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Oil majors win Egypt gas exploration blocks

30 June 2025

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State-owned Egyptian Natural Gas Holding Company (EGAS) has awarded six new exploration blocks as it tries to boost domestic production.

The licence awards are expected to lead to investments worth $245m and the drilling of 13 new exploration wells in the awarded blocks, according to a statement published by EGAS.

The awarded blocks include four offshore blocks in the Mediterranean, which were offered in the 2024 international bid round, and two onshore blocks in the Nile Delta and North Sinai.

Companies that have been awarded blocks include US-headquartered Chevron, London-headquartered Shell and Italy’s Eni.

The awarded blocks are:

  • North Samian Offshore Block & Northwest Atoll Offshore Block – Awarded to a consortium of Chevron and Shell. There are plans to drill two exploratory wells in each block.
  • North Ras El-Tin Offshore Block – Awarded to Eni. There are plans to drill three exploratory wells.
  • East Alexandria Offshore Block – Awarded to Cairo-headquartered Cheiron. There are plans to drill three exploratory wells.
  • North Tanta Onshore Block (Nile Delta) – Awarded to Texas-headquartered IPR Energy Group. There are plans to drill two exploratory wells.
  • El-Fayrouz Onshore Block (North Sinai) – Awarded to the UK/French oil and gas company Perenco, which plans to conduct a 3D seismic survey and drill one exploratory well.

In its statement, EGAS highlighted that more gas assets are available for investment on Egypt’s online oil and gas portal, known as the Egypt Upstream Gateway.

The assets available for investment include several undeveloped offshore discoveries in the Mediterranean.

The bidding for these areas is scheduled to close on 2 July 2025, and the results are expected to be announced after bid submission closes.

In 2024, natural gas accounted for 47% of Egypt’s primary energy consumption and 81% of its power mix. The country restarted liquefied natural gas (LNG) imports in 2024 after a six-year hiatus.

In February, MEED reported that the total value of active Egyptian gas projects had fallen by 79%, despite a steep decline in domestic gas output that has ramped up the need for costly imports.

At the start of 2019, the total value of active gas projects in Egypt was $41.5bn. This has now sunk to $8.6bn, according to data from regional projects tracker MEED Projects.

Despite the billions of dollars of investment in upstream projects in Egypt’s gas sector in recent years, production has been dropping since it peaked in 2021, according to the Energy Institute’s Statistical Review of World Energy.

In 2021, Egypt produced 67.8 billion cubic metres (bcm) of gas. This fell to 64.5 bcm in 2022 and 57.1 bcm in 2023.

In May 2024, Egypt’s domestic gas output hit a six-year low, down by about 25% from its 2021 peak.

Declining domestic production has led to a severe energy shortage in Egypt.

Last year, the North African country had to resort to load-shedding to keep its grid functioning amid a lack of gas supply and rising demand. The deepening energy crisis, meanwhile, strained Cairo’s budget as it grappled with a heavy subsidies bill.

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Wil Crisp

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