LNG

The Egyptian Natural Gas Holding Co. (EGAS), the government-run energy company with stakes in Egypt’s two LNG export plants and other gas field assets, has established a subsidiary in Saudi Arabia to help attract more investment.

Egypt's Ministry of Petroleum said that the Saudi unit had been set up by EGAS with initial capital of 2 million Saudi riyals ($533,000).

The Egyptians said in their statement that EGAS would own 80 percent of the venture called “Modern Gas Saudi Arabia” and explained that it would be part of the Egypt’s strategy for offshore expansion in the East Mediterranean in cooperation with other Arab nations such as the United Arab Emirates.

EGAS has various stakes, direct and indirect, in Egypt’s expansive oil and gas assets and the two LNG export plants, Damietta and Idku, located east of the port city of Alexandria.

ADNOC-BP deal

Abu Dhabi National Oil Company (ADNOC) and UK major BP said in Mid-February 2024 that they planned to form a joint venture in Egypt that would initially focus on natural gas and incorporate Egyptian concession stakes held by BP.

That joint venture is expected to be formed in the second half of 2024 and will be 51 percent owned by BP and 49 percent by ADNOC.

The BP-ADNOC Egyptian joint venture was originally planned to be the second phase of cooperation between the two companies in the East Med gas and LNG province after the planned acquisition of a 50 percent stake in Israeli gas producer NewMed Energy.

Negotiations on the proposed NewMed agreement for BP and ADNOC started in March 2023, though have now been officially suspended.

As part of the agreement for Egyptian expansion and energy investment by ADNOC, BP will contribute its interests in three development concessions, as well as exploration agreements in Egypt to the new joint venture.

ADNOC will make a proportionate cash contribution which can be used for future growth opportunities.

Gas fields

This is the first major natural gas deal for BP under new Chief Executive Murray Auchincloss.

Both companies said that this new joint venture partnership would enhance Egyptian energy security and the economic potential of the region’s most populous Arab country.

The natural gas concession to be included in the Egyptian joint venture include BP’s 10 percent in the Shorouk block containing Egypt’s huge Zohr gas field.

BP’s 100-percent owned North Damietta interests are also included along with BP’s 50-percent stake in the North El Burg concession with the undeveloped Satis field.

Three other exploration concession included are North El Tabya, Bellatrix-Seti East and the North El Fayrouz block.

Chevron Corp., the operator of liquefied natural gas projects in Western Australia and Africa, said it expected a capital expenditure range of $15.5 billion to $16.5 billion and an affiliate spending budget of around $3Bln for 2024.

NewMed Energy, the Israeli natural gas company and LNG project developer in the East Mediterranean, said plans for the Aphrodite gas field offshore Cyprus are now focused on transportation of the gas by a pipeline to LNG processing facilities in Egypt.

UK major BP more than doubled annual profits, though was hit by slowing natural gas prices during the fourth quarter and expected a flat 2023 with among the main highlights being the start-up of two LNG projects in West Africa and Indonesia.

Chevron Corp. more than doubled net income in 2022 as oil and gas sales increased at higher prices and LNG export demand soared in the Atlantic and Pacific basins.

Chevron reported annual net income of $35.60 billion for the upstream and downstream divisions combined compared with $15.68Bln in the previous year as well as posting higher quarterly earnings.

For the fourth quarter, Chevron registered $6.37Bbln of profits versus $5.08Bln in the same three months of 2021 to the end of December.

Revenues in 2022 increased by 52 percent to $246.25Bln compared with $162.46Bln in the previous year from key assets in areas such as the Permian Basin, the Eastern Mediterranean and LNG export projects such as Gorgon and Wheatstone in Western Australia and Angola LNG in southwest Africa,

Fourth-quarter revenues jumped to $56.47Bln from $48.13 in the prior-year quarter.

“We delivered record earnings and cash flow in 2022, while increasing investments and growing US production to a company record,” said Mike Wirth, Chevron’s Chairman and Chief Executive.

US production

“The company’s investments increased by more than 75 percent from 2021, and annual US production increased to 1.2 million barrels of oil equivalent per day, led by 16 percent growth in Permian Basin unconventional production,” explained Wirth.

The San Ramon, California-based company said worldwide net oil-equivalent production was 3.01 million barrels per day in the fourth quarter 2022 and 3.00 million barrels per day for the full-year 2022.

Chevron added 1.1 billion barrels of net oil-equivalent proved reserves during last year.

“The largest net additions were from assets in the Permian Basin, Israel, Canada and the Gulf of Mexico” added Chevron.

The company also raised its quarterly dividend per share an additional 6 percent, to $1.51 per share, putting the company on track to increase its annual per share dividend for the 36th straight year.

In addition, the company’s board approved a new $75Bln share repurchase program.

Quarterly highlights

“We are well positioned to lead in both traditional and new energy businesses, while delivering higher returns, lower carbon and superior shareholder value,” declared Wirth.

Among Chevron’s quarterly highlights, the company listed the taking of final investment decisions on major integrated chemicals projects in Texas and Qatar for the company’s 50 percent owned affiliate, Chevron Phillips Chemical Company LLC.

Chevron also approved a project to expand the Tamar gas facility offshore Israel.

It additionally announced a “significant” new natural gas discovery at the Nargis block in the East Med offshore Egypt.

The US major is also going forward with the Ballymore project in the deepwater US Gulf of Mexico with design capacity of 75,000 barrels of crude oil per day.

Chevron increased it carbon-reduction plans with multiple carbon-capture projects, including the Bayou Bend storage project in the US Gulf Coast. It also received permits to assess carbon storage offshore Australia.

The third ministerial meeting of energy ministers is taking place of the 42-nation Union for the Mediterranean (UfM) and what is the biggest regional gathering of natural gas and LNG importers, exporters and developers.

Italian company Eni, one of the biggest energy players in Egypt, said it was trying to find an agreement to allow the restart of the idled Damietta LNG export facility, located east of Alexandria, and one of two Egyptian liquefaction facilities on the East Mediterranean coast.

Delek Group, a stake holder in the East Mediterranean Tamar and Leviathan natural gas fields supplying Egypt, Israel and Jordan increased revenues by 88 percent and boosted operating income.

Greece, Cyprus and Israel have signed an agreement to build a 1,900-kilometre subsea pipeline to transport natural gas from the East Mediterranean to West European markets in competition to LNG.

ExxonMobil and Qatar Petroleum, the leading global liquefied natural gas stakeholders, have made a large natural gas discovery offshore Cyprus in the Eastern Mediterranean, opening more prospects for regional LNG production.