Energy giants Adnoc and BP have agreed to form a joint venture in Egypt that will focus on natural gas.
The JV, in which UK-based BP will have 51 percent and UAE’s Adnoc 49 percent, will combine the pair’s “deep technical capabilities and proven track records as it aims to grow a highly competitive gas portfolio,” according to a statement by Adnoc.
As part of the agreement, BP will contribute its interests in three development concessions, as well as exploration agreements, in Egypt to the new JV.
Moreover, Adnoc will make a proportionate cash contribution which can be used for future growth opportunities.
The concessions which will be added to the JV include Shorouk, operated by Belayim Petroleum (Petrobel), and BP has 10 percent interest in this concession which contains the producing Zohr field.
Also, the concessions include North Damietta, operated by Pharaonic Petroleum (PhPC), and BP owns 100 interest interest which contains the producing Atoll field, as well as North El Burg, operated by PhPC. BP has 50 percent interest in this concession which contains the undeveloped Satis field.
North El Tabya, Bellatrix-Seti East, and North El Fayrouz exploration concession agreements will be also added to the JV.
Completion targeted in H2 2024
Adnoc said it expects the formation of the incorporated JV to complete during the second half of 2024, subject to regulatory approvals and clearances.
Musabbeh Al Kaabi, Adnoc executive director for low carbon solutions and international growth, said today’s announcement with BP represents a “significant step forward as Adnoc builds its international natural gas portfolio.”
Adnoc launched its gas and LNG unit, Adnoc Gas, on January 1, 2023 as it looks to further expand its international presence.
“This progressive joint venture partnership will enhance Egyptian energy security and the economic potential of the region’s most populous Arab country,” Al Kaabi said.
BP’s William Lin, executive VP of regions, corporates & solutions, said this “dynamic JV offers a platform for international growth that advances our longstanding and strategic partnership with Adnoc that spans over five decades.”
The cooperation includes LNG as BP has a 10 percent stake in Adnoc LNG, the operator of the liquefaction and export terminal on Das Island in the Persian Gulf.
Egypt is an LNG exporter and hosts the Eni-led Damietta liquefaction plant and the Shell-led Egyptian LNG export terminal (ELNG) in Idku.
“Together, we will build on the 60 years of safe and efficient operations of BP and its partners in Egypt, and continue to produce and deliver secure, lower-carbon energy in the form of natural gas to the country,” Lin said.
