Cairo — Egypt has signed four oil and gas exploration agreements worth more than $340 million, marking a renewed push to revive its struggling hydrocarbon sector and offset a steep decline in production that has strained both the economy and domestic energy supplies.
The state-owned Egyptian Natural Gas Holding Company (EGAS) confirmed the deals on Friday, outlining investments that will fund the drilling of ten new wells in the Mediterranean and the Nile Delta. Officials say the move is designed to reposition the country as a regional hub for energy development while stabilizing output that has faltered in recent years.
The contracts span partnerships with a mix of international players. Shell committed $120 million to drill three wells in the offshore Merneith block, while Italy’s Eni pledged $100 million for exploration in East Port Said. Arcius Energy, a joint venture of BP and Abu Dhabi’s ADNOC, will invest $109 million to expand operations in North Damietta, one of the most strategically significant offshore areas. Russia’s Zarubezhneft secured a $14 million agreement to drill four wells in the North El-Khatatba block of the Nile Delta, underscoring Moscow’s growing energy presence in Egypt.
The investments arrive as Cairo grapples with dwindling natural gas production, which in May fell to 3.5 billion cubic meters, down more than 40 percent from early 2021 levels. Analysts note that aging fields and delayed project financing have left Egypt increasingly dependent on costly LNG imports and controversial gas deals with Israel, a reliance that has provoked public anger amid the Ongoing Genocide in Gaza.
By partnering with Western majors, Gulf-backed ventures, and Russian energy firms, Egyptian officials aim to balance foreign capital with geopolitical diversification. “These agreements show Egypt is still open for business,” one senior energy analyst in Cairo said. “But the deeper question is whether these new wells will be enough to arrest the long-term decline in output.”
The government hopes the deals will also reassure lenders and investors, particularly as Cairo navigates high inflation, currency devaluation, and the pressures of IMF loan conditions. At the same time, the choice to deepen cooperation with Moscow’s Zarubezhneft highlights Egypt’s effort to avoid total dependence on Western energy giants while cultivating ties with Russia and Gulf allies.
According to Asharq Al-Awsat, the agreements collectively underline Egypt’s strategy of securing fresh exploration activity in both offshore and onshore zones, with the expectation that discoveries could stabilize the country’s energy balance in the coming years.
