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MENA news roundup

The Middle East and North Africa (MENA) has for a long time been one of the main oil and gas-producing areas of the world. This has not changed, but there have been a number of developments that are altering trade across the region.

New hydrocarbon fields are being uncovered in Egypt and Oman, while other oil and gas projects are being planned in Iran. International trade is a main focus as well, with a new deal being signed between Russia and Egypt and exports from Kuwait to China increasing significantly. Read on for more news from this region:

 

Up to 15 bcm of gas discovered in Egypt

The area of Western Abu Madi in Egypt, located around 120 km north-east of Alexandria, has been found to contain significant reserves of natural gas. Italian firm Eni has announced that it believes the area could hold up to 15 billion cubic metres (bcm) of the resource, and that it plans to start gas production in just two months.

Egypt has a $2 billion energy exploration deal with Eni - whereby Eni holds 75 per cent of exploration rights through an Egyptian subsidiary and BP holds the remaining 25 per cent - which was signed in June of this year. This natural gas find marks the success of that agreement, with Eni drilling down to approximately 3,600 m to make the discovery.  

 

Iran planning $185bn of oil and gas projects

Iran has made a deal with several world powers to put a halt to its nuclear deal in exchange for the lifting of economic sanctions, and it has announced that once this occurs it will launch a huge number of oil and gas projects by 2020. In total, Iran estimates that these will be worth around $185 billion.

This was announced by Iran's deputy oil minister for commerce and international affairs, Hossein Zamaninia. He pointed to almost 50 different projects that the nation was aiming to work on once sanctions were lifted. In preparation, Mr Zamaninia commented that Iran had created a new model contract: the Integrated Petroleum Contract (IPC).

Deals made under the IPC would typically last longer than before, ideally for 20 to 25 years. "This model contract addresses some of the deficiencies of the old buyback contract and it further aligns the short and long-term interests of parties involved," Mr Zamaninia added.

 

Rosneft sending LNG to Egypt

Russian oil giant Rosneft has signed a contract to supply Egypt with liquefied natural gas (LNG) for the next two years. In total, 24 cargoes of this resource are to be transported to Egypt over this period. With a typical tanker holding between 145,000 and 155,000 cubic metres of LNG, this equates to roughly 3.5 to 3.7 million tons in total.

The agreement was signed between Rosneft and the Egyptian Natural Gas Holding Company. In a statement, Rosneft said: "Egypt has the highest demand for gas in Africa and is currently actively importing gas for domestic consumption." It added that the deal would "allow Rosneft to access the high growth potential Egyptian gas market and deepen broader cooperation between the two companies".

 

Kuwaiti oil exports to China triple

Government data released by Kuwait has revealed that the nation has dramatically increased the amount of oil that it exports to China. In June, 921,000 tons of oil were shipped from Kuwait to China, which is an increase of 205.9 per cent compared to June 2014. This is the equivalent of 225,000 barrels of oil arriving in China every day.

This is tied into a general increase in Chinese oil imports, as the nation received an average of 7.21 million barrels per day in June. While Kuwait increased its exports dramatically, it still doesn't come close to China's main supplier. That accolade goes to Saudi Arabia, which shipped an average of 1.3 million barrels per day to the nation.

 

Oman oil block showing potential

Block 60, an oil concession located in central Oman, is being explored by Oman Oil Company Exploration and Production (OOCEP). The firm has announced that it has experienced continued progress, with the 1,580 sqkm concession having a lot of potential.

The block contains the Abu Butabul gas field, but OOCEP believes there is significant potential for further hydrocarbon discoveries in the area. Originally it intended to construct four or five wells in the area, but it has now stated that it is "likely to further expand" this estimate.


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