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We are confronting another huge challenge and, like climate change, it has been encroaching for years. In concert with global warming, and in an unholy alliance, comes the decline of oil and gas.
For thousands of years slaves and cheap labour supported civilisation but, following the Industrial Revolution, humanity began to thrive on stored solar energy contained in coal, oil and gas. Used for transport, heat and cold, and materials too, notably concrete, metals, plastics and fertilisers, fossil fuels have increased human capacity a hundred fold and our standard of living, indeed our capacity to stay alive, now depends on them as we burn through 16 billion of tonnes a year, releasing double that weight of carbon dioxide into the atmosphere in the process. But, although huge volumes remain in the ground the easy pickings are long gone. The new stuff is deeper in the earth, deeper under water, and in remoter, more formidable environments.
Still, this is not the whole story. This is not where the real challenge lies.
Over the last 50 years, as demand for oil and gas soared and supply routes multiplied, ever more sophisticated equipment was required for extraction, processing and transport all of which needed energy, and lots of it. As a consequence the Energy Return on Investment (EROI); the ratio of the amount of energy delivered from a resource to the amount used to obtain that resource, has fallen precipitously and is still falling.
The EROI, this is the challenge.
Of course there is no doubt, at least for most of us, that burning fossil fuels damages our environment. We face an existential threat to the world’s current climate balance on which 8 billion people relies. So, while the net energy content from fossil fuels dwindles, we must find new cleaner sources which also require substantial amounts of energy to exploit and other things too such as uranium, graphite and rare metals, for magnets, batteries, and electronics.
Less net energy, scarce materials, resource nationalisation, high costs and inflation. It is a recipe for human hardship and, of course, resource wars. And what are we doing to counteract this perfect storm? In regards to EROI, not much at all.
The energy and transport industries are developing alternatives, experimenting with carbon capture and converting to electrified transport. But some organisations are making things worse, attempting to ‘stop oil’ and damage economies in countries most active in mitigating the problems. A reduction in the financial strength of commercial organisations and governments reduces their capacity to pay for new technology and infrastructure and other strategies to mitigate the effect of a changing climate.
We should all feel free to persuade (or force) humans to use less energy for leisure activities but careless attempts to cut essential supplies through bans and boycotts can kill people more quickly and efficiently than climate change ever could. Make no mistake ‘clean’ energy supplies are still insufficient to meet our needs. Only by retaining fossil fuels in controlled decline while expanding renewable and mitigation strategies can human death and destruction be, perhaps, avoided.
Falling EROI is happening. Climate change is happening. But surely we should also work to provide sufficient energy for all our 8 billion people. Like it or not, fossil fuels remain fundamental to the existence of our crowded human world.
Dec 2019: SDX Energy (operator, 55%) has achieved its targeted plateau production rate of 0.52 bcm a year from the South Disouq concession. Gas flows through the CPFfrom 4 wells. A South Disouq development drilling campaign will commence in Q1 2020.
Sep 2019: Eni and BP report that the Baltim South West offshore gas field in the Great Nooros area has begun production. Located 12 kms off the coast in the Baltim South development lease, the field was discovered in 2016 The platform links to the onshore Abu Madi Gas Plant via a 44 km 26 inch pipeline.
Aug 2019: Production from the Zohr gas field totalled 11.3 bcm during the first half of 2019, 3.6 times more than in the same period in 2018.The field has 11 wells, 3 offshore pipelines, a management platform and an 8-train gas treatment plant. Zohr came onstream in December 2017.
Mar 2019: Eni (operator, 40%), with BP (25%), Mubadala Petroleum (20%) and Tharwa Petroleum (15%), has made a gas discovery at the Nour-1 well in the Nour North Sinai Concession, in the Mediterranean Sea north of the Sinai peninsula. The well was drilled in a water depth of 295m and found a 90m gas column in the Oligocene Tineh formation.
Mar 2019: The Ministry of Petroleum and Mineral Resources launched the Offshore Red Sea International Bid Round 2019 (10 blocks). South Valley Egyptian Petroleum Holding Co. (Ganope) manages petroleum activities in the Red Sea. Closing date for bids is August 2019.
Feb 2019: BP (operator, 82.75%) announced first gas from the 2nd stage of its offshore West Nile Delta development producing gas from 8 wells in the Giza and Fayoum fields via a tie-back to onshore. The development includes 5 fields in the North Alexandria and West Mediterranean Deepwater blocks. Stage 1 started in 2017 from the first 2 fields, Taurus and Libra. The 3rd stage will produce the Raven field in late 2019.
Sep 2018: Eni with EGPC (joint operating company Petrobel, 50%) announced the Zohr field is producing 20 bcm a year after start-up of the fifth production unit (T4) with 8 producers and a new pipeline. Plateau production at over 28 bcm a year is planned by 2020. The Zohr field lies in the offshore Shorouk Block. Partners are Rosneft (30%), BP (10%) and Mubadala (10%).
Aug 2018: Eni (Agiba, 100%) announced a gas discovery in the Faramid South well in the East Obayed Concession, 30 kms NW of the Meleiha Concession. The well encountered gas bearing layers in the Kathabta sandstones of Jurassic age within the Western Desert Basin.
May 2018: Egypt will launch 2 bid rounds in 2018 announced the Petroleum Ministry. One large round will cover 16 sectors under EGAS and the other will cover 11 sectors under EGPC.
May 2018: Eni announced the start-up of the third production unit (T-2) of the Zohr project, increasing installed capacity to 12.4 bcm a year. Zohr is producing 11.4 bcm per year in ramp-up a few months after the field’s start-up in December 2017. A production level of 20 bcm a year by end 2018, and a plateau of 30 bcm a year in 2019 is planned.
Apr 2018: Eni through Petrobel (operator, 60%) started up the 2nd production unit (T-1) of the Zohr project in the Shorouk Block in the Mediterranean Sea, increasing capacity to 8 bcm a year. Ramp-up will continue, reaching a capacity plateau of 27 bcm in 2019. Zohr started production in December 2017. Partners are Rosneft (30%) and BP (10%).
Apr 2018: Egypt will auction up to 11 exploration blocks in the Mediterranean and aims to auction oil and gas drilling in the Red Sea by the end of 2018. The country also hopes to speed up production from recently discovered fields.
Apr 2018: SDX Energy (operator, 55%) announced a gas discovery at the Ibn Yunus-1X exploration well in the South Disouq Block, onshore the Nile Delta. The encountered gas in the Abu Madi horizonand will be completed as a producer then tested and connected to the infrastructure at the original SDX discovery where production start-up is anticipated in the second half of 2018.
Mar 2018: The offshore Nooros gas field, operated by ENI (75%) with BP (25%) reached a production rate of 11 bcm a year following start-up of the NW-7 well, the 13th in the field. Nooros was discovered in in the Nile Delta and put into production in record time. In 2019 it will be tied back to the El Gamil onshore treatment plant along with the Baltim SW field.
Feb 2017: BP announced the start of gas and condensate production from the offshore Atoll Phase One project in the North Damietta concession in the East Nile Delta. Phase One is an EPS costing almost US$1 bn including recompletion of the original exploration well and drilling of 2 production wells. Production is exported to the onshore West Harbor gas processing plant.
Dec 2017: The Zohr gas field in the Shorouk Block has started production with gas pumped to a facility in Port Said.
Nov 2017: Egypt will stop importing LNG in 2018 after it starts producing at the Zohr field, which will mostly supply the domestic gas market. The 2 existing LNG plants will process any available surplus. Egypt exported gas until 2014 and should resume exports in 2019.
May 2017: BP has started gas production from 9 wells in the first 2 fields (Taurus and Libra), of the West Nile Delta project. West Nile includes 5 gas fields in the North Alexandria and West Mediterranean Deepwater blocks. When fully onstream in 2019 production, which will be fed into the national gas grid, will reach 14 bcm a year plus condensate.
Mar 2017: BP (operator, 100%) has made a gas discovery in the Qattameya Shallow-1 exploration well within the North Damietta Offshore Concession of the East Nile Delta. The water depth is 108m.
Mar 2017: ENI reports that the Zohr deep water gas field will start production in December. Zohr was discovered in August 2015 and could hold 5.5 bn bbls of oil equivalent.
Jun 2016: BP (operator, 100%) and EGAS announced sanction of the Atoll Phase One project; an early production scheme that will bring up to 3.1 bcm a year of gas plus condensate to the market from 2018. Onshore processing will be handled by the existing West Harbour gas processing facilities. Recompletion of the exploration well and drilling of two additional wells will be carried out.
Jun 2016: Petrobel (operator 50% - a joint venture between Eni (IEOC) and EGPC) and BP (50%) have made a significant gas discovery at the Baltim South West-1X well in 25m of water in the Baltim South license, offshore Nile Delta. It is 10 kms north of the Nooros field, discovered in 2015 and already producing gas. The discovery confirms the potential of the Great Nooros Area.
Apr 2016: Egypt plans to launch a new oil exploration round offering 11 blocks in the Western desert and Gulf of Suez. It also plans to launch two gas exploration rounds in 2016.
Feb 2016: Eni has completed the authorization process for the development of the Zohr gas field. The development plan envisages the start of production by the end of 2017. The field could hold 900 bcm of gas in place and is the largest gas discovery ever made in Egypt.
Oct 2015: Eni announced success in the Nidoco NW 3 well (drilled from onshore); an appraisal of the Nidoco NW 2 Dir discovery, in the Nooros prospect within the Abu Madi West licence in the Nile Delta. Discovered in July, it was put into production after just 2 months with products sent to the Abu Madi treatment plant.
Oct 2015: EGAS has awarded 4 new licences off its Mediterranean coast to BP, Edison, a BP/ENI consortium (North Ras El Esh) and an ENI/BP/Total consortium (North El Hammad). The work programs include seismic and 8 exploration wells. The country will also launch a new bidding round in the first half of 2016.
Aug 2015: Eni (operator, 100%) has made a giant gas discovery at its Zohr 1X well in the Shorouk Block, Mediterranean Sea, in 1,450m of water. The discovery could hold up to 850 bcm of gas.
May 2015: Shell and Apache will start shale gas production from the Apollonia field in the Western Desert in 2016. Two wells will be linked to the national network.
Apr 2015: Apache reported successful development drilling (5 wells) on the Berenice and Ptah fields in the Faghur Basin (Western desert, Khalda Offset Concession) following on from oil and gas discoveries at the nearby Shu-1X, Apries-1X, Bat-1X and Geb-1X wells. Apache plans to increase production from these two fields to 17,500 bbls per day by mid 2015.
Mar 2015: BP has made a second gas and condensate discovery in the North Damietta Concession. The Atoll-1 exploration well in 923m of water in the East Nile Delta, 80 kms north of Damietta, is the country's deepest well ever drilled. Production of 42 bcm of gas and 31 mmbbls of condensate could begin in 2019 if fast-tracked.
Mar 2015: BP (operator) has agreement for the West Nile Delta (WND) project to develop 142 bcm of gas and 55 mm bbls of condensate with US$12 bn. Production will be up to 12 bcm a year starting in 2017 from the North Alexandria and West Mediterranean concessions. Taurus/Libra fields will be tied-in to Burullus facilities. Giza/Fayoum/Raven fields will be tie-backs to shore.
Jan 2015: Mena International Petroleum (100%) has announced the start of field development at the Lagia heavy oil field in Sinai. This includes hydraulic stimulation of the Lagia 6, 7, 8, 9 and 10 wells with thermal recovery. Production of 350 bbls of oil per day is planned followed by 5 additional wells to be drilled in the middle of the year.
Jan 2015: Six oil and gas exploration contracts have been signed with foreign and Egyptian companies requiring the drilling of 41 wells in the western desert and Gulf of Suez. Among them are Shell, ENI, BP and TransGlobe Energy. The country has repaid US$2.1 bn of debt to foreign firms to restore confidence but it still owes US$3.1 bn.
Dec 2014: Egypt has signed its first contract to extract gas by hydraulic fracturing with Apache and Shell. The project, initially involving drilling 3 wells in the Abu al-Ghardeeq region of the Western Desert, will require horizontal drilling.
Nov 2014: BP has been awarded 2 blocks in the 2013 EGAS bid round. Block 3 (North El Mataria) is onshore in the NE of the Nile Delta cone. BP (operator, 50%) will partner Dana Gas (50%). Block 8 (Karawan Offshore) is in the NE Mediterranean and will be operated by ENI (50%). Three exploration wells will be drilled in each block over 8 years.
Sep 2014: Dana Gas has been awarded the North El Salhiya (Block 1, 100%) and El Matariya (Block 3, 50% with BP) onshore concessions in the Nile Delta in the 2014 EGAS bidding round.
Sep 2014: Eni was the successful bidder for 3 exploration licenses in the 2013 EGPC and EGAS bid rounds - 100% in the onshore South-West Melehia block in the Western Desert, 100% in Block 9 (North Leil Offshore) and 50%, with BP, in Block 8 (Karawan Offshore), both located water depths over 2000m in the Mediterranean near the boundary with Cyprus.
Aug 2014: The DEKA (Denis Karawan) project in the Temsah Concession in the offshore Nile Delta has come onstream. IEOC (ENI) (50%) is operator along with BP (50%). The Denise South 6 well in 100m of water is producing 0.66 bcm a year with condensates at 800 bbls per day. The project will include 5 subsea wells and a pipeline to the El Gamil Gas Plant. Peak production is expected in 2015 at 2.4 bcm a year.
Jun 2014: Production from BP's US$10 bn gas project in its North Alexandria concession, which has been stalled for 3 years, will begin in 2017. Initially reaching 4.5 bcm, it will rise to over 8 bcm after 2018. Egypt now requires gas imports over the next 4 to 5 years to avoid power continued outages.
Feb 2014: The Ministry of Petroleum and Mineral Resources has signed exploration agreements with 3 companies this week, expected to attract a US$265mm investment. The 3 companies, Petroceltic, Dana Gas and Edison will drill a minimum of 8 exploration wells in the Mediterranean sea, the Gulf of Suez and the Nile Delta.
Dec 2013: EGPC announced an auction of 22 PSC concessions in the Suez Canal, the western desert, the Mediterranean Sea and the Nile Delta. The auction will end on May 19 2014. Egypt also signed 2 new exploration agreements with Dana, who produce 12,000 bbls of oil per day from 17 development leases and, earlier approved 7 agreements with firms including BP and Peroceltic.
Sep 2013: RWE Dea has produced first gas from the Disouq concession in the Kafr el Sheikh Governerate of the Nile Delta. The project encompasses development of 7 fields and production is expected to reach around 4 mm cubic metres per day by mid 2014. It is planned to produce 11.4 bcm of gas in the first 2 project phases. RWE Dea holds 100% of the concession, awarded in 2004.
Sep 2013: BP, operator with 100%, has announced a significant gas and condensate discovery. Salamat, in the East Nile Delta, is the first well in the North Damietta Offshore concession granted in Feb 2010. The well was drilled using the semi-sub Maersk Discoverer in a water depth of 649m. Tie-back options to the nearby Temsah field are currently being evaluated.
Jul 2013: Apache has reported 7 new oil and gas discoveries in various basins across the Western Desert including the Riviera SW-1X well, already onstream in the WD 30 Development Lease in the Abu Gharadig Basin and the Narmer-1X well, near the Neilos field, an emerging Paleozoic play in the Khalda Offset Concession.
Jun 2013: Dana Gas has announced a new gas and condensate discovery on the West El Manzala concession in the Nile Delta. Begonia-1 encountered 15 m of net pay in a sandstone reservoir of the Lower Abu Madi Formation. It will be tied into the South Abu El Naga field pipeline taking gas to the El Wastani processing plant. Begonia-1 is the 25th discovery by Dana since 2007 and the company is now producing 1.75 bcm of gas a year and 4,000 bbls per day of condensate.
May 2013: Apache has announced 3 discovery wells in the Western Desert in 3 different basins. The company operates on average 26 rotary rigs in Egypt. The discoveries are NRQ 3151-1X (oil and gas) in the Alamein Basin, North Ras Qattara Concession; SIWA L-1X (oil and gas) in the Faghur Basin, Siwa Concession; and NTRK-G-1X (gas/condensate) in the Matruh Basin, North Tarek Concession.
Apr 2013: Egyptian Natural Gas Holding Company has awarded 8 licences in the Mediterranean Sea to BP, Petroceltic, ENI, Edison, IEOC, Sea Dragon Energy, Dana Gas and Pura Vida Energy. The winning companies will drill a minimum of 18 wells and spend US$1.2bn.
Mar 2013: Apache has discovered oil and gas at Amoun NE on the north flank of the Khalda Ridge. The close proximity to production facilities is expected to enable quick startup of production. Apache plans to drill 3 development wells and 2 nearby exploration wells as well as several additional prospects on the southern flank of Khalda Ridge in 2013. Apache also reported success at the WD 33 Development Lease in the Abu Gharadig Basin. The company plans to drill 270 wells in Egypt in 2013, including 60 exploration wells.
Jan 2013: Ganoub El Wadi Petroleum Holding Co. (Ganope) has launched Egypt’s international 2012 bid round 1. This includes 20 exploration blocks, including blocks 14 and 15 in the Red Sea and blocks 16 to 20 in the Gulf of Suez. The closing date for applications is May 30, 2013.
Aug 2012: BP announced the discovery of gas in the Taurt North and Seth South fields in the North El Burg offshore concession, Nile Delta. Satis and Salmon were previous discoveries made by BP in this concession. The Scarabeo 4 semi-submersible drilled the wells in water depths of 110m and 78m, respectively. The plan is to tie both discoveries to nearby infrastructure.
North and Northwest Africa
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