Naftogaz Inks USD 30 mln Exploration Deal With Egypt

According to a press release by Naftogaz Ukrainy, the company has signed a 27-year exploration and production agreement with the Egyptian government to explore a 980 sq km area in the eastern part of Egypt’s gas-rich western desert of Alam El Shawish. Naftogaz, which will drill 12 exploratory holes, estimates the area’s reserves at around 73.5 mln tones (542 mmboe), almost equal to Ukraine’s total reserves. The agreement calls for Naftogaz to open a JV with the Egyptian General Petroleum Corporation and invest about USD 20.2 mln to explore the area’s oil/gas fields over the next three years. Naftogaz is entitled to 15%-19% share of the field’s output, which is expected to be about 2 mln tones of oil per year.