Egypt has officially announced the discovery of a significant natural gas reserve in one of its offshore blocks in the Eastern Mediterranean.
While Oil Minister Tarek El Molla told a parliamentary committee last Thursday that the well, located in the Nargis block, was still being evaluated, the information report of the Middle East Economic Survey said it contained 3.5 trillion cubic feet of natural gas.
The Nargis block is one of four offshore sites where U.S. energy giant Chevron holds mineral rights. Egypt's vast natural gas facilities in the Mediterranean have remained largely unused since the country's 2011 uprising that toppled longtime ruling autocrat Hosni Mubarak. But in recent years, the government of President Abdel Fattah El-Sisi has rehabilitated and upgraded the facilities.
In 2018, Egypt signed a $15 billion deal with Israeli company Delek Drilling and its U.S. partner, Noble Energy, to transport natural gas there. Cairo is thus aiming to position itself as an energy hub, and the new Nargis discovery is expected to contribute to these efforts.
Chevron is also a partner in Israel's Tamar natural gas reservoir, located about 90 km west of the northern Israeli city of Haifa. Last week, the operating partners announced that they had approved a final investment decision needed to proceed with the first phase of natural gas production expansion from the Tamar field to meet growing domestic demand and boost exports to Egypt.
The U.S. multinational energy company provided details of a two-stage plan to increase production to about 1.6 billion cubic feet of natural gas from the Tamar field to meet Israel's energy needs and export gas to Egypt and neighboring countries.
In June, Israel, Egypt and the European Union signed a memorandum of understanding that will see Israel export its natural gas to Europe for the first time. The landmark agreement will increase sales of liquefied natural gas to EU countries, which aim to reduce their dependence on supplies from Russia after its invasion of Ukraine. Under the terms of the agreement with the EU, Israel will send gas via Egypt, which has facilities to liquefy it for export.