The agreements will boost production in the Mediterranean and Suez Gulf. (Image source: Adobe Stock)

Egypt’s Minister of Petroleum and Mineral Resources, Karim Badawi, has signed agreements to boost oil and gas production with Shell Egypt and Cheiron Energy to boost oil and gas production in the Mediterranean and Suez Gulf

The minister, Shell Egypt’s vice president and country chair Dalia El Gabry, and Egyptian General Petroleum Corporation (EGPC) chairman Alaa El Batal have signed an agreement between EGPC, Shell and Malaysia’s Petronas to invest US$222mn in the 10th phase of gas production in the West Delta Deep offshore area to boost production. It will involve the drilling of three wells to produce natural gas and establish marine facilities to bring the wells into production.

Before the signing, Badawi and El Gabry held a meeting where the Minister stressed the government’s commitment to working with Shell, a key player in Egypt’s energy sector, to increase gas production in the Mediterranean, while El-Gabry confirmed Shell’s commitment to Egypt and its plans to invest in new exploration and production projects.

The minister also met with a delegation from Cheiron Energy and signed a US$120mn deal with the company and KUFPEC to boost oil production in the Suez Gulf. The agreement includes drilling nine wells in the Geisum and Tawila West area in the Suez Gulf, including three exploration wells. It is envisaged that the investment will increase oil and gas production in the Gulf of Suez from 21,000 bpd to 26,000 bpd.

The value of the two offshore projects together amounts to US$500mn. (Image source: Adobe Stock)

Saipem has been awarded two offshore projects in Saudi Arabia, under the existing Long-Term Agreement (LTA) with Saudi Aramco, together amounting to US$500mn

Saipem’s scope of work under the first project involves the Engineering, Procurement, Construction and Installation (EPCI) of a crude trunkline of approximately 50 km with a diameter of 42” for the Abu Safa Field, while the activities related to the second project involve the production maintenance programmes of the Berri and Manifa Fields.

Following the abandonment of its 13mn bpd maximum sustainable capacity (MSC) target earlier this year, Aramco is scaling back new greenfield projects, but is continuing with its already announced crude oil increment and maintenance projects to maintain MSC at 12mn bpd.

The award of these projects further boost Saipem’s strong position in the Middle East, where it won several contracts with Aramco and ADNOC last year. In January this year Saipem announced that it had completed the South Gas Compression Plant Pipelines project, designed to increase the life of a large number of gas wells in the Haradh & Hawiyah fields in Saudi Arabia. The scope of work involved the procurement and construction of around 700km of pipelines. In October 2023, Saipem, with NPCC, netted a US1.4bn contract with ADNOC, for the Hail and Ghasha development project.

ESTIDAMA will extend the UAE’s natural gas pipeline network operated by ADNOC Gas from approximately 3,200 km to more than 3,500 km. (Image source: Adobe Stock)

ADNOC Gas plc has awarded US$550mn worth of engineering, procurement & construction (EPC) contracts for the next phase of the ESTIDAMA Project, the UAE sales gas pipeline network expansion

The contracts were awarded to NMDC Energy P.J.S.C and Galfar Engineering & Contracting W.L.L Emirates.

Ownership of ESTIDAMA is being transferred from ADNOC Gas to ADNOC, thereby significantly optimising ADNOC Gas’ capital efficiency. ADNOC Gas will be paid to operate and maintain ESTIDAMA on behalf of  ADNOC and will continue to expand its domestic business through ESTIDAMA, paying ADNOC a transmission fee for actual throughput of the pipeline.

Expanding the network

ESTIDAMA will extend the UAE’s natural gas pipeline network operated by ADNOC Gas from approximately 3,200 km to more than 3,500 km, enabling the transportation of higher volumes of natural gas to customers in the Northern Emirates of the UAE. Following the ownership transfer, ADNOC Gas will continue to manage ESTIDAMA, while ADNOC will cover the capital expenditures for the project.

Dr. Ahmed Alebri, chief executive officer of ADNOC Gas, said, “This award supports the ongoing expansion of the UAE’s gas pipeline network, which will bring lower-cost and sustainable natural gas to more locations across the country. We are proud to play a leading role in meeting the growing demand for gas across the country and enabling the UAE’s goal of gas self-sufficiency. With the transfer of ownership of the ESTIDAMA Project to ADNOC, ADNOC Gas will continue to benefit from the expansion of the pipeline networks, while improving our capital efficiency to ensure that we maximise value for our shareholders.”

ADNOC is investing heavily in gas expansion, given the role gas can play as a lower-carbon transition fuel. ADNOC’s Ruwais LNG project is also making headway, and will more than double ADNOC’s UAE LNG production capacity, supporting the company’s global LNG ambitions.

Aramco is aiming to grow sales gas production by more than 60% by 2030, compared to 2021 levels. (Image source: Aramco)

Aramco has awarded contracts worth more than US$25bn to progress gas expansion, relating to phase two development of the Jafurah unconventional gas field, phase three expansion of Aramco’s Master Gas System, new gas rigs and ongoing capacity maintenance

Aramco's strategic gas expansion plan will see  sales gas production growing by more than 60% by 2030, compared to 2021 levels.

Jafurah development

Aramco has awarded 16 contracts, worth a combined total of around US$12.4bn, for phase two development at Jafurah, involving construction of gas compression facilities and associated pipelines, expansion of the Jafurah Gas Plant including construction of gas processing trains, and utilities, sulfur and export facilities. It will also involve construction of the Company’s new Riyas Natural Gas Liquids (NGL) fractionation facilities in Jubail — including NGL fractionation trains, and utilities, storage and export facilities — to process NGL received from Jafurah.

The Jafurah unconventional gas field is estimated to contain 229 trillion standard cubic feet of raw gas and 75bn Stock Tank Barrels of condensate. Initial start-up anticipated in the third quarter of 2025, with production expected to reach a sustainable sales gas rate of two billion standard cubic feet per day (bscfd) by 2030, in addition to significant volumes of ethane, NGL and condensate.

Another 15 lump sum turnkey contracts, worth a combined total of around US$8.8bn, have been awarded for the phase three expansion of the Master Gas System, involving the installation of around 4,000km of pipelines and 17 new gas compression trains, which will increase the size of the network and raise its total capacity by an additional 3.15 bscfd by 2028.

An additional 23 gas rig contracts worth US$2.4bn have also been awarded, along with two directional drilling contracts worth US$612mn and 13 well tie-in contracts at Jafurah, worth a total of US$1.63bn.

Amin H. Nasser, Aramco president & CEO, said, “These contract awards demonstrate our firm belief in the future of gas as an important energy source, as well as a vital feedstock for downstream industries. The scale of our ongoing investment at Jafurah and the expansion of our Master Gas System underscores our intention to further integrate and grow our gas business to meet anticipated rising demand. This complements the diversification of our portfolio, creates new employment opportunities, and supports the Kingdom’s transition towards a lower-emission power grid, in which gas and renewables gradually displace liquids-based power generation.”