|During signing an agreement between EGPC and ENI 1-6-2015|
A source with the Agreements Department at the Egyptian General Petroleum Corporation (EGPC) stated to Egypt Oil&Gas that Egypt buys Eni’s equity gas from Zohr field for $5.8 per 1m thermal unit (BTU), according to the recent agreement in November 2016 between the Egyptian Prime Minister, Sherif Ismail, the Minister of Petroleum, Tarek El Molla, and Eni’s officials.
The source added that the Egyptian government agreed with the Italian partner to hold negotiations in January 2017 to review the agreement and decide on new selling price of Eni’s gas for 2018. They also agreed on reviewing the agreement in 2019.
He further stated that Eni will receive 40% of the gas produced from Zohr to compensate for drilling and development costs. Then the remaining gas will be divided into 35% for Eni and 65% for EGPC.
Total investments at Zohr are estimated at $7b that will be spent over a 3-year period. Yet, the agreements with Eni will further inject $2.1b investments into Egypt’s oil and gas sector. This comes as Eni plans to start the Zohr’s production by the end of 2017 to produce 1bcf of gas that is planned to increase to 2.7bcf by 2019. Zohr field has estimated 30tcf of natural gas in place.