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Sunday, 15 January 2017

Egypt’s gas sector to change profoundly within five years

Egypt’s natural gas sector is “on pace for a profound change in the next five years,” consultant Wood Mackenzie says. “After swinging from the world’s eighth largest liquefied natural gas exporter in 2009 to the world’s eighth largest LNG importer in 2016, the wheel is set to turn again,” a report emailed to UPI found. Wood Mackenzie expects Egyptian gas production levels to increase to 7.3 bcf/d, leaving the market “inundated” following positive exploration results and higher gas prices. The report adds that the turnaround will be largely seasonal. “Better gas availability for domestic sectors — power especially — could exacerbate seasonality through the demand response … Our analysis suggests that over the production ramp-up period, seasonal LNG imports could be needed to cover demand in the peak summer months, while excess gas could be available for LNG exports in the winter.”

Read that with: IOCs are rethinking the Eastern Mediterranean region’s gas potential, according to analysis by IHS Markit carried by Offshore Energy Today. Interest in the region as a whole has grown with Total’s announcement that it will drill a 2017 exploration well in its deepwater Block 11 located offshore Cyprus. “Zohr’s success clearly encouraged Total leadership to re-examine Block 11’s potential, since it is contiguous with the Egyptian Shorouk Offshore Block, which is home to Eni’s Zohr Field,” senior director of plays and basins research at IHS Markit Graham Bliss says. He added: “If the Zohr carbonate play extends northward into Total’s Block 11, then the potential for a significant discovery in Block 11 exists … A major find would provide competition with offshore Israel gas fields to fulfill Egypt’s rising gas demand … could even potentially lead to gas exports to Turkey.” Bliss says the most likely outcome for a significant Block 11 discovery is exporting to Egypt.

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