With another natural gas field starting up, Egypt has moved closer to once again becoming self-sufficient, but LNG imports are likely to continue until the end of the year.
London-based BP announced this week the launch of the Atoll gas field in the East Nile Delta, which started producing seven months ahead of the initial plan and less than two months after Italy’s Eni announced the start of production from the giant Zohr field.
Atoll is a smaller field, with a potential 1.5 trillion cubic feet (tcf) of gas in reserves, while Zohr holds more than 30tcf of gas.
“The Atoll field is a reasonably significant addition to the trend of growing domestic gas production in Egypt, but on its own it would only have a limited impact,” said Andy Flower, an independent LNG consultant.
Gas production from the field is directed to Egypt’s national grid.
The field is producing around 10 million cubic (mcm)/day, according to BP.
Zohr also started production with 10mcm/day, according to Egypt’s oil ministry. But production was expected to ramp up to around 54mcm/day throughout 2018 and in 2019 output should be around 80mcm/day, Eni said.
Egypt consumed 51.3 billion cubic metres of gas in 2016, according to latest BP statistical review of world energy. This amounts to around 141mcm/day, with a stable rise in consumption every year.
The pattern of Egypt’s LNG imports is changing fast. But the deadline for halting LNG supplies by the middle of this year set by the government last month still looks ambitious.
“But certainly by the end of the year Egypt should become self-sufficient. One [floating storage and regasification unit] FSRU will probably be released but they may keep one available for a time as a backup,” Flower said.
Since the start of 2018, Egypt has received five LNG cargoes, with one more expected next week. Over the same period last year, 15 cargoes were delivered to the country. Egypt is expected to require LNG supply for the second quarter of this year, but no tender has yet been issued.
Egypt’s LNG exports from the Idku plant have ramped up over the past year and the plant is expected to increase production as more gas is produced.
In contrast, the Damietta export plant that was shut in 2012 will require time to relaunch.
In the future, Damietta may also potentially be used for exports of gas produced in Cyprus.
Last week, Eni announced a gas discovery offshore Cyprus. “Calypso 1 is a promising gas discovery and confirms the extension of the “Zohr-like” play in the Cyprus Exclusive Economic Zone,” said Eni, which discovered the gas reservoir with France’s Total..
Cyprus also possesses the Aphrodite gas field off its southern coast owned by Israeli company Delek Drilling, Noble Energy, and Shell, with the majority of the gas potentially going for export due to low domestic gas consumption.
“In Cyprus, there now appears to be enough gas for a reasonably-sized liquefaction plant,” Flower said.
“To export LNG from Calypso via Damietta in Egypt would probably be the lowest cost option. But making that happen could be difficult because it will involve using gas production from another country to supply an LNG plant.“ firstname.lastname@example.org