Royal Dutch Shell, RWE and TransGlobe Energy have won concessions in Egypt’s first licensing round since the 2011 revolution as international oil firms bet that current payment difficulties can be overcome.
Egypt’s cash-strapped government owed foreign energy producers at least $3 billion in September, industry sources said, raising doubts about future investment in the oil sector.
The biggest winners were Canada’s TransGlobe with four concessions and Royal Dutch Shell with three concessions including one via an Egyptian joint venture, the companies said.
“We are continuing to invest and Egypt is continuing to find ways to make payments to us,” said Albert Gress, vice president of business development at TransGlobe Energy, on the sidelines of the North Africa Oil and Gas Summit.
He added that the company could start producing in the new blocks in 2014.
RWE and a joint venture between Dana Petroleum DANPJ.UL, Petroceltic International (PCI.I: Quote) and Beach Petroleum were also awarded one license each, the companies said.
The new licenses have not yet been confirmed by the Egyptian government.