Cairo expects $25 billion of foreign investments in natural gas fields’ development

Egypt expects that British company BP and the Italian Eni to pump investments into the country worth $25 billion for the development of three natural gas fields in the next four years, Egypt’s Petroleum and Mineral Resources Minister Tariq Al-Mulla said on Tuesday.

Egypt hopes to add 2.7 billion cubic feet per day of natural gas from three fields by 2019, which could help it meet its growing needs of natural gas.

Eni said last March that it would cut its total capital spending by 21 per cent and exploration budgets by 18 per cent, while it will gain 7 billion Euros (around $7.9 billion) from asset selling as part of its working plan for the period from 2016 to 2019.

An Egyptian Ministry of Petroleum official said before the Arab League General Secretary that his country expects the value of its petroleum and liquefied natural gas imports to decrease as soon as these fields start their production stages in 2017. Mohammed Tahir, the ministry’s undersecretary made the statements on behalf of the Egyptian Petroleum Minister.

He noted that this production will help cut the value of subsidies provided by the Egyptian government, explaining that the decline in world oil prices is expected to ultimately create a balance between the negative and positive effects for the Egyptian petroleum sector.

He predicted further turmoil in the global petroleum market over the coming period, influenced by factors that are difficult to forecast, including international conflicts as well as local problems in some oil-producing countries.

Oil prices rose in futures contracts yesterday, and U.S. crude oil climbed to its highest level in seven months to reach $48.39 a barrel. Additionally, international benchmark Brent Crude increased to stand at $49.34 a barrel, approaching its highest level in seven months.