Mubarak gives green light for launching an Oil Field in the Gulf of Suez
Egypt, Economics, 1/16/2002

Egyptian President Mubarak has given the green light for launching Sharq Al Zeit oil field northern Hurgada, in the Gulf of Suez. The new discovery has its big significance as it has recalled attention to the existence of big reserves of oil in the Gulf of Suez, the new oil field yields 8,000 barrels per day bpd to be raised to 40,000 bpd within two years.

This discovery is the most important one in the field of crude oil in Egypt in a period of 11 years.

Accompanied by Prime Minister Atef Ebeid, Mubarak toured the project, where Minister of Petroleum Sameh Fahmy briefed him on the developments achieved in the oil sector over the past few years.

Fahmy said his ministry managed to increase production of petroleum and gas products by 80 million tones. He said that the ministry was exerting more efforts to enhance local petrochemical industries to reduce imports.

"The state invests up to five billion US dollars on natural gas projects every year. New oil finds since 1999 increased the level of confirmed oil reserves by at least 540 million tones. Egypt's share in these finds is 350 million tones worth 29 billion US dollars," Fahmy told the President.

He expected Egypt to generate up to 850 million US dollars from exporting natural gas to Jordan, Syria and Lebanon through a pipeline network.

"The accord for exporting natural gas to Jordan as the first stage of the project has already been signed. Jordan will start receiving Egyptian natural gas from July 2003," he noted.

The Minister also said that Cyprus was also interested in clinching a deal with Egypt to import Egyptian natural gas.

Fahmy said that in a bid to enhance local production, two new holding companies for natural gas and petrochemicals were created. "Fifty-five per cent of petroleum or natural gas projects are carried out by national companies," he said.

Fahmy added that Egyptian and Kuwaiti investors had also started establishing a factory in the coastal city of Port Said to manufacture natural gas pipes.

The Minister said that petrochemicals industry in Egypt was a huge success story. "Egypt exported petrochemical products to 32 countries so far," he said, adding that talks were underway, to open new markets for the Egyptian products.

Fahmy also highlighted the oil sector's contribution to solving the unemployment problem in Egypt.

He told the Egyptian leader and accompanying officials that the oil sector had created 4,000 new jobs.

He expected more foreign investments in the natural gas' field after his ministry had amended the pricing of natural gas in deals with foreign companies.

"We do not need to buy the shares of foreign companies any more. On the contrary, our foreign partners seek to buy our share in the natural gas projects that are geared towards exports," he said.

He said that reports by the Organization of Arab Petroleum Exporting Countries (OAPEC) gave Egypt a lead rating in terms of new discoveries of oil and natural gas.

Out of a total of 41 oil finds in OAPECmembers, 24 were made in Egypt.

Also seven of a total 17 natural gas finds were made in Egypt," he said.

He added that attracting foreign investors and companies to work in the oil and natural gas fields in Egypt would also help bring modern technologies to Egypt.

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