QatarEnergy has signed a deal with Anglo-Dutch supermajor Shell to come on board two exploration blocks offshore Egypt in the Red Sea.
Under the terms of the agreements, which are subject to customary approvals by the government of Egypt, QatarEnergy will hold a 17% working interest in blocks 3 and 4, the state-owned giant said in a statement on Monday.
Qatar has been aggressively expanding its international exploration portfolio through multiple farm-in deals, mostly focused on offshore tracts.
QatarEnergy chief executive Saad Sherida Al Kaabi said the new acquisition represents the company’s “entry into the Arab Republic of Egypt’s well-established upstream oil and gas sector and offers an opportunity for the consortium partners to explore this frontier acreage.”
Tracts on offer
Block 3 was awarded to Shell in 2019 and covers an area of almost 3097 square kilometres in water depths ranging between 100 metres and 1000 meters.
Block 4 was awarded to Shell in the same year and covers about 3084 square kilometres in water depths of 150 metres to 500 metres.
After the conclusion of the farm-in deal, Shell would continue to be the operator of Block 3 with a 43% stake, while Australia's BHP - whose oil and gas business is being acquired by Woodside - will hold 30%.
Egyptian player Tharwa Petroleum will control a 10% interest while QatarEnergy will hold a 17% stake.
For Block 4, Shell will have a 21% operating stake, UEA-based Mubadala will be on 27%, with BHP controlling 25%, Tharwa Petroleum on 10% and QatarEnergy at 17%.
International energy giants have been flocking to the Egyptian exploration sector, with several awards placed earlier this year.
ExxonMobil, TotalEnergies, Shell and Chevron are some of the key players that signed up to nine oil and gas exploration deals earlier in 2021, worth more than $1 billion, involving acreage in the Mediterranean and Red Seas.
The country’s Petroleum Minister Tarek al-Molla earlier said exploration deals were inked with six companies to drill a total of 17 wells.
The nine new deals were a part of 12 new agreements that have been targeted since March last year with minimum investment pegged at $1.4 billion for drilling 23 wells, nine of them in Mediterranean waters and three in the Red Sea.