Egypt has manufactured its first locally produced oil rig as part of efforts to reduce its reliance on imported equipment.

The 2,000-horsepower automatic trailer-mounted onshore oil drilling rig was manufactured by an Egypt-China joint venture in Egypt’s port of Ain Sokhna.

At the delivery ceremony, Egyptian Minister of Petroleum and Mineral Resources Tarek el-Molla said: “This is the first made-in-Egypt oil drill and will help carry out drilling programmes.”

He said manufacturing drilling rigs locally is a new and important step for the country’s oil and gas sector.

El-Molla said it would allow companies to accelerate drilling plans and increase oil and gas production amid growing demand.

“The drilling rig is the result of fruitful economic cooperation between Egypt and China and a successful example for transferring the manufacturing technology from China to Egypt,” El-Molla said.

Zhang Chaoyang, who represents the Chinese Embassy in Egypt, said the project’s successful delivery resulted from years of cooperation between Chinese companies and their Egyptian partners.

“This is a bold example of the active participation of Chinese-funded companies in Egypt in the joint construction of the Belt and Road Initiative,” Zhang said.

Egyptian Petroleum HH Rig Manufacturing (EPHH) manufactured the rig, funded by subsidiaries of China’s Honghua Group and state-owned Egyptian General Petroleum Corporation (EGPC).

Zhu Hua, executive vice-president of Honghua Group, told China’s Xinhua news agency that localised production of the drilling rig in Egypt had alleviated the country’s shortage of imported oil and gas equipment.

He also said that it had helped improve the training of local engineers, something that would benefit Egypt’s hydrocarbon and mining sectors.

Egypt is struggling to import materials and equipment for major projects due to a collapse in the value of the Egyptian pound.

The Egyptian pound has been one of the world’s worst-performing currencies during 2023, extending a decline against the US dollar that saw it lose more than half of its value in 2022.

Inflation in the North African country hit a five-year high in February — rising 31.9 per cent year-on-year amid soaring food prices, which the war in Ukraine has exacerbated.