TIDMBP.
RNS Number : 7632G
BP PLC
06 March 2015
press release
6 March 2015
BP Finalises Deal To Develop Egypt's West Nile Delta Gas
Fields
BP announces the signing of the West Nile Delta project to
develop 5 tcf of gas resources and 55 mmbbls of condensates
BP today announced that it has signed the final agreements of
the West Nile Delta project to develop 5 trillion cubic feet (tcf)
of gas resources and 55 million barrels (mmbbls) of condensates
with an estimated investment of around $12 billion by BP and its
partner. The project underlines BP's commitment to the Egyptian
market and is a vote of confidence in Egypt's investment climate
and economic potential.
Production from WND is expected to reach up to 1.2 billion cubic
feet a day (bcf/d), equivalent to about 25 per cent of Egypt's
current gas production and significantly contribute to increasing
the supply of energy in Egypt. All the produced gas will be fed
into the country's national gas grid, helping to meet the
anticipated growth in local demand for energy. Production is
expected to start in 2017.
"BP is proud of its record in Egypt over the past 50 years and
we are looking forward to many more years in the country. The WND
project investment is the largest foreign direct investment in
Egypt, and demonstrates our continued confidence in Egypt and our
commitment to unlock its energy potential. WND production is key to
Egypt's energy security," said Bob Dudley, BP Group Chief
Executive.
Gas will be produced from two BP-operated offshore concession
blocks, North Alexandria and West Mediterranean Deepwater. BP
believes that there is the potential through future exploration to
add a further 5-7 tcf which could boost WND production with
additional investments.
Commenting on the project, Hesham Mekawi, BP North Africa
Regional President said, "This is a critical milestone in the
Egyptian oil and gas history. It marks the start of a major
national project to add significant production to the domestic
market. BP expects to double its current gas supply to the Egyptian
domestic market during this decade when the WND project reaches its
peak production. BP will also continue to invest in our existing
oil operations at the Gulf of Suez (through GUPCO) and gas
operations in the East Nile Delta (through Pharonic Petroleum Co.),
as well as progressing our recently discovered resources to allow
for the next new major development after WND."
The scale of investment and activities of the WND project are
expected to significantly contribute to the growth of
petroleum-related industries and to Egyptian employment. During the
construction phase, the project is projected to employ thousands of
direct and indirect personnel. In line with BP's commitment to
support the development of Egyptian capability, the WND project
will encourage technology transfer and know-how through training
and on-the-job development. This will help to create strategic
national capabilities to unlock the country's future hydrocarbon
potential.
As part of the WND project, BP will also undertake a social
investment programme directed to various sustainable development
projects in coordination with the local communities and utilizing
local service providers.
This will be in addition to the project's principal approach,
which is focused on increasing local labour, with a commitment to
employ significant local labour during operations.
Notes to Editors
-- The West Nile Delta (WND) Major Project is a strategic
project for BP where BP has about 65 per cent equity in the project
partnership.
-- The WND project concept maximises the utilisation of existing infrastructure:
-- BP-operated Taurus/Libra fields: this will be a subsea
development tied-in offshore to existing BG-operated Burullus
facilities
-- The BP-operated Giza/Fayoum & Raven fields: These are two
deepwater long distance tie-backs to the shore, where the existing
Rosetta plant will be modified for Giza/Fayoum and integrated with
a new adjacent onshore plant for Raven.
-- BP has a long and successful track record in Egypt stretching
back 50 years with investments exceeding $25 billion, making BP one
of the largest foreign investors in the country. In Egypt, BP's
business is primarily in oil and gas exploration and
production.
-- BP has made a series of discoveries in Egypt in recent years
including Taurt North, Seth South and Salmon and Rahamat, Satis,
Hodoa, Notus and Salamat.
-- To date, BP Egypt, in collaboration with the Gulf of Suez
Petroleum Company (GUPCO), BP's joint venture (JV) Company with the
Egyptian General Petroleum Company (EGPC), has produced almost 40
per cent of Egypt's entire oil production, and currently produces
almost 10 per cent of Egypt's annual oil and condensate.
-- In addition, through joint ventures with EGPC/EGAS and IEOC
(ENI) the Pharaonic Petroleum Company (PhPC) and Petrobel BP
currently produces close to 30 per cent of Egypt's total gas.
-- BP is working to meet Egypt's domestic market growth by
actively exploring in the Nile Delta and investing to add
production from existing discoveries.
-- BP is a 33 per cent shareholder of an NGL plant extracting
LPG and propane, United Gas Derivatives Company (UGDC) in
partnership with ENI/IEOC and GASCO (the Egyptian midstream gas
distribution company).
-- BP is also present in the downstream sector through Natural
Gas Vehicles Company (NGVC, BP 40 per cent) which was established
in September 1995 as the first company in Africa and the Middle
East to commercialize natural gas as an alternative fuel for
vehicles.
Further enquiries:
BP Egypt office: +202 2519 9915
BP Press Office, London: +44 (0)207 496 4076, bppress@bp.com
Cautionary statement
This press release contains certain forward-looking statements
concerning BP's expectations regarding the signing of the West Nile
Delta mega project, including expectations regarding the volume of
gas and condensates to be developed; the estimated level of future
investment; the estimated level of daily production and the timing
of start-up thereof; prospects for future exploration, investment
and increased production; expectations regarding future demand in
Egypt and the project's contribution to gas supply; plans to
continue investment into existing oil operations and maximise use
of existing infrastructure in the region; expectations regarding
contributions to the growth of petroleum-related industries,
employment, the creation of strategic national capabilities and
future business in Egypt; and expectations regarding BP's social
investment program and labor plans. Actual results may differ from
those expressed in such statements, depending on a variety of
factors including changes in public expectations and other changes
to business conditions; the timing, quantum and nature of
divestments; the receipt of relevant third-party and/or regulatory
approvals; future levels of industry product supply; demand and
pricing; OPEC quota restrictions; PSA effects; operational
problems; regulatory or legal actions; economic and financial
conditions generally or in various countries and regions; political
stability and economic growth in relevant areas of the world;
changes in laws and governmental regulations; exchange rate
fluctuations; development and use of new technology; the success or
otherwise of partnering; the actions of competitors, trading
partners and others; natural disasters and adverse weather
conditions; changes in public expectations and other changes to
business conditions; wars and acts of terrorism, cyber-attacks or
sabotage; and other factors discussed under "Risk factors" in our
Annual Report and Form 20-F 2014.
This press release contains references to non-proved resources
and production outlooks based on non-proved resources that the
SEC's rules prohibit us from including in our filings with the SEC.
U.S. investors are urged to consider closely the disclosures in our
Form 20-F, SEC File No. 1-06262. This form is available on our
website at www.bp.com. You can also obtain this form from the SEC
by calling 1-800-SEC-0330 or by logging on to their website at
www.sec.gov
- ENDS -
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The company news service from the London Stock Exchange
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