Tarek El Molla, Minister of Petroleum and Mineral Resources: Interview

Tarek El Molla, Minister of Petroleum and Mineral Resources

Interview: Tarek El Molla

What steps are being taken to boost the sector’s investment attractiveness?

TAREK EL MOLLA: The ministry has adopted a plan to attract investments by offering new international bids and increasing the number of agreements with international companies. Since the June 30 revolution in 2013 the number of new oil and gas agreements has totalled 83, with investment reaching about $15.5bn. This is in addition to the ministry’s commitment to continue paying off the accumulated arrears to foreign partners, as well as regular arrears. The results of increased investor confidence can be seen in the launch of the gas production project by multinational company BP and DEA Deutsche Erdoel in the North Alexandria fields.

Moreover, following the discovery of the giant Zohr Field via Eni and the Atoll field, the projects assigned to the development and production of gas in these fields are being accelerated, with investment totalling $30.2bn. These gas fields and other major projects are the cornerstones for achieving natural gas self-sufficiency by the end of 2018.

How can Egypt enhance its role as a transit point for the regional hydrocarbons trade?

EL MOLLA: We are currently working on transforming Egypt into a regional hub for trading gas, first and foremost, and petroleum products. This comes under the framework of the sustainable development strategy Vision 2030. The first step involved in this process is the issuance of the gas market regulatory law and its regulatory body.

Additionally, new projects in the Ain Sokhna area are currently being implemented, along with construction of marine platforms and storage facilities. There are also projects in the Sidi Kerir, Al Hamra and Dekheila terminals, including facilities for crude oil.

Egypt has a huge existing refining capacity, with new units being established. This is in addition to the pipeline networks for transporting petroleum products and gas throughout the country, which are being developed, updated and extended on a regular basis. Egypt owns two liquefied natural gas plants on the Mediterranean coast, in Damietta and Idku, maximising Egypt’s role in the natural gas trade. This trend is supported by its unique geographic location in the middle of energy-producing countries, and its proximity to the Suez Canal, the most important navigational corridor in the world.

Another step in transforming Egypt into a regional hub involves establishing a price index for the region. This will require Egypt to become a centre for trading gas and petroleum products, whether produced locally or regionally from surrounding markets.

Which areas do you believe offer potential for additional onshore oil and gas discoveries?

EL MOLLA: Both the Western Desert and the Nile Delta are very promising areas. The Western Desert contains new geological layers with reserves that require extra investment, agreements and intensive activities to be estimated and exploited. Six agreements have been signed for oil and gas exploration in the Western Desert with US companies, including Apache, Apex and Merlon, as well as British-Dutch firm Shell. We have also concluded a number of agreements in the Nile Delta, with international companies for gas exploration programmes.

We are currently exploring open areas in the Western and Eastern Deserts and the Gulf of Suez, and are undertaking procedures to prepare offers to investors. The ministry is also looking to place both Upper Egypt and the Red Sea on the investment map for the export of oil and gas. We have recently launched the largest project for conducting seismic surveys in the Red Sea with investments totalling upwards of $750m, with similar surveys planned for the Gulf of Suez and Western Mediterranean.

Anchor text: 
Tarek El Molla

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The Report: Egypt 2018

Energy chapter from The Report: Egypt 2018

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