate of about 6.5 million cubic metres a day (cm/d).

The project is owned by a joint venture of Ieoc Production, an affiliate of Italian oil company Eni, and the Egyptian subsidiary of UK energy company BP.