EOG Newspaper December 2023 Issue by Egypt Oil & Gas

EDITOR’S LETTER

EGYPT’S LEADING OIL & GAS MONTHLY PUBLICATION

Dear Reader,

Infrastructure plays a pivotal role in the oil and gas industry, encompassing the extensive network of facilities and systems that enable the exploration, production, transportation, refining, and distribution of oil and gas products. This intricate group of elements that make up infrastructure forms the backbone of the global energy supply, facilitating the movement of these essential commodities from remote extraction sites to consumers worldwide.

General Manager Ayman Rady Research & Analysis Manager Dr. Mahinaz El Baz Managing Editor Ihab Shaarawy

Egypt, strategically positioned at the juncture of three continents, has long recognized its potential to become an oil and gas trade hub. To realize this ambition, the country has embarked on a series of initiatives to bolster its infrastructure and position itself as a key player in the global energy landscape.

Senior Editors Rana Al Kady

In this issue, our writers delve into some of these endeavors that have established Egypt as a prominent hub for energy trade. Egypt has dedicated significant resources to expanding and modernizing its oil and gas infrastructure, including pipelines, storage facilities, and liquefied natural gas (LNG) terminals. These investments have expanded the country's capacity to handle increased volumes of oil and gas, facilitating efficient transportation and export.

Senior Writer Sarah Samir

The overview section sheds light on some of these success stories, while the economics section highlights the evolving requirements for LNG in response to rising demand. Industry Insight introduces you to the dynamics of clean energy infrastructure, and our Research and Analysis team provides a comprehensive overview of Egypt's natural gas pipelines. We hope you find this issue informative and engaging.

Nader Ramadan

Staff Writers Fatma Ahmed Doaa Ashraf Research & Analysis Supervisor Reham Gamal Research Analysts Jolly Monsef Mariam Ahmed

Ihab Shaarawy

Abdullah Mostafa Statisticians Nada Abbas

MANAGING EDITOR

Hagar Tarek Chief Reporter Wael El-Serag

CONTENTS

Marketing Specialist Shrouk Ihab Creative Art Director Omar Ghazal

20 Years of Resilience and Growth

Senior Graphic Designer Merna William

An interview with HUssam Abu Seif, Regional Vice President, TAQA

Motion Designers/ Video Editors Amira Hassan Esraa Sherif 3D Visualizer Tamer Gamal Photographer Hady Nabil

Egypt’s Natural Gas Pipelines Towards a Regional Transit Hub

AR Revolutionizes Oil and Gas Industry with Enhanced Efficiency, Safety, and Cost-Effectiveness

Egypt's Energy Infrastructure: A Cornerstone for Regional Energy Trading Dominance

LNG Has Turned the Tables of Energy Infrastructure Economics

The Trailblazing Transition: Natural Gas & Clean Energy Infrastructure

Tower No.12 - Bavaria Compound, Ring Road in front of sama Tower - Egypt

Challenging Scenarios for Post-War

24 Gaza

CEO Executive Assistant Noha Zayed Web Master Olfat Kamel Web Developer Mohamed Elwakeel Administration Taghreed Mounir Senior Accountant Mahmoud Khalil Accountant Mohamed Nagy

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Distribution Officers Mahsoub Kenzi Mohamed El-Sayed Mahmoud Nabil Osama Mohamed Hesham Mohamed

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EGYPT OIL & GAS NEWSPAPER

Cleaner Energy Better Life

DECEMBER 2023 - ISSUE 204

EGYPT UPDATES

TOP 5 Shell Egypt has announced a new discovery after successfully completing the drilling of the first well in its three-well exploration campaign, Mina West, located in the Northeast El-Amriya block, in the Mediterranean Sea. The company said in a statement that drilling activities took place at a water depth of around 250 meters below sea level in the offshore Nile Delta and the primary data confirmed the presence of a gas-bearing reservoir.

It explained that acquired data requires more evaluation to determine the size and recoverable potential of the discovery. It should be noted that Shell signed a Farm Out Agreement (FOA) with Kuwait Foreign Petroleum Exploration Company (KUFPEC) last September, under which KUFPEC acquired a 40% stake in Northeast El-Amriya block, with Shell holding the remaining 60% stake of the partner’s share with the Egyptian Natural Gas Holding Company (EGAS).

Wintershall Dea Announces First Natural Gas Production at East Damanhur Wintershall Dea has announced that together with its partners that it achieved first natural gas production from its ED2-X well at East Damanhur block in the onshore Nile Delta. The well secures production of around 10 million standard cubic feet per day (MMscf/d) of gas and it is successfully tied-back to the nearby infrastructure in Disouq. According to the statement, the licensees, operator Wintershall Dea

(40%) and partners Cheiron Energy (40%) and INA (20%), as well as the Egyptian Gas Holding Company (EGAS), started exploring at East Damanhur in 2021 and announced a gas discovery in the ED-2X ST1 well in January 2023. The ED-2X ST1 well is located about three kilometers from the Disouq field, where Wintershall Dea and EGAS are producing natural gas in the DISOUCO joint venture.

Energean Announces Positive Trading Update in 2023 Energean Energy company has announced positive trading updates on November 16, including developments of its drilling program in Egypt. The company has commenced drilling of the Orion 1x well in Egypt, where it has signed a farm-out agreement that will reduce its net exposure and enhance its returns.

The company’s overall production reached 150,000 barrels of oil equivalent per day (boe/d) in the past few days. Moreover, Energean delivered more than $1 billion in revenues, while the adjusted EBITDAX recorded $623 million in the nine months up to 30 September 2023.

Egypt, IEA Join Forces to Accelerate Implementation of Low Carbon Emissions Projects Minister of Petroleum and Mineral Resources Tarek El Molla has signed a program with the Executive Director of the International Energy Agency (IEA) Fatih Birol to work together in supporting the transition to a low carbon economy in Egypt and diversify the energy mix through production from renewable resources.

data analysis capabilities and the sustainability of data provision in the energy sector. It also includes improving energy efficiency, carbon reduction, and studying the impact of climate change on the energy sector. Additionally, both sides agreed to give priority to training and capacity building programs.

The program includes six primary fields which are preparing models and supporting carbon removal programs and plans, efforts to expand the production of renewable energy and hydrogen and supporting statistical

El Molla referred to the necessity of cooperation between the Egyptian government and IEA in the emissions reduction and acceleration of producing from new and renewable resources and hydrogen.

The Introduction of the CLIMATECH Challenge at the Seventh Edition of Egypt Energy Show (EGYPES) Demonstrating a firm commitment to Egypt’s Nationally Determined Contributions and its ambitious target of reducing greenhouse gas emissions by 65% by 2030, the Egyptian Ministry of Petroleum and Mineral Resources announces the launch of the region’s first CLIMATECH Challenge at the seventh edition of the Egypt Energy Show (EGYPES), taking place in Cairo from 19-21 February 2024. The CLIMATECH Challenge serves as a global platform for start-ups to pitch their technological solutions and business models before a panel

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of influential selection committee members, spotlighting pioneering start-ups with cutting-edge solutions to expedite the energy transition and amplify the role of undiscovered energy innovators in advancing global net-zero targets. Featuring a rich program of keynote speeches, motivational talks, and panel discussions, the CLIMATECH Challenge will gather global energy industry visionaries, investors, changemakers, and emerging start-ups to showcase their critical innovations and groundbreaking climate technologies.

A BLAST FROM THE PAST

In December 2016, a landmark agreement was reached in the oil market with the signing of the Declaration of Cooperation (DoC) between OPEC members and 10 non-OPEC oil-producing countries. This unprecedented collaboration aimed to stabilize the oil market by regulating production levels and addressing the global oil glut that had caused prices to plummet. The DoC marked a turning point for the oil industry, fostering greater cooperation between major oil-producing nations and ushering in a period of relative stability in the market. Addressing the press conference following the momentous meeting, Mohammed bin Saleh Al-Sada, then President of the OPEC Conference and Qatar's Minister of Energy and Industry, emphasized the collective responsibility that spurred the agreement: "The agreement has really stemmed from the sense of responsibility toward the rebalancing of the international oil market which will lead to positive results, not only for producers and exporters but also for the consumers and to the health of the world economy, which we all require." The DoC's initial six-month term was extended multiple times due to its remarkable success in stabilizing the oil market. In recognition of the agreement's effectiveness, a Charter of Cooperation was endorsed during the 6th OPEC and non-OPEC Ministerial Meeting in July 2019. The Charter further solidified the framework for cooperation, establishing a platform for dialogue and exchange of views regarding conditions and developments in the global oil and energy markets. The DoC's resilience was put to the test during the COVID-19 pandemic, which caused an unprecedented demand destruction in the oil market. In response, participating countries swiftly adjusted production down nearly five times more than the initial DoC agreement, reaching a staggering 9.7 million barrels per day (b/d) in April 2020. This marked the largest and deepest production adjustment in the history of the oil market, demonstrating the DoC's flexibility and adaptability in the face of unforeseen challenges.

28% NUMBER OF THE MONTH

Shell Egypt Makes New Discovery in Northeast El-Amriya Block in the Mediterranean

Oil & Gas Sector's Share from Total FDI Inflows into Egypt in Q4 2022/23 Egypt's oil and gas sector received approximately 28% of the country’s foreign direct investment (FDI) inflows during the fourth quarter (Q4) of the fiscal year (FY) 2022/23. The oil and gas sector received FDI inflows of about $1.412 billion, with total FDI inflows into Egypt of $5.036 billion during Q4. The sector’s FDI outflows were about $1.470 billion during this period, according to the Central Bank of Egypt (CBE).

The Egyptian oil and gas sector attracts international oil companies and foreign investors’ attention to invest in Egypt. This came in line with the Egyptian government’s vision to improve the competitiveness of the Egyptian economy, by reforming and improving the regulatory framework and institutions affecting the investment environment. This is in addition to benefiting from successful international practices and policies to strengthen and reform the Egyptian investment system.

EGYPT OIL & GAS NEWSPAPER

DECEMBER 2023 - ISSUE 204

EGYPT UPDATES

PRODUCTION

EVENTS

APEX Announces Operational Updates for Concessions in Egypt Apex International Energy has provided an update on operations from the six concessions in the Western Desert oil producing region of Egypt acquired from IEOC Production B.V. (IEOC), a unit of Eni S.p.A., in the first half of 2023. As of July 1, 2023, Apex’s organically developed working interest production in Southeast Meleiha (SEM) stood at 7,100 barrels per day, and the incremental working interest production added by the acquired assets stood at 2,900 barrels per day (bbl/d), giving Apex a combined working interest production in the Western Desert of 10,000 bbl/d. In July 2023, Apex launched a 32-well workover and well repair program in the Aghar, Raml, Faras and Zarif fields. This program encompasses recompletions and returning the wells to production and has to date resulted in a 1,000 bbl/d increase in oil

production to 3,900 bbl/d, an increase of 34%. In September 2023, Apex commenced reporting its first natural gas production with the startup of the Faramid gas project in IEOC-operated East Obaiyed, in which Apex has a 25% interest. Gas production is currently 24.4 million cubic feet per day, or 4,000 barrels of oil equivalent per day (boe/d), of which 1,000 boe/d is attributable to Apex. In total, Apex’s working interest production is now 11,100 boe/d, which includes 4,800 boe/d from the acquired assets. This places Apex among the top 10 liquids producers in Egypt and top 10 among all producers in the Western Desert. From the commencement of production from SEM in August 2021 to present, including the acquired assets, Apex has achieved an overall 203% annualized CAGR in working interest production.

UOG Average Production in Egypt Reaches 1,024 boe/d in 2023 United Oil & Gas Plc (UOG) working interest production in Egypt averaged 1,024 barrels of oil equivalent per day (boe/d). This was divided into 946 barrels of oil per day (b/d) and 78 boe/d gas, for the year to 5 November 2023.

Kuwait Energy Egypt Company (KEC), as the operator of the Abu Sennan license, informed the Joint Venture (JV) partners that drilling of the ASD S-1X exploration well is expected to start in the coming days, using the ECDC-6 rig.

This comes in line with the group’s full-year 2023 output guidance, which is between 930 and 1,030 boe/d. The full-year guidance includes production from the current wells and contributions from workover activity currently being undertaken in the fields.

The ASD S-1X well is the final well of the 2023 drilling campaign and is targeting an un-risked STOIIP estimated by United at c. 10 million barrels gross across multiple reservoirs intervals, including the primary Abu Roash-C and Abu Roash-E intervals.

Egypt, CIEG Sign Two Energy MoUs

The two agreements were signed by Liu Zhiqiang, Chairman of CIEG, and Abed Ezz El Regal, Chairman of the Abu Qir Fertilizers

and Chemical Industries Company, and Alaa El Batal, EGPC’s Chairman. The first MoU includes enhancing cooperation in establishing a joint project to produce green hydrogen at the North Abu Qir Agricultural Nutrients Company. The second MoU includes examining opportunities to deepen the benefit of renewable energies in various oil and gas sites in Egypt.

Huawei Technologies Egypt Strengthens Ties with Oil and Gas Sector through Cooperative Agreements Minister of Petroleum and Mineral Resources, Tarek El Molla, and Terry He, President of Huawei International for the North Africa Region, witnessed the signing of 3 cooperation agreements and memoranda of understanding (MoUs) between the petroleum sector and Huawei Technologies Egypt. The first agreement was signed by Alaa Hagar, Undersecretary for the Ministry’s Technical Office – Ministry of Petroleum & Mineral Resources; and Jim Liu, CEO of Huawei Egypt. The agreement aims to launch cooperation between the Ministry and the company to implement on-the-job training programs and develop the skills of human cadres selected through the program for qualifying young and medium leadership in the Oil and gas sector.

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Both interactive and educational, Halliburton’s Unconventional Reservoir Workshop, which kicked off at the JW Marriott, offered Egypt’s energy industry professionals interesting insights into exploring the potential of the nation’s unconventional reservoirs, a key asset that can boost the country’s production. This was clearly outlined in a written statement by the company’s North Africa Vice President Ahmed Helmy stated that Egypt’s unconventional reservoirs present unique and formidable challenges, necessitating specialized extraction techniques. He further noted that the reservoirs encompass ultra-tight formations, exhibit intricate geology, high heterogeneity, and low permeability, rendering their development considerably more complex than their conventional counterparts. Nonetheless, Egypt’s unconventional reservoirs hold immense untapped potential. Collaborative efforts and innovative technologies are essential to fully harness this potential.

DOWNSTREAM

AGREEMENTS

Minister of Petroleum and Mineral Resources Tarek El Molla and Hailiang Song, Chairman of the China Energy Engineering Corporation (CEEC), witnessed the signing of two memoranda of understanding (MoUs) between China International Energy Group (CIEG), the Egyptian General Petroleum Corporation (EGPC), and the North Abu Qir for Agricultural Nutrients Company.

Halliburton’s Unconventional Reservoir Workshop: An Unconventional Learning Experience to Boost Hydrocarbon Production in Egypt

The second Memorandum of Understanding was signed by Alaa Al-Batal, CEO of EGPC, and Joey Deng Head of the Digital power Business unit at Huawei Egypt. It outlines the shared vision of providing smart solutions and data centers for oil and gas facilities. By leveraging Huawei’s expertise in digitalization and cutting-edge technologies, this collaboration aims to enhance operational efficiency and optimize resource utilization within the sector. The third MOU focuses on harnessing solar energy solutions within the petroleum sector. Alaa Al-Batal, CEO of EGPC, and Joey Deng Head of the Digital Power Business unit at Huawei Egypt, are the signatories of this agreement. The MOU highlights the intention to implement solar energy solutions and storage batteries to power wellheads at production sites.

Gastec Signs Contracts to Establish New Two Gas Stations in Qalyubia Gastec Chairman Abdel Fattah Farahat has signed two contracts with the General Secretary of Qalyubia Governorate Ihab Serag El-Din to establish new two natural gas stations and liquid fuels in Qalyubia. One of the stations will serve those coming from Al-Qanater Al-Khairiya and Menoufia to Al-Hadtha Bridge and the city of Qalyoub, with a capacity of supply about 500 cars per day with natural gas. While the second station will be an integrated station which will supply the cars coming from Shubra Al-Kheima and from the Cairo-Alexandria Agricultural Road to the Nile Corniche with a capacity of about 700 cars per day. This station will also provide liquid fuel products of various types, in addition to other services provided to citizens. This protocol comes as part of the presidential initiative to expand the construction and operation of more natural gas stations to cover all the Egyptian governorates, Abdul Hamid Al-Hagan, Governor of Qalyubia said. Gastec aims to implement an expanded plan to open and operate many natural gas stations in the various governorates as part of the Ministry of Petroleum and Mineral Resources’ strategy of using natural gas as clean and sustainable fuel. It targets to establish 350 stations in 26 governorates.

EGYPT OIL & GAS NEWSPAPER

FOLLOW UP

MINING

Petroleum Minister, Capricorn Review Western Desert Exploration Potential Minister of Petroleum and Mineral Resources Tarek El Molla has met with Randy Neely, CEO of Capricorn Energy, and Eleanor Rowley, Managing Director of Capricorn Energy Egypt. The meeting discussed the company’s activities in Egypt during the past period and its future plans in its concession areas in the Western Desert, especially since there are promising oil possibilities for research in the

deep layers that have achieved success for other companies in the region.

El Molla stated that these contributions are an essential part of the Ministry’s strategy and represent one of the basic pillars for achieving and implementing the sustainable development plan within the framework

Additionally, the meeting discussed water injection projects to increase pressure in reservoirs with the aim of increasing production.

of Egypt Vision 2030 in its economic, environmental, and social dimensions. This came as he chaired the meeting of the Supreme Committee for Corporate Social Responsibility (CSR) to follow up on the implementation of social responsibility plans and projects. During the meeting, the Minister reviewed the most important projects being implemented in the areas of community service in the various governorates of Egypt and the scope of work of the sector’s companies, explaining that a social department responsibility has been assigned to each company.

National Green Hydrogen Council Approves Green Hydrogen Strategy Prime Minister Mostafa Madbouly has approved the national strategy for green hydrogen during his meeting with the National Green Hydrogen Council’s members to follow up on the latest development of this vital sector.

Fertiglobe company has successfully exported the first cargo of ammonia in the world from its facilities in Egypt using the hydrogen manufactured in the experimental electrolyser of the company’s project in Egypt to produce green hydrogen.

Ahmed Mahina, Head of the Strategic Planning and Performance Monitoring sector at the Ministry of Electricity and Renewable Energy, expressed that the strategy has the objective of positioning Egypt’s contribution in the global hydrogen market at a notable 5-8%. He added that it targets to achieve energy security, carbon emissions reduction by million tons per year by 2040 and increase the gross domestic product by $10 to $18 billion by 2040.

He added that Fertiglobe announced that this shipment had been delivered to Tuticorin Chemicals and Fertilizers Limited (TFL) in India, and it would be used to produce soda ash for Hindustan Unilever (HUL) in India, a subsidiary of the Unilever group.

On the same context, The Chairman of the Suez Canal Economic Zone (SCZone), Waleed Gamal Eldin, announced that

Also, Gamal Eldin pointed out that the Fertiglobe project, located in the Suez Canal Economic Zone, will be able to produce 15,000 tons per year of green hydrogen as a primary raw material used to produce up to 90,000 tons per year of ammonia based on renewable energy sources.

GASCO’s GA Approves Authorized Paid-up Capital Increase Minister of Petroleum and Mineral Resources, Tarek El Molla, attended the extraordinary general assembly meeting of the Egyptian Natural Gas Company (GASCO). The company’s general assembly approved an increase in the authorized, issued, and paid-up capital, and amended Article 3 of the company’s bylaws to add activities related to hydrogen, and the separation and transfer of carbon dioxide, to the activity of the company responsible for activities related to the management and operation of the national natural gas network. During the meeting, GASCO’s Chairman, Yasser Salah El-Ddioxide and the amendments to the articles of the company’s bylaws, which include increasing the licensed capital from $325 million to $500 million, as well as adding the activities of establishing, manufacturing, operating,

El Molla Reviews Progress of Establishment of Mining Digital Portal

The meeting further reviewed production from unconventional sources of gas and shale oil using specialized technologies in this field.

El Molla Chairs CSR Supreme Committee Meeting Minister of Petroleum and Mineral Resources Tarek El Molla confirmed that the petroleum sector strategy attaches utmost importance to social responsibility with the aim of achieving sustainability through cooperation between the sector’s companies and its partners in performing its social role to improve the quality of living conditions of Egyptian society.

maintaining, managing, and owning facilities, lines, facilities, equipment, and devices necessary for the production, storage, transportation, distribution, sale, purchase, export, and import of hydrogen, as well as the separation and transportation of carbon dioxide, and carrying out all works and services related to the company’s activity. Salah El-Din also reviewed the executive status of a number of new projects being implemented, most notably the expansion of the gas compressor station in the Dahshur area 5 and 6, at an investment cost of $190 million, which aims to increase the quantities of natural gas transported to southern Egypt to meet the growing needs in the domestic, industrial, and electricity sectors and the new ANOPC complex for producing diesel in Assiut.

Minister of Petroleum and Mineral Resources, Tarek El Molla, confirmed that the establishment of the first digital portal of its kind for investment in the mining sector represents a qualitative leap in attracting investments to this sector and implementing complete digital transformation. The digital portal aims to market investment opportunities in the search and exploitation of mining ores in a flexible and rapid manner, which works to attract investors more broadly from all over the world after informing them digitally about investment opportunities and submitting investment offers in Egyptian mining areas through the special bids scheduled to be presented to them. The digital portal, after its launch, aims to facilitate and speed up investment decision-making, along the lines of models applied in leading countries in the field of mining, such as Australia and Canada. During the meeting, the Minister followed up with the project work team, which includes the alliance of companies Trimble; MSA; New Smart; and EMRA, the implementation progress, the ongoing steps, and the targeted work plan for the coming period to complete the implementation stages. Similar models efficiently implemented by Trimble around the world were also reviewed. El Molla directed the need to pay attention to training EMRA employees and the cadres that will operate the platform to deal efficiently with the new digital portal and keep pace with continuous updates and development in this field.

ECMR to Increase Capital to EGP 750 M The Egyptian Company for Mining Resources (ECMR) held a general assembly to approve the business results for the fiscal year 2022/23, and to increase the company’s capital from EGP 250 million to EGP 750 million. During the assembly, the company’s chairman, Hany Mostafa, reviewed the most important business results achieved during the year, as he explained that the company was able to increase its production capabilities of mineral ores, most notably phosphate ore, producing approximately 660,000 tons from the mines of Wadi AshShaghoub and Wadi Sharawna Marine in Aswan Governorate, and the mines of Wadi Al-Qarya in Qena Governorate. Meanwhile, Manganese production reached about 6,000 tons from the Abu Shaar mine in the Red Sea Governorate During the last quarter of the year alone, the company was able to produce about 17,500 tons of sandy kaolin ore from the Bir Al-Duhli mine in the Red Sea Governorate, and about 2,000 tons of quartz and talc from the Wadi Atallah mine.

DECEMBER 2023 - ISSUE 204

CORPORATE NEWS

ARAMCO SAUDI ARAMCO DISCOVERS NEW NATURAL GAS FIELDS Saudi Aramco, the world’s largest oil producer, has discovered the presence of two new natural gas fields, Al-Hiran and Al-Mahakik, in the Empty Quarter region, Saudi energy minister Prince Abdulaziz bin Salman said. The Al-Hiran gas field has been confirmed after gas flowed at a rate of 30 million standard cubic feet per day (mscf/d), accompanied by 1,600

barrels of condensate daily. Similarly, the AlMahakik gas field has been confirmed after gas flowed at a rate of 0.85 million standard cubic feet (mscf). Saudi Aramco has set ambitious goals to increase its gas production by 50% by 2030, compared to 2021 levels.

In September, Aramco announced its agreement to acquire a strategic minority stake in MidOcean Energy, a liquefied natural gas (LNG) company, for $500 million, with an option to increase the stake as part of its push into natural gas.

ADNOC ADNOC, SANTOS TO DEVELOP GLOBAL CCS PLATFORM ADNOC and Australian oil and gas firm Santos Limited announced a strategic collaboration agreement (SCA) that paves the way for the potential development of a joint global carbon management platform. This platform aims to support the decarbonization efforts of customers across the Asia-Pacific region. The agreement also highlights the companies’ commitment to advancing carbon capture and storage (CCS) technologies, which are crucial for

accelerating the decarbonization of industries worldwide. Additionally, ADNOC and Santos will explore the establishment of a carbon dioxide (CO2) shipping and transportation infrastructure network to facilitate the capture, shipping, and permanent storage of CO2 from heavy-emitting sectors.

tons of CO2 per year. The company has recently announced significant carbon capture projects in the Middle East and North Africa region, including the Habshan facilities and the Hail and Ghasha offshore developments. These projects, along with ADNOC’s other commitments, bring its total investment in carbon capture capacity to nearly 4 mtpa.

ADNOC currently operates the Al Reyadah facility, which has the capacity to process 800,000

BP BP STARTS PRODUCTION FROM SEAGULL OIL, GAS FIELD IN UK NORTH SEA BP has announced the start of production at the Seagull oil and gas field in the UK North Sea, boosting energy supplies along with supporting the supply chain and jobs in the region. The Seagull field is a subsea tieback to the bpoperated central processing facility (CPF) of the Eastern Trough Area Project (ETAP) in the central

North Sea, located approximately 140 miles east of Aberdeen. The Seagull field has been developed by Neptune Energy and is the first tieback to the ETAP hub in 20 years. It is located 10 miles south of the ETAP CPF and consists of four wells.

At peak production, the Seagull field is expected to produce around 50,000 barrels of oil equivalent gross per day. The oil produced from the Seagull field is exported through the Forties Pipeline System to Grangemouth in central Scotland, while the gas is transported to Teesside via the Central Area Transmission System.

ENI ENI SIGNS NEW LNG SALES AGREEMENT FROM INDONESIA Eni announced that it signed a new LNG sales and purchase agreement with Merakes LNG Sellers, according to a press release from the company. The agreement, worth 0.8 billion cubic meters (bcm), will commence in January 2024 and last for a period of three years. This deal comes in addition to Eni’s existing contract with Jangkrik

LNG Sellers for 1.4 billion cubic meters per year, which has been in place since 2017. According to Eni’ press release, the deal ensures greater flexibility and further diversification of its LNG supplies. It also strengthens the company’s presence in growing markets, particularly in South Asia and the Far East.

Besides the agreement with Merakes LNG Sellers, Eni has also signed a long-term contract with the Marine XII JV in Congo for LNG volumes of approximately 4.5 bcm. Furthermore, Eni has entered into a contract with QatarEnergy LNG NFE (5) for up to 1.5 bcm of LNG from the North Field East project.

EXXONMOBIL EXXONMOBIL STARTS PRODUCTION AT 3RD OFFSHORE GUYANA PROJECT ExxonMobil has announced the start of production at Payara, Guyana’s third offshore oil development on the Stabroek Block.

schedule, and is expected to add 220,000 barrels per day (bbl/d) of oil over the first half of next year as new wells come online.

This new project brings the total production capacity in Guyana to approximately 620,000 barrels per day. The company’s floating production, storage, and offloading (FPSO) vessel, named Prosperity, has started ahead of

This additional capacity is a significant milestone towards achieving a combined production capacity of over 1.2 million bbl/d on the Stabroek Block by 2027.

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The FPSO is the third production facility in the block, following the two serving Liza Phase I and Liza Phase II. It was constructed in China and Singapore and arrived in Guyana in April 2023. It is moored at a water depth of about 1,930 meters.

EGYPT OIL & GAS NEWSPAPER

EQUINOR EQUINOR ANNOUNCES GAS DISCOVERY IN THE NORTH SEA Equinor, an international energy company headquartered in Norway, has announced a gas discovery near the Gina Krog field in the North Sea with an estimated recoverable volume between 5 and 16 barrels of oil equivalent (boe). Considered as the first commercial discovery in the Gina Krog license since 2011, gas production

is expected to start production during the fourth quarter of 2023. The well was drilled by the Noble Lloyd Noble rig, with Equinor acting as the operator holding 58.7% and KUFPEC and PGNiG as partners holding 30% and 11.3% stakes, respectively.

One of the key factors contributing to the commercial viability of this discovery is the ability to utilize existing infrastructure provided by the Gina Krog platform. Preparations have already been made on the Gina Krog platform to ensure a smooth and efficient start of production, as Equinor stated in a press release.

EDISON EDISON RECORDS RISE IN NET INCOME IN Q3 2023 Edison International announced its third-quarter net income of $155 million, or $0.40 per share, compared to a net loss of $128 million, or $0.33 per share, in the third quarter of last year. Meanwhile, as adjusted, third-quarter core earnings were $531 million, or $1.38 per share,

compared to core earnings of $564 million, or $1.48 per share, in the third quarter of last year. Southern California Edison (SCE), a subsidiary of Edison International, experienced a decrease in third-quarter core earnings per share due to higher interest expense and a turn-up related to the Customer Service Re-Platform decision.

However, SCE has made progress in reducing its risk of losses from catastrophic wildfires by 85% since 2018. Edison International Parent and Other’s thirdquarter core loss per share increased year over year, primarily due to higher interest expenses.

PETROCHINA PETROCHINA RECORDS HIGH NET PROFIT IN Q3 2023 PetroChina, the largest oil and gas company in Asia, announced a 21% year-on-year increase in net profit for the third quarter of 2023. The company’s net profit reached a record high of 46.38 billion yuan ($6.3 billion), driven by increased production and improving domestic fuel demand.

While PetroChina’s net profit soared, its revenue fell by 4.6% to 802 billion yuan. This decline can be attributed to lower realized oil and gas prices. PetroChina’s crude oil output between January and September rose by 4.3% compared to the previous year, reaching 706 million barrels. This growth includes a significant increase of 22% in overseas production, totaling 122 million barrels.

Additionally, natural gas output increased by 6.1% to 3,656.6 billion cubic feet. Despite its strong performance, PetroChina faced challenges in oil and gas prices. The company reported a realized oil price of $75.30 per barrel during the nine-month period, representing a 21% decrease compared to the previous year, as global oil prices fell following a spike prompted by Russia’s invasion of Ukraine.

BAKER HUGHES BAKER HUGHES ACHIEVES $6.6B IN REVENUES IN Q3 2023 Baker Hughes has announced that it has achieved revenues of $6.6 billion in Q3 2023, up 24% yearover-year (YoY). Baker Hughes reported net income of $518 million for the quarter, up $534 million YoY, in addition to adjusted net income (a non-GAAP measure) of $427 million for the quarter, up $163 million YoY.

Additionally, the Houston-based company reported adjusted EBITDA (a non-GAAP measure) of $983 million for the quarter, up 30% YoY. Baker Hughes also delivered strong operating results at the upper end of the company’s EBITDA* guidance range, booked almost $100

million of new energy orders, and generated $592 million of free cash flow. Lorenzo Simonelli, Baker Hughes chairman and chief executive officer, emphasized the importance of monitoring the discipline of major oil producers, the pace of oil demand growth in the face of economic uncertainty, and geopolitical risks as key factors for the future.

CNOOC CNOOC REPORTS RECORD CAPITAL SPENDING, LOWER PROFIT IN Q3 2023 CNOOC, China’s offshore oil and gas company, announced its results for the third quarter of 2023, revealing a record level of capital spending and a decrease in profit due to lower oil prices. Despite this, the company achieved better-thanexpected operating results and set new records in oil and gas reserves and production. In the first nine months of 2023, CNOOC achieved a net production of 499.7 million boe, marking

an 8.3% increase compared to the previous year. This is the highest production level recorded for the same period in previous years. The net production from China grew by 6.7% year over year to 345.5 million boe, driven by the production growth of Kenli 6-1 and Lufeng 15-1. Additionally, the net production from overseas increased by 11.8% year over year to 154.1 million

boe, mainly due to the production ramp-up from Liza Phase II in Guyana and Buzios in Brazil. CNOOC has maintained effective control over costs, resulting in a 6.3% year-over-year reduction in all-in costs to $28.37 per boe. The strong growth in production partially offsets the impact of fluctuating international oil prices.

DECEMBER 2023 - ISSUE 204

10 INTERVIEW

20 YEARS OF RESILIENCE AND GROWTH AN INTERVIEW WITH HUSSAM ABU SEIF, REGIONAL VICE PRESIDENT, TAQA Congratulations on TAQA 20th anniversary! What are some of the key milestones and achievements of TAQA in the past 20 years, and what impact have these had on the company's growth and reputation?

TAQA, as the enabler of energy, has aggressively expanded its geographical footprint, technology portfolio and in-house capabilities through strategic acquisitions around the world, creating an international brand presence. fully acquired companies in Canada, the United States, Saudi Arabia, Norway, the United Kingdom, and the United Arab Emirates. Those acquisitions helped grow the portfolio of offering leading well solutions primarily focused on technology differentiation, agile offerings, and fit-to-purpose solutions. Can you tell us about the role TAQA has played in supporting the Saudi Vision 2030 and the kingdom's diversification efforts?

Headquartered in Dhahran and Abu Dhabi, TAQA now employs more than 5,000 people from 76 nationalities in 20 countries and serves multiple markets with 3 centers of excellence. TAQA is an international company offering leading well solutions that support the Kingdom's vision by localizing the oil & gas sector and developing local companies into regional and global leaders. Moreover driven from Saudi Arabia’s Vision 2030, Saudi Green Initiative and the Carbon Circular Economy Framework, the TAQA decarbonization roadmap will capitalize and prove the success of multi-sector collaboration. Clean industrial hubs as a mean stands to deliver efficiencies, savings as well as being role models to drive innovation and new government, academic and private sector

❝ Innovation is in our core business strategy and we keep investing in unique technologies that will support the reduction of our carbon footprint. ❞

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partnership models. Innovation is in our core business strategy and we keep investing in unique technologies that will support the reduction of our carbon footprint. How has TAQA contributed to the growth and development of the Egyptian market? Can you highlight any significant projects or investments in Egypt?

Our strategic expansion specifically in upstream involves harnessing the unparalleled capabilities offered to our operators in Egypt to provide one of the most comprehensive portfolios of services. This collaborative attempt marks a significant milestone for the entire upstream Oil & Gas sector. It symbolizes innovation, efficiency, and sustainable growth, paving the way for a future marked by progress. Complemented by integrating past and recent acquisitions, we are equipped to drive sustainable growth in the region , serving our clients better and supporting the overall well-established energy sector. Complete well solutions portfolio includes Coiled Tubing and Stimulation, Cementing, Wireline, Frac, Directional Drilling, Downhole Tools, Completions, Well Testing, Slickline, Inspection, and H2S & Safety. Including a wellestablished Seismic business in Egypt and recently looking at prospects in Geothermal energy transition creating potential and vast opportunities offered to our customers in Egypt. We are investing in Egypt to be the hub for Africa. Egypt is well positioned to facilitate serving other African countries from a manufacturing and talent perspective. We will highly rely on localized resources. We started by forming an alliance with Petrojet last month to identify and seize opportunities in various aspects of oilfield development in Africa and the Middle East, including early production facilities, engineering, fabrication, and manufacturing of equipment. TAQA has made several significant acquisitions in recent years. Can you shed light on the strategic importance of these acquisitions and how they align with TAQA's long-term goals and vision?

With global, technology-focused acquisitions integrated into a single company and significant in-house R&D capacity, TAQA is a well-established world leader offering well solutions and providing a complete and unique full-service portfolio, creating a compelling competitive advantage over the world’s current industry leaders. This is complemented with a strong technology

EGYPT OIL & GAS NEWSPAPER

portfolio alongside Inhouse R&D and engineering capacity to develop proprietary tools and bundled solutions. What makes TAQA unique when you compare it to other energy companies in the Middle East?

We differentiate ourselves through digital and innovation technologies and solutions. Closely interconnected to customers, creating unique understanding of their requirements and potential for close working relationships. We are a young organization with an efficient hierarchy and high standards of corporate governance. With the changing global energy landscape, what opportunities and challenges do you foresee for TAQA in the coming years, and how do you plan to address them?

Infrastructure and local demand for energy including alternative energy prospects are the main challenges in the region. Committed to developing transactional relationships into partnerships, access to an enhanced technology portfolio and a more diverse pool of talent are key in addressing such challenges. As we embark on this new phase of expansion across Egypt, a

❝ Egypt is well positioned to facilitate serving other African countries from a manufacturing and talent perspective. We will highly rely on localized resources.❞

nation that stands as a regional hub and a robust gateway for expansion into the Middle East and Africa, I am truly optimistic and looking forward to being part of the transformative journey that lies ahead. Looking ahead, what are the key priorities and objectives for TAQA in the next 5 to 10 years? How do you envision the company's role evolving within the energy industry, both in the region and globally?

At TAQA, we have set our values to serve our key objectives throughout our journey. We put our customers, shareholders, and people at the center of everything we do. We’re ambitious and fearless in our pursuit of new market opportunities, bold product innovations, and transformative partnerships. We are an agile, forward-thinking force for evolution. We create innovative solutions to advance the energy sector and respond to industry changes and demands with dynamism. How does TAQA contribute to the local communities and societies in which it operates?

Our commitment is not merely numerical. With this expansion, TAQA’s workforce will grow to over 5,000 employees, dedicated to serving a diverse customer base across 20 countries. This growth is not just a testament to our success but also a reflection of the trust our partners and customers place in us. As we step into this new chapter, there are plenty of obligations towards our societies and communities and we will investigate those meaningful opportunities that will have a positive impact on such needs. We all need to collaborate to fuel not just the energy sector but also to empower communities, foster innovation, and create a sustainable future for all. We are committed to building a legacy that generations will look back upon with admiration and gratitude.

DECEMBER 2023 - ISSUE 204

12 RESEARCH & ANALYSIS

EGYPT’S NATURAL GAS PIPELINES TOWARDS A REGIONAL TRANSIT HUB BY JOLLY MONSEF, MARIAM AHMED & ABDULLAH MOSTAFA

Egypt spares no efforts to avail natural gas as a transitional fuel; it has become a strategic priority in the energy transition. Natural Gas pipelines are a prerequisite for the deployment and maximization of the use of natural gas to cope with Egypt's ambitious economic and social development plans. In this regard, Egypt takes advantage of its

Flashbacks

extensive natural gas pipeline network all over the country to transport natural gas from areas of production to midstream and exporting points. Furthermore, Egypt strives to deliver its natural gas to the global market,

Egypt emphasized the importance of pipelines in

especially after achieving self-sufficiency.

transporting natural gas, both domestically and

Hence, Egypt has put a great deal of interest in developing its pipeline

internationally. In 2000, Egypt took a significant

infrastructure to allow exports, and adding more pipelines to connect

step forward by signing a memorandum of

to other countries, especially those in the Mediterranean region. This

understanding (MoU) with Syria, to which Jordan

is in addition to exploiting its two gas liquefaction plants in Idku and

became included in 2001, to establish the first

Damietta, from which it exports liquified natural gas (LNG) to global

natural gas export pipeline, according to the

markets.

Ministry of Petroleum and Mineral Resources

This report gives an overview of Egypt's natural gas pipelines connecting

(MoPMR). This pipeline, known as the Arab Gas

producing regions and midstream plants, and the pipelines connecting

Pipeline (AGP), which started in 2003, according

the Egyptian market to the Eastern Mediterranean countries, focusing on

to the Egyptian Natural Gas Holding Company

pipelines' features and destinations.

(EGAS).

NATIONAL PIPELINES OVERVIEW 1. Gulf of Suez/Sinai There are seven natural gas pipelines linking the Gulf of Suez to

Ras Bakr Transmission Station and Korimat Power Station. The pipeline

Sinai, with a total capacity of about 835.8 million cubic feet per day

linking Suez and Port Said has the largest pipeline capacity in the Gulf

(mmcf/d); two of which (Trans Gulf Gas and Zaafarana-Korimat

of Suez and Sinai, transporting about 230.3 mmcf/d, according to

pipelines) transport natural gas to be pumped in two stations:

Wood Mackenzie.

Pipeline

From

Length

(Km)

Capacity (mmcf/d)

Trans Gulf Gas

Petreco Plant

Ras Bakr Transmission Station

110

Zaafarana-Korimat

Zaafarana

Korimat Power Station

163

105

Zeit Bay-Ras Shukheir

Zeit Bay (Pre-2017)

Ras Shukheir

140

Ras Shukheir-Suez Gas Trunkline

Ras Shukheir

Suez

245

160

Cairo Ring

150

90.5

Port Said

160

230.3

El Arish Power Station

185

Suez-Cairo Ring Suez Suez-Port Said El Arish Gas Pipeline

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Port Said

EGYPT OIL & GAS NEWSPAPER

2. Nile Delta/Cairo/Nile Valley The Nile Delta, Cairo, and the Nile Valley are connected by 10 pipelines

and about 2,200 mmcf/d natural gas transporting capacity, according

to transport natural gas, with a total length of 612 kilometers (km),

to Wood Mackenzie.

Pipeline

From

Length

(Km)

(mmcf/d)

Cairo

125

800

Damietta

360

Abu Madi-Talkha I

Abu Madi

Talkha Distribution Station

Talkha-Tanta-Cairo

Talkha Distribution Station

Abu Madi-Damietta

Abu Madi

Meadia-Damanhur

Abu Qir Development Area

Abu Madi-Talkha II

Capacity

Damanhur Alexandria Network-Damanhur

Alexandria

Damanhur-Tanta

Damanhur

Tanta

700.1

Cairo Ring-Port Said Line

Cairo Ring

Port Said

130

230.3

Al Tebbin Power Station

110

Beni Suef

Korimat-Al Tebbin

Korimat Power Station

Korimat-Beni Suef

3. Western Desert The Western Desert in Egypt includes a network of multiple natural gas

These seven pipelines have a total capacity of 2,892 mmcf/d. The

pipelines, including seven pipelines linking the Western Desert on one

Tarek-Amerya gas pipeline stands out as the largest among them

side and the Mediterranean Sea and Matrouh on the other, with a total

in terms of length, diameter, and capacity. With a capacity of 950

length of 514 km.

mmcf/d, it spans a length of 231 km and has a diameter of 34 inches, according to Wood Mackenzie.

Pipeline

From

Length

Capacity

(Km)

(mmcf/d)

Tarek-Amerya

Tarek

Amerya

231

950

Obaiyed-Tarek

Obaiyed/ Salam Connector

Tarek

49.5

600

Obaiyed Spurline

Obaiyed

41.5

480

250

Obaiyed/ Salam Connector

Salam Spurline

Salam (Pre-2021)

Qasr-Shams

Qasr (Pre-2021)

Shams (Pre-2021)

350

Shams-Obaiyed

Shams (Pre-2021)

Obaiyed

240

Salam-Matruh Terminal

Salam (Pre-2021)

Matruh

Meanwhile, the Badr El Din and Abu Gharadig in the Western Desert

These pipelines collectively possess a capacity of 667 mmcf/d. The

region comprise a network of four natural gas pipelines with a total

Salam-Abu Gharadig pipeline has the largest capacity of about 187

length of 1,007.13 km and a total diameter of 78 inches.

mmcf/d, according to Wood Mackenzie.

DECEMBER 2023 - ISSUE 204

14 RESEARCH & ANALYSIS

Pipeline

From

Length

(mmcf/d)

267.74

180

267.39

150

Dashour

260

150

Abu Gharadig (Pre-2021)

212

187

Badr El Din-Amerya (1) Badr El Din Fields

Amerya

Abu Gharadig-Dashour (1)

Abu Gharadig (Pre-2021)

Salam-Abu Gharadig

Salam (Pre-2021)

Badr El Din-Amerya (2)

Capacity

(Km)

MAJOR TRADE PIPELINES Arab Gas Pipeline (AGP) AGP is a trans-regional natural gas pipeline that carries natural gas through Egypt, Syria, Jordan, and Lebanon with an ultimate capacity of 10 billion cubic meters per year (bcm/y), according to the Jordanian Ministry of Energy and Mineral Resources. Egypt considers the AGP a remarkable strategic and economic Arab cooperation between Egypt

Starting Year

Operators

Length

2003

EGAS, Enppi, Petrojet, GASCO & SPC

~1,207 km

and other countries.

The pipeline was attacked repeatedly between 2011 and 2018, leading to stoppages of gas exports, but it was brought back later. In 2020, *Last Update in November 2022

the AGP reversed to deliver Israeli natural gas to Jordan's National Electric Power Company at around 300 mmcf/d. Moreover, since 2022,

AGP comprised four construction phases. The first phase of the

Israeli gas has flowed through the pipeline to Egypt to meet growing

project involved a pipeline that carried Egyptian gas to Jordan. This

domestic demand and take advantage of high LNG prices, as stated by

prompted Jordan to start importing LNG at Aqaba in 2015. Exports

Wood Mackenzie.

resumed in 2018 at a rate of 50-100 mmcf/d and in 2019, an agreement was reached to supply an additional 250 mmcf/d on a variable and interruptible basis.

In June 2022, Egypt signed an agreement with Lebanon to supply 23 billion cubic feet per year (bcf/y) of natural gas from Egypt to Lebanon

However, the second phase is operated on a build, own, operate, and

via Syria and Jordan using the Jordanian segment of the AGP, according

transfer (BOOT) basis for 30 years to supply power stations at Rehab

to the US Energy Information Administration (EIA). The agreement’s

and Al Samra, as stated by Wood Mackenzie. The third phase involved

implementation was hindered due to the US Sanctions on Syria.

extending the pipeline to run to the Jordan-Syria borders with initial gas sales estimated at 35.3 bcf/y. Lastly, the fourth phase in which Syria completed AGP to reach the city of Homs, with a diameter of 36 inches.

Starting Date

1st

2nd

3rd

4th

2003

2006

2007

2008

From

El-Arish (Egypt)

Aqaba (Egypt)

El-Rehab (Jordan)

Jordanian-Syrian Borders

Agaba (Jordan)

El-Rehab (Jordan)

Jordanian-Syrian Borders

Homs (Syria)

Length (km)

265

393

342

330

Capacity (mmcf/d)

965

640

100

Estimated Cost ($ million)

250

300-350

400

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EGYPT OIL & GAS NEWSPAPER

Arish-Ashkelon Pipeline The Arish-Ashkelon pipeline, also referred to as the East Mediterranean

The agreement aims to boost LNG sales to EU countries, which are

Gas (EMG) Pipeline, was built in 2008 with the purpose of transporting

seeking to reduce their dependence on Russian gas supplies following

natural gas from Egypt to Israel. It is important to note that this

Russia's invasion of Ukraine, as reported on EMGF website.

pipeline should not be confused with the East Mediterranean Gas (EastMed) pipeline, which is a proposed project intended to deliver

Chevron temporarily ceased its natural gas exports through the EMG

natural gas from the fields in Israel and Cyprus to Greece.

pipeline in early October 2023 due to heightened conflict between Israel and militants in Gaza. To maintain gas exports, Chevron opted

In 2019, a new agreement was reached between Egypt and Israel to

to utilize the FAJR pipeline, connecting Jordan and Egypt. The EMG

reverse the pipeline flows, enabling the delivery of natural gas from

pipeline is crucial for transporting gas from Chevron's Leviathan

Israel's offshore fields to Egypt. This shift in direction marked a change

offshore gas field to Egypt. In response, Israel suspended production

in the pipeline's function and purpose. Gas imports from Israel started

at the Tamar gas field and slightly reduced gas exports from the

in early 2020. Contracted volumes are for 3 tcf to be purchased over a

Leviathan field to prioritize the domestic market.

period up to 15 years, according to the EIA. However, in early November, Israeli natural gas exports to Egypt Within the framework of Israeli natural gas exports to Egypt, in June

have resumed after the temporary disruption, with the current flow

2022, Israel, Egypt, and the European Union (EU) signed a landmark

undisclosed. This resumption is vital for Egypt, which relies on Israeli

agreement during the ministerial meeting of the East Mediterranean

gas imports to meet domestic demand and generate foreign currency

Gas Forum (EMGF) in Cairo. The deal solidified plans for Israel to

through re-exports, Reuters reported.

export its natural gas to the EU through Egypt, marking the first instance of such exports.

ARISH-ASHKELON PIPELINE HIGHLIGHTS

From

Arish

Ashkelon

PIPELINE'S STAKEHOLDERS

61%

39% EMED*

East Mediterranean Gas Company (EMG) Length

Capacity

90 Km

147 - 247 bcf/d

*A joint venture involving Delek Drilling (now NewMed Energy), Nobel Energy (fully acquired by Chevron), and Dolphinus Holdings.

Proposed Nitzana Route In May 2023, a new 65 km onshore gas pipeline from Israel to Egypt

This pipeline increases the possibility of exporting more gas from Israel

was approved. The pipeline would enable the export of an additional

through Egypt to European countries, according to the Israel National

580 mmcf/d of Israeli gas. The pipeline would run from the southern

Digital Agency.

Negev region and the Egyptian grid near Nitzana.

Egypt is strategically advancing its position as a key player in the global oil and gas trade by actively expanding its infrastructure. With a focus on enhancing export capabilities, Egypt is leveraging its natural resources to tap into European markets, particularly in the aftermath of the Russian-Ukrainian war. These efforts aim to attract additional investments, bolster the country's energy sector, and create new avenues for revenue generation. Egypt's dedication to expanding and improving its natural gas pipeline infrastructure demonstrates its commitment to utilizing natural gas to secure its energy needs while embracing environmental sustainability. The country's strategic investments in pipeline development, coupled with its geographical advantage as a regional transit hub, position Egypt for continued success and prominence in the natural gas sector.

DECEMBER 2023 - ISSUE 204

16 OVERVIEW

EGYPT'S ENERGY INFRASTRUCTURE: A CORNERSTONE FOR REGIONAL ENERGY TRADING DOMINANCE BY SARAH SAMIR

gypt's robust oil and gas infrastructure aligns with its ambition to establish itself as a regional energy trading hub. The country's strategic location and substantial resources position it as a promising candidate for this role. This well-developed infrastructure facilitates the export and import of oil and gas, enabling Egypt to participate actively in hydrocarbon trade while serving as a crucial energy transit nation.

Egypt's Oil & Natural Gas Infrastructure Egypt is operating the Suez Canal, a 193km artificial waterway that connects the Red Sea to the Mediterranean Sea, and the Suez-Mediterranean Pipeline (SUMED), a 42-inch pipeline that transports crude oil between the Gulf of Suez and the Mediterranean Sea. These two critical pieces of infrastructure play a vital role in the global transportation of crude oil and liquified natural gas (LNG), connecting energy trading markets in Europe, Asia, and Africa. “Egypt has crude oil storage facilities located at the Ain Sukhna and Sidi Kerir terminals, which are located at the beginning and the end of the SUMED pipeline. The Sidi Kerir terminal, located on the Mediterranean, has 27 storage tanks with a total capacity of 20 million barrels, while the Ain Sukhna terminal (located on the Red Sea) has 15 floating storage tanks with a total capacity of 10 million barrels,” according to Country Analysis published by the Energy Information Administration (EIA) in 2022. This comes as vessels assisting loading and unloading of crude oil tankers at SUMED terminals have been retrofitted recently. "Seven service vessels operating at single point mooring (SPM) terminals of the Sumed Pipeline have new seawater-lubricated bearing systems from Thordon Bearings," as reported by Riviera Maritime in June 2023. Meanwhile, Minister of Petroleum and Mineral Resources, Tarek El Molla, stated in June 2022 that Egypt has a strong infrastructure that can be linked to the gas fields producing in the region, in

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addition to good relations with partners in the Eastern Mediterranean region. El Molla’s comments came as the Egyptian Natural Gas Holding Company (EGAS) signed a memorandum of understanding with Chevron EMed Midstream Ltd., for cooperation in the activities of transporting, importing, liquefying and exporting East Mediterranean gas through Egypt, which supports Egypt’s regional energy hub vision. Meanwhile, Egypt has two liquefaction plants in Damietta and Idku, which help the country export LNG to the European market, as well as import natural gas from neighboring countries to be reexported in the form of LNG to Europe. The two liquefaction plants have the capacity to export 13 million tons per year of LNG, Magdy Galal, Chairman of the Egyptian Natural Gas Holding Company (EGAS), told an energy conference in February. Egypt as a Regional Energy Hub In the past two years, after the Russian military operation in Ukraine, Egypt’s position as a natural gas trading hub was intensified as the country’s LNG exports to Europe increased. Egypt's exports of LNG grew by 14% year-on-year to 7.5 million tons in 2022, as reported by El Ahram Newspaper. This comes as Egypt shipped 80% of its LNG exports to Europe in 2022, according to Reuters. During June 2022, Egypt signed a memorandum of understanding (MoU) with both the European Union (EU) and Israel for regional cooperation related to trade, transport, and export of natural gas to the EU.

As a part of its leading role in the region, in 2018, Egypt had introduced the Initiative to establish the East Mediterranean Gas Forum (EMGF), which is a platform supporting structured dialogue on natural gas and its policies, unlocking the potential for natural gas in the East Mediterranean region. Meanwhile, Egypt has been working on developing ports to boost their oil and gas trading and storage capacity to enable the country’s vision to become a regional hydrocarbon trading hub. Moreover, the Egyptian government has been working on boosting the ports’ role in transit by providing ship fueling services at ports such as the West Port Said port, which witnessed its first successful fueling of a container ship in July 2023, as reported by Al Ahram Newspaper. Egypt boasts a robust energy infrastructure that is poised to propel it to the forefront as a regional oil and gas trading hub. The country's strategic location, coupled with its vast energy resources, makes it an ideal candidate to assume this pivotal role.

Egypt's robust oil and gas infrastructure aligns with its ambition to establish itself as a regional energy trading hub. The country's strategic location and substantial resources position it as a promising candidate for this role.

EGYPT OIL & GAS NEWSPAPER

DECEMBER 2023 - ISSUE 204

18 INDUSTRY INSIGHT

THE TRAILBLAZING TRANSITION: NATURAL GAS & CLEAN ENERGY INFRASTRUCTURE BY RANA EL-KADY

o begin with, oil and gas products are now the primary source of hydrogen creation, and the production of green hydrogen is costly. Hydrogen is known to be a fluid energy carrier, according to the International Energy Agency (IEA), with an extensive variety of uses in industries like transportation and manufacturing.

It is able to be made in several methods. One technique is electrolysis, which involves dividing water into hydrogen and oxygen through an electric current. This method is referred to as green or renewable hydrogen if the energy utilized in it originates from renewable resources like solar or wind power.

General Overview Green hydrogen, which is created by electrolyzing sources of clean energy instead of petroleum or coal, is seen as being crucial to hastening the worldwide green transformation. Green hydrogen is a flexible carrier that may be utilized in numerous capacities such as fuel for vehicles, in contrast to wind or solar electricity. Even though fossil fuels are now used to manufacture the majority of hydrogen, favorable government regulations and increasing demands on energy firms to decarbonize are predicted to cause a surge in the production of green hydrogen in the years to come. Authorities and energy corporations need to be ready for a sharp increase in output over the months to come and make certain they're equipped with the necessary infrastructure for moving green hydrogen, as it becomes an increasingly significant clean energy option. Significant hydrogen corridors have already been established worldwide, such as the European connection between Spain and the Netherlands. It will not be long before Egypt initiates a similar set of procedures to ensure its position as a regional energy hub. Long-term cost and time savings for businesses could result from adopting recent advances in natural gas technology to hydrogen transportation, which would also facilitate the shift from fossil fuels to renewable energy sources.

The Transition Utilizing already-existing pipelines can lower the cost of transporting hydrogen; however, pipelines must be evaluated to determine whether they are suitable for this purpose, taking into consideration factors like deterioration, maintenance, detection of leaks, the impact of hydrogen on pipeline resources as well as consumers, and gas flow measurement. Gas pipelines might be used to carry hydrogen, an idea that is gaining popularity as more governments speed up plans to expand infrastructure and natural gas production. This is evident in the United States, where a multitude of facilities are part of a contentious LNG project pipeline. In addition, Canada is building its first LNG transport facility in response to years of demand from the energy industry. In order to facilitate intermediate energy security while advancing toward a green transition, a number of innovative natural gas facilities are being built. In light of the anticipated sharp increase in the need for green hydrogen during the coming years, numerous businesses worldwide have announced plans to expand their production of the gas during the course of the next ten years. In order to conserve both time and funds later on and to further promote the green transition, energy businesses and governments should take advantage of this chance and construct pipelines that might be utilized for the transportation of both natural gas and green hydrogen.

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The Transition Phase The bulk of hydrogen generated today, globally, comes from steam methane transforming, an established method of producing hydrogen from a methane source, like natural gas, by using high temperatures in the steam. The natural gas revamping procedure discharges a significant amount of carbon into the environment if carbon capture technology is not used. Companies must address the greenhouse gas emissions from this manufacturing route in order to make hydrogen environmentally friendly. For sectors implementing an alternative energy plan these days and creating long-term sustainable alternatives for the next day, this is an essential aspect of the picture. Three stages make up the steam methane transforming method. Firstly, hydrogen, carbon monoxide, and small amounts of carbon dioxide are produced by the reaction of natural gas with steam, pressure, and a catalyst. The steam and carbon monoxide combine with a catalyst in the following stage to produce more hydrogen and carbon dioxide. The carbon dioxide and other impurities are eliminated in the last stage, which produces pure hydrogen. Alternative energy can be implemented in a number of ways as more hydrogen becomes available in the sector. In addition to lowering overall greenhouse gas emissions, the use of blue hydrogen offers a chance to take advantage of important energy and infrastructure resources, such as natural gas pipelines and oil and gas products. In conclusion, the transition to clean and alternative energy sources being implemented into natural gas infrastructure is slowly turning into reality. This goal is not far from being accomplished and will soon be able to blend into a more sustainable future within the industry.

Green hydrogen is a flexible carrier that may be utilized in numerous capacities such as fuel for vehicles, in contrast to wind or solar electricity.

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Advancing Water Stewardship & Circular Economy Initiatives At the forefront of transformation, we empower the industrys shift to cleaner energy with a strong focus on Water Neutrality and Circular Economy.

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DECEMBER 2023 - ISSUE 204

20 TECHNOLOGY

AR REVOLUTIONIZES OIL AND GAS INDUSTRY WITH ENHANCED EFFICIENCY, SAFETY, AND COSTEFFECTIVENESS BY FATMA AHMED

he demand for increased production and global energy security presents an urgent need to substantially develop oil and gas infrastructure. This must be accomplished while maintaining operational efficiency and cost-effectiveness. Innovative solutions, such as augmented reality (AR), have become instrumental in aiding industry operators to address these challenges. Implementation of AR technology in oil and gas infrastructure has proven to optimize performance, enhance safety measures, and ensure cost efficiency.

What AR is and How it Differs from Virtual Reality (VR) AR and VR share a similar concept, but they differ in some ways. Both technologies allow users to visualize objects or environments that may not physically exist in the real world. However, according to an article published by the Council of Petroleum Accountants Societies (Copas), AR distinguishes itself from VR by blending digital elements with the physical world, typically through the use of a headset or tablet. Conversely, VR immerses users entirely into a digital world, cutting off their interaction with the physical environment. For instance, wearing a VR headset can transport users to space and enable them to engage in various activities. The use of AR in the oil and gas industry offers numerous benefits. Throughout different industrial phases, from drilling to pipeline pumping, AR technology can be utilized effectively. An article from the European Business Review suggests that AR can serve as an ideal tool for mapping and surveying drilling sites, providing a comprehensive 3D visualization. This allows for the identification of potential issues, hazards, and collection of data to enhance operational efficiency. When combined with other technologies such as artificial intelligence (AI) and the Internet of Things (IoT), AR has the potential to facilitate the digitalization of the sector. Positive Impact and Applications of AR on Oil & Gas Sector As mentioned above, augmented reality (AR) offers numerous benefits to the oil and gas industry, particularly with regard to its infrastructure. Despite being in its early stages of development, the industry has begun to adopt various applications of this technology.

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According to an article released by VSight, augmented reality (AR) facilitates easy maintenance and repair. This innovative technology allows for quick maintenance and repair works for the machines that need urgent services. This can be done through connecting the machines’ monitors in real-time, so that they can detect any problem quickly. AR headsets also provide technicians with a hands-free solution to complex problems. Technicians can simply wear the headset and receive real-time guidance from remote experts, who can see what the technician sees through the headset's camera. This allows for faster and more efficient repairs, especially for critical equipment. AR technology enables cost reduction by streamlining workflows, providing real-time data for informed decision-making, facilitating rapid troubleshooting, and enabling remote problem-solving. These capabilities empower operators to optimize processes, minimize downtime, and reduce overall costs. AR technology enhances the efficiency and safety of drilling operations by providing real-time 3D visualizations of the drilling site. These visualizations allow operators to remotely monitor the drilling process and identify potential issues, such as broken equipment or leaks, without having to physically be at the site. Additionally, AR can be integrated into smart glasses, enabling workers to perform tasks hands-free, improving safety and reducing the risk of accidents. AR-equipped wearable devices can monitor workers' vital signs, including heart rate, blood pressure, and oxygen levels, alerting them to potential health risks and enabling timely intervention. These devices can also monitor air quality, geolocation, and weather

conditions, providing real-time alerts about potential hazards. AR can provide hands-free, on-demand training sessions, eliminating the need for traditional classroom training and reducing the cost of printed materials like handbooks and manuals. AR can also overlay 3D models and instructions onto the real-world view, guiding workers through complex procedures and ensuring proper execution. AR's ability to improve efficiency and safety directly translates to cost savings. By reducing downtime, minimizing accidents, and streamlining training, AR can significantly lower operational costs. Additionally, AR can enable remote monitoring and troubleshooting, further reducing the need for costly physical visits to drilling sites.

Implementation of AR technology in oil and gas infrastructure has proven to optimize performance, enhance safety measures, and ensure cost efficiency.

By reducing downtime, minimizing accidents, and streamlining training, AR can significantly lower operational costs.

EGYPT OIL & GAS NEWSPAPER

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DECEMBER 2023 - ISSUE 204

22 ENERGY ECONOMICS

LNG HAS TURNED THE TABLES OF ENERGY INFRASTRUCTURE ECONOMICS BY NADER RAMADAN

eing a fairly recent discovery, liquefied natural gas has opened the doors to new possibilities and potentially faster, more secure access to hydrocarbon energy resources. Groomed to be the ideal transitional fuel that will power the world market’s evolution into a global economy that will be largely dependent on renewable energy, LNG has been the impetus behind reform not only when it comes to emissions reduction and climate action, but major infrastructural changes as well. No longer limited by building projects that involve extensive transnational pipelines, LNG has the potential to be frozen and efficiently placed on ships, potentially saving national economies billions that would otherwise have to be invested in transporting natural gas through other more costly methods. The rise in LNG has definitely had a domino effect on the maritime industry by increasing the demand for better and faster shipping methods, thereby significantly boosting the logistics industry and other associated infrastructural projects.

is docked but not yet operational,” said a report titled “Europe’s LNG Capacity Buildout Outpaces Demand” by Lead Energy Analyst Ana Maria Jaller-Makarewicz from the Institute of Economics and Financial Analysis. “LNG import capacity is set to reach 406 billion cubic meters (bcm) in 2030, an increase of 143 bcm from 2021 levels, while gas consumption is forecast to fall to around 400 bcm as the continent pushes ahead with gas demand reduction policies. The utilisation rate of Europe’s LNG terminals averaged 58% between January and September 2023.”

“As a liquid, LNG takes up around 600 times less volume than gas at standard atmospheric pressure. This makes it possible to transport gas over long distances, without the need of pipelines, typically in specially designed ships or road tankers,” said a report titled “Liquefied Natural Gas and Gas Storage Will Boost EU’s Energy Security” by the European Commission. “When it reaches its final destination it is usually re-gasified and distributed through gas networks – just like gas from pipelines. LNG is also increasingly used as an alternative fuel for ships and lorries.”

According to a report from the Global Energy Monitor titled “Europe’s LNG import infrastructure glut set to more than double, jeopardizing green goals” by Baird Langenbrunner, there are proposals in the EU for a gas buildout of 227.2 billion cubic meters annually (bcm/y), which would increase the EU’s current maximum import capacity by 136%. Pipelines will still play a critical role with plans to build extensive transmission pipelines within the continent, with an additional annual gas pipeline import capacity of 60.5 bcm being proposed in Europe.

With Europe striving to seek alternative sources of LNG as part of its commitment to sanctions against Russian energy supplies, there has been an increased demand on the continent to build FSRUs and other essential facilities needed to properly manage the delivery of LNG shipments.

The Global Energy Monitor report elaborated that the infrastructure overhaul in Europe will cost between €53.5 billion and €22.1 billion to build the necessary LNG terminals and an additional €31.4 billion to have the essential pipeline infrastructure set up. The Europeans shouldn’t close with wallets yet with €4.2 billion needed for projects that are currently under construction.

“Europe has added six new LNG terminals since the beginning of 2022, plus one expansion, a previously mothballed terminal and a new floating storage regasification unit (FSRU) that

www.egyptoil-gas.com

The same report noted that Greece, Italy, and Germany combined make up an

estimated 53% of costs. Infrastructural reform in the EU was been on the top of the agenda for the EU as the nations worked to implement and accelerate up to 30 LNG terminal projects. The accomplishments have been impressive with 35.2 bcm/y of gas import capacity being commissioned between eight LNG terminal projects, in addition to 11.1 bcm/y in transmission pipelines from January 2022 to February 2023. Egypt has already masterminded its own infrastructural reforms to carve out its future as the region’s main hub for LNG. According to a report from Al Ahram titled “Egypt Expected to Maintain High Volumes of LNG Delivery to Europe: EU Energy Commissioner”, Egypt has up to 7,000 km in pipelines, in addition to a distribution network that extends 31,000 km, and 29 gas-treatment plants. Even though the current infrastructure may fall short of meeting the demand for LNG abroad, Egypt is already well on its way to being a major supplier for many markets in Europe and around the world, with its efforts in accelerating the projects needed to boost its LNG export capacity. The country has also been active in expanding its gas export infrastructure and capabilities with its recent agreements with both Jordan and Israel. According to a September 2023 report from GIS by Carole Nakhle titled “Egypt Gas Exports Under Threat”, Egypt is a nation capable of providing close to 5% of Europe’s gas consumption, which was achieved in 2022 through its two onshore LNG liquefaction plants and terminals in Idku and Damietta. Though these facilities have given the country the potential to export LNG since 2005, more is needed for Egypt to perform at its full potential. With an energy economy that still depends mostly on fossil fuels, enhancing the efficiency of logistics and supply chain processes has become vital in ensuring the punctual and secure arrival of energy supplies in various markets. LNG, for this reason, has emerged as a positive influence in the market with a solid transportation method that will be less costly and more reliable. LNG is ready for the global market, but what remains to be determined is whether global infrastructure is really ready for LNG.

EGYPT OIL & GAS NEWSPAPER 23

HELD UNDER THE PATRONAGE OF HIS EXCELLENCY ABDEL FATTAH EL SISI PRESIDENT OF THE ARAB REPUBLIC OF EGYPT

19 – 21 FEBRUARY 2024 I EGYPT INTERNATIONAL EXHIBITION CENTER

BE PART OF

THE REGION'S LEADING ENERGY CONFERENCES

VIEW THE AGENDAS

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SILVER SPONSORS

E N E R G Y

PARTNER

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DECEMBER 2023 - ISSUE 204

24 POLITICS

CHALLENGING SCENARIOS FOR POST-WAR GAZA BY IHAB SHAARAWY

he devastating conflict between Hamas and Israeli forces in Gaza has caused immense suffering, particularly for innocent civilians who have borne the brunt of the violence. Despite the Israeli campaign to eradicate Hamas, the goal seems increasingly distant, leaving Gaza in a state of uncertainty. While the future remains uncertain, several potential scenarios could unfold for post-war Gaza.

The scenarios for a post-war Gaza are varied, each presenting its own challenges and complexities. However, the revival of the two-state solution remains the preferred option among world powers. Forced Displacement Denied One scenario that has been vehemently rejected is forced displacement. Some Israeli officials have suggested pushing Gaza residents out of their lands as a means to resolve the conflict. However, this suggestion has been met with strong opposition from Egypt and other Arab countries. Arab states have made it clear that they are not willing to take in Palestinian refugees, as this could result in their permanent displacement. Jordan has also warned against Palestinians being forced off their land. The United States has also rejected the forced displacement of Palestinians from Gaza. Forced migration not only violates fundamental rights, but also fails to present a viable solution to the underlying issues. With forced displacement off the table, Israel is left with few options and challenging scenarios in their attempt to take over Gaza. One possibility is the reoccupation of Gaza by Israeli forces, which would involve maintaining control over the region and potentially leading to an extended period of military rule. However, this measure could perpetuate instability, fuel further resistance, and exacerbate tensions within the international community, something Israel cannot afford. Another scenario is the continuation of the status quo with tightened restrictions on Gaza residents. This scenario would involve stricter control over the movement of people, goods, and services in an effort to suppress Hamas and maintain security. However, this scenario is expected to hinder the process of Gaza reconstruction and perpetuate violence, potentially leading to a never-ending cycle of conflict.

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Another scenario is the continuation of the current situation with restrictions and a potential elimination of Hamas, allowing the return of the Fatah movement to govern Gaza. However, challenges include the credibility and legitimacy of a Fatah-led government, the potential for renewed violence, and the difficulty in completely eliminating Hamas. Revival of Two-State Solution Some suggest that Gaza could be governed by Arab neighboring countries or international peace forces to ensure stability and security. However, challenges may arise in coordinating efforts, securing cooperation from all parties, and establishing a structure that is acceptable to all stakeholders. Israel is likely to refuse this solution, especially under the current religiousright government. Reconstruction and economic recovery would remain difficult under this scenario. Despite these challenges, world powers view the revival of the two-state solution as the most viable option for a peaceful settlement. The creation of an independent Palestinian state alongside Israel could address the grievances and aspirations of both Palestinians and Israelis. President El-Sisi of Egypt has emphasized that the two-state solution is "the only way out" of the Israeli war on Gaza. This stance has been concurred by Arab states and the European Union. The two-state solution has gained momentum with the US President, Joe Biden, refusing to return to the status quo in Gaza and asserting that a two-state solution must be considered. China has also called for a concrete timetable and roadmap for a two-state solution. However, this solution still faces obstacles such as disagreements over borders, the status of Jerusalem, the right of return for Palestinian refugees, and overall political will from all parties involved. President El-Sisi has called on the international

community to recognize the Palestinian State and admit it to the United Nations, emphasizing the need for a different approach to the two-state solution. To achieve a lasting settlement, world powers must play an active role through diplomatic efforts, economic aid, security cooperation, and support for reconciliation. When the guns are silenced, concerted international efforts can pave the way for a peaceful and stable future for Gaza.

The scenarios for a postwar Gaza are varied, each presenting its own challenges and complexities. However, the revival of the two-state solution remains the preferred option among world powers.

Arab states have made it clear that they are not willing to take in Palestinian refugees, as this could result in their permanent displacement.

EGYPT OIL & GAS NEWSPAPER 25

OPINION COLUMNS

DIVERSIFYING EGYPT’S ENERGY MIX WILL BE THE MOMENTUM FOR FUTURE GROWTH

he energy mix has become an absolute necessity for Egypt to meet its future energy needs. Hence, it is essential to rely on renewable energy, which is produced from natural resources, such as solar energy, wind energy, or water, especially with the decline in Egypt's production of crude oil and gas in the future and the high cost of energy resulting from fossil fuels as a result of the high price expected in the future.

Egypt has generated energy from newly built wind facilities, such as the Zaafarana and Jabal al-Zayt wind farms, each of which produces more than 500 megawatts, and the Gulf of Suez wind station, which produces 250 megawatts and other plants are still under construction. There are many places in Egypt where the strong winds are suitable for the establishment of wind power plants. Egypt can also rely on solar energy because Egypt has a high level of solar intensity for more than 300 days a year, even if this is exploited with the availability of vast areas of desert land on which solar plants can be established to the extent that there are studies that confirm that Egypt can produce hundreds of megawatts of solar energy. Therefore, it is important to increase the number of factories that produce solar cells, especially with the availability of silicon sand (white sand) in Egypt, especially on the Mediterranean coast. If solar panels and batteries are manufactured in Egypt, their prices will decrease, thus reducing the cost of electricity and encouraging the private sector and citizens to establish solar plants in the future. Also, with the start of construction of the Dabaa nuclear plant, we have five years left to achieve the long-awaited nuclear dream, by operating the first peaceful nuclear power reactor to produce electricity in the Dabaa area of Matrouh Governorate in 2026. In November 2017, Egypt and Russia signed the final agreement to establish a peaceful nuclear power plant to produce electricity in the Dabaa area with a capacity of 4,800 megawatts, to be implemented by the Russian company Rosatom at a cost of $21 billion, and the project, which includes the construction of four nuclear reactors, is scheduled to be completed in 2028. We also hope that Egypt will start using a modern storage method that is distinguished from batteries due to its low cost and high storage capacity, which is called storing thermally renewable energy in dissolved salt. It depends on the energy produced from concentrated solar power plants. The Noor Ouarzazate project in Morocco is one of the largest concentrated solar power and photovoltaic projects in the world currently and was built with a total capacity of 580 MW. Also, Sheikh Mohammed bin Rashid Al Maktoum Solar Park is under construction in the United Arab Emirates, which produces 950 MW. Hence, we hope that Egypt will follow the example of this country in using this modern technology.

Sabry El Sharkawy General Manager & Managing Director of Wastany Oil Company

THE GAZA STRIP WAR: ASSESSING THE IMPACT ON ENERGY MARKETS

here are many concerns about the impact of continued hostilities between Israel and Hamas in the Gaza Strip, on global oil and gas supplies and prices.

Oil prices have risen slightly at the present time as a result of the war that broke out following the attack launched by Hamas on Israel on October 7th . Experts warn that fifty years after the oil embargo, imposed by Arab countries on countries supporting Israel during the latter's war with Egypt in 1973, the current crisis may lead to disruption of supplies and push prices to rise. The Middle East region represents nearly a third of the world's oil supply, and about 20% of global supplies pass through the strategic Strait of Hormuz, or the equivalent of 30% of the total oil transported by sea. The current crisis is widely considered the greatest geopolitical threat to the global energy market, since the outbreak of Russia’s war on Ukraine in February of last year 2022, according to experts. They also fear that the conflict will expand to include nearby oil-producing countries such as Iran and Saudi Arabia, especially if Iran closes the Strait of Hormuz. Even if Iran does not directly intervene in the conflict, the United States could tighten sanctions on Tehran if its involvement in the attack carried out by Hamas on Israel is made evident, which could exert more pressure on the oil market, which is already suffering from a shortage of supply. Analysts believe that the United States is unlikely to tighten sanctions on Iran, without Saudi Arabia agreeing to compensate for the lost Iranian barrels, a scenario that is considered unlikely to happen. When it comes to gas, the effects seem to happen faster. The price of natural gas on the European benchmark, increased by one-third in mid-October compared to preattack levels. Following the incident, US energy giant Chevron halted its operations in the area on orders from Israeli authorities, and the Israeli Ministry of Energy declared a temporary stoppage of production from the offshore Tamar gas field. This field accounts for an estimated 1.5% of global liquefied natural gas supplies, and it is mainly for the local Israeli market, then Egypt and Jordan. In normal times, stopping a field of this size would not have caused confusion in the gas markets, but the developments that these markets have witnessed in recent years, including the interruption of Russian gas supplies to Europe, and the latter being forced to search for alternatives at all costs, have made the gas markets more fragile and volatile; even if it comes to not huge quantities. If the war in Gaza continues and natural gas markets have to endure additional turbulence, this may reduce Europe's ability to deal with any other unexpected events - such as a harsh winter or interruption of supplies from other regions, which would increase the possibility of a rise in gas prices.

Mohamed Atia Process Engineer at Egyptian Refining Company (ERC)

DECEMBER 2023 - ISSUE 204

26 ECONOMIC SNAPSHOT

VALUE AND VOLUME OF SHARES TRADED FOR ENERGY & SUPPORT SERVICES SECTOR IN OCTOBER 2023

MAIN ECONOMIC INDICATORS

September 2023

Energy & Support Services

October 2023

ANNUAL INFLATION HEADLINE CPI

1.88 75.72

Total

40.3

2.48

38.5

NET INTERNATIONAL RESERVES

34.970 Energy & Support Services

0.18

Total

35.102

NON-OIL PRIVATE SECTOR PMI

48.7

1.01

17.76

PERFORMANCE OF PETROLEUM COMPANIES IN THE EGYPTIAN EXCHANGE IN OCTOBER 2023

47.9

EXCHANGE RATES British Pound

10.12

1,924%

EUR

USD

37.52

37.38

37.53

37.93

37.83

32.64

32.77

32.8

33.13

33.28

30.94

Week 4

Week 5

Week 3

Week 1

OCTOBER

11.25

78.01%

117.23%

Source of Raw Data: CBE, CAPMAS, Egyptian Exchange, PMI by S&P Global

www.egyptoil-gas.com

EGX 70 EWI

EGX 100

9.22% 23,262

21,617

28.5

NOVEMBER

CAPITAL MARKET INDICATORS

EGX 30

33.77

Week 2

7,160

6,909

6,581

6,579

5,946

24,383

24,313

22,640

3,919

4,339

4,413

4,659

4,866

15-19 OCT

22-26 OCT

29 OCT-2 NOV

5-9 NOV

12-16 NOV

EGYPT OIL & GAS NEWSPAPER 27

EGYPT STATS

01 UPSTREAM HIGHLIGHTS IN FY 2022/23 161.9 363

Drilled Wells

Total Production

100

6.2 bcf/d

36.8

Total

463

Average Production of Natural Gas

mmbbl

Crude Oil

Condensates

Exploratory

Development

02 ESTABLISHING THE 4 PRODUCTION LINE CONNECTING TO THE WESTERN DESERT GAS COMPLEX* TH

Company

Added Capacity to the Complex

Investment

$380 million

GASCO

Products

600 mmcf/d

Natural Gas, Raw material made of Ethane and Propane mixture, Butane Gas and Condensate & Commercial Propane Produced for Export

*Announced on October 29, 2023

EXPORTS VALUE IN FY 2022/23 03 PETROLEUM ($ MILLION)

TANKERS PASSING THROUGH SUEZ 04 OIL CANAL IN FY 2022/23

11,484

2021/22

2022/23

Growth Rate (YoY) (%)

Exports

5,451

2,333

No. of Tankers

8,040 Crude Oil

Total Petroleum Exports

47.5

Petroleum Products*

13,817

Share from Total Exports

236.5

34.9% Net Tonnage

65.5

391.6

*Including Natural Gas & Bunker and Jet Fuel

mmt

05 INTERNATIONAL OIL PRICES BRENT PRICES ($/BBL) 90.6

6 September

92.30 96.55

27 September 84.07

5 October

88.54

84.63

1 November 77.42

NATURAL GAS PRICES ($/MMBTU) 2.51

97.08

87.93

26 October

16 November

OPEC BASKET PRICES ($/BBL)

2.764 3.166

91.68

3.214 3.494

88.54 82.22

3.062

DECEMBER 2023 - ISSUE 204

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• Wells with inefficient, or inconsistent or unpredictable drilling performance i-Trak™ drilling automation services from Baker Hughes reduce operational risk and well delivery costs by integrating and automating drilling systems.

hydraulics, and drilling optimization services.

• Wells with hole cleaning issues, stability issues, or challenging pressure windows

In today’s complex drilling environment where surface and downhole real-time systems must deliver according to plan in a predictable, efficient, and safe manner, automation of drilling systems is crucial. The drive to reduce HSE risks by moving personnel from wellsite red zones to remote centers is simplified and supported through the integration and automation of drilling systems.

i-Trak services offers two levels of automated control: • Advisory mode: recommended actions or parameters are displayed to the driller who can accept or reject them

• Wells that must be consistently and repetitively drilled

Baker Hughes’s i-Trak drilling automation services improve drilling performance, wellbore quality and trajectory; extend bit life; reduce nonproductive and invisible lost time (NPT, ILT) to deliver wells faster and more economically while reducing operational risk to enable de-manning at the rigsite. These benefits are achieved by aggregating real-time surface and downhole data and annular pressures, and using hybrid physics-based and data-driven models, in combination with automated standardized operating procedures and checklists. Our i-Trak drilling automation services manage well construction via fully closed loop-control of Baker Hughes rotary steerable assemblies, wellbore

• Closed-loop mode: parameter changes and instructions are automatically downlinked to downhole tools or transmitted to rig automation platforms to control surface parameters. In closed-loop mode, the human driller can start/stop the system at any time to make any desired adjustments to the drilling path or operational parameters. The i-Trak service is a fully integrated extension of Baker Hughes’ digital well planning software and ecosystem. This allows i-Trak to monitor and control drilling and reservoir navigation operations based on a continuously updated digital twin of the reservoir and downhole environment. Contact your Baker Hughes representative to learn how i-Trak drilling automation services can help you achieve safer, more efficient, and more predictable performance on your next well.

• Wells using decision-making remote operations or leveraging integrated operations personnel models

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• Improved safety, lower risks - Openhole pressure regime monitoring with automated alerts

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