The Old Clap
British Petroleum (BP) and Abu Dhabi National Oil Company (ADNOC) announced in a joint press release their agreement to form a joint venture that will develop natural gas fields in Egypt.
What
The agreement dictates that BP will offer its ownership in exploration and development concessions to the joint venture in exchange for ADNOC’s funding. While BP will own 51% of the joint venture, ADNOC should get 49%.
Claps Class – Concessions
In this context, a concession is a contract granted by a government to a company, allowing them exclusive rights to explore, develop, produce, or sell natural gas extracted from a specific area or field.
So What
The joint venture should increase Egypt’s gas production, and due to the concessions involved, will involve collaboration with state-owned companies.
Breakdown of Concessions
- North El Fayrouz, North El Tabya, and Bellatrix-Seti East exploration agreements
- Shorouk which contains Zohr field and is operated by Belayim Petroleum (Petrobel) – BP owns 10%
- North Damietta which contains Atoll field and operated by Pharaonic Petroleum Company (PhPC) – BP owns 100%
- North El Burg which contains underdeveloped Satis field and operated by PhPC – BP owns 50%
Now What
The joint venture will be formed in the second half of this year after it gets all the necessary regulatory approvals and clearances.
