• In 2015, Naftogaz continued to develop its overseas investment projects, namely the Alam El Shawish Western Desert Project in the Western Desert and investment projects within blocks of the South Wadi El-Mathareeth and Wadi El-Mathareeth in the Eastern Desert of Egypt.

    ALAM EL SHAWISH WESTERN DESERT PROJECT

    This project has been implemented since 2007 as a part of a concession agreement for oil exploration between Naftogaz, the Arab Republic of Egypt, and the Egyptian General Petroleum Corporation (EGPC). Since 2012, the project has included the joint venture Petrosannan Company, formed by Naftogaz and EGPC with equal shares in the company capital.

    On 26 November 2015, an agreement on gas sales was signed between Naftogaz and EGPC that allowed the company to receive funds for gas supplies which commenced in September 2014.

    During 2015, six wells were constructed. Drilling of 19 384 meters was completed, 5% more than in 2014. Average speed of the drilling was 54.3 meters per day.

    Concessions of Naftogaz

    Production of commercial oil and condensate amounted to 2.3 million barrels (318 thousand tons), which is 20.7% more than in 2014. Commercial gas production amounted to 192 mcm of gas, 378% more than in 2014.

    Over the entire duration of the project, as of 1 January 2016, 49 wells were drilled, of which 37 proved to be productive. In total, 7.686 million barrels of oil (1.046 million tons) and 243 million cubic meters of gas were extracted.

    Concession agreementsIn 2015, construction of an 18 km inter-industrial pipeline was started from the field HG to field E6 (undergoing trials as of June 2016). In order to optimize costs for production equipment, preparatory work began on the construction of two inter-industrial pipelines that will allow to involve the HG oil treatment station to service four fields simultaneously.

    Total recoverable reserves (probable and confirmed — 2P) amounted to 1 132 thousand tons of oil and 599.6 million cubic meters of gas (8.2 million barrels of oil and 21.2 billion cubic feet of gas), based on Ryder Scott Company independent evaluation as at 1 January 2015.


    SOUTH WADI EL-MATHAREETH AND WADI EL-MATHAREETH INVESTMENT PROJECTS

    In 2015, Naftogaz invested USD 5.7 million in exploration works within the framework of the concession agreement to conduct exploration and development of hydrocarbon fields at Wadi El-Mathareeth and South Wadi El-Mathareeth blocks located in the Eastern Desert of Egypt. The agreement was concluded in 2012 between the Arab Republic of Egypt (hereinafter — Egypt), Ganoub El-Wadi Holding Petroleum Company and Naftogaz subsidiary Zakordonnaftogaz.

     

    Currently, the project is at the first phase of exploration and the activities focus primarily on tests and exploration of hydrocarbon reserves.

     

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