Egypt Daily News – The Ministry of Petroleum and Mineral Resources in Egypt has announced a new initiative linking oil exploration companies’ earnings to production rates, aimed at boosting current production levels.
This was highlighted during a meeting between Minister Karim Badawy and TotalEnergies CEO Patrick Pouyanné, where they discussed the settlement of the company’s dues.
The initiative includes a fresh package of incentives, which establishes mechanisms tied to increasing production beyond existing levels. This is designed to allow a portion of the additional revenues from increased output to be allocated toward settling outstanding payments to partners.
Minister Badawy noted the ministry’s progress in implementing new payment mechanisms in recent months, ensuring regular fixed payments to sustain financial commitments to partners.
Additionally, Pouyanné discussed TotalEnergies’ recent partnership with ADNOC aimed at enhancing the production, distribution, and export of lubricants and petroleum products in Egypt and across Africa.
Despite initial plans for Egypt to emerge as a major gas exporter following the discovery of the significant Zohr offshore field by Eni in 2015, local gas production has been on the decline since 2021, hitting its lowest point in six years in May. This situation has forced Egypt to return to the liquefied natural gas market to meet domestic demands.
In the first half of this year, the Zohr field’s average production stood at 1.9 billion cubic feet per day, significantly lower than its peak in 2019, prompting discussions about potential technical issues and a slowdown in investment in the field. In response to these challenges, Eni has committed to enhancing gas production rates at the Zohr field by early next year.
