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Rosneft acquires Zohr stake

Written by  OE Staff Monday, 12 December 2016 03:18

Russia's Rosneft is to take a 30% stake in the Shourouk Concession, offshore Egypt, containing the supergiant Zohr gas field.

Rosneft will pay operator Eni US$1.125 million and a share of past expenditures, which amount so far at about $450 million. In addition, Rosneft has an option to buy a further 5% stake under the same terms.

Operator Eni, through its subsidiary IEOC, currently holds a 90% stake in the block, after selling a 10% stake to BP for $375 million, plus past costs. BP also has an option to take a further 5%. 

Thought to be the largest gas discovery made in the Mediterranean, Eni has estimated total gas resources in place in Zohr to be approximately 30 Tcf. The first phase of development of Zohr is being fast-tracked, with first gas expected in late 2017. 

According to IHS Energy, Zohr has the potential to supply much of Egypt’s increasing domestic gas demand and will likely have an impact on regional gas commercialization plans. In addition, the technical, commercial, and strategic implications of Zohr is estimated to impact Egypt, the region and the industry, where Egypt’s access to monetization infrastructure will likely put it ahead of rivals if commercial terms are right.

Eni has been present in Egypt since 1954 where it operates through IEOC Production. The equity production was about 200,000 boe/d in 2015.

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