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LONDON (Alliance News) - BP PLC Thursday said it has signed a heads of agreement with authorities in Egypt which will allow the oil major to accelerate the development of the Atoll gas discovery in the country.
The offshore discovery was made in March and the agreement will allow BP to develop the resource at the discovery, estimated to have 1.5 million cubic feet of gas and 31.0 million barrels of condensate, to sell to the domestic market once production begins in 2018.
BP Chief Executive Bob Dudley said: "We are pleased to be making rapid progress towards the development of Atoll less than eight months after the announcement of its discovery. This is further demonstration of our continued confidence in Egypt ? a key growth area for BP ? and our commitment to continue to invest to unlock its energy potential."
Full field development of Atoll is expected to consist of two phases. The first phase will consist of two development wells tied back to existing infrastructure, with production expected to start up in 2018. Success of this first phase is expected to trigger additional investment and further wells to increase production.
BP also said it will continue to invest in its existing oil operations in Egypt led by its joint venture company Gulf of Suez Petroleum Co, and its gas operations led by its other joint venture company Pharaonic Petroleum Co. It will also continue to look for additional exploration opportunities in the Nile Delta region where the Atoll discovery lies.
The Atoll discovery was made under the Pharaonic joint venture, with EGAS and Eni being BP's partners in the joint venture company.
BP expects to sustain its current oil production and double its gas production in Egypt before the end of the decade to reach 2.50 billion cubic feet per day with partners, which represents more than 50% of Egypt?s current gas production.
BP shares were down 2.2% to 393.20 pence per share on Thursday afternoon.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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