New Energy market report from Business Monitor International: "Egypt Oil & Gas Report Q4 2013"
Boston, MA -- (SBWIRE) -- 11/22/2013 -- Political and social instability have disrupted Egypt's hydrocarbon potential. While operators tend to have the ability to work through political risk, security concerns have prompted force majeure measures, disrupting operations. At time of writing, political risks in Egypt have peaked and security concerns have eased; BMI's Country Risk analysts expect a slight moderation over the rest of the year. We believe that operational risk and lack of policy certainty will affect the country's output for the coming months and possibly years. However, we stress that the country's below ground potential remains extensive, as exemplified by a series of recent discoveries in onshore and offshore concessions. This leads us to believe that Egypt still holds large upside potential, but this will only be monetised over the long term as current woes are alleviated.
We highlight the following trends and developments in Egypt's oil and gas sector:
- A series of recent discoveries by Beach Energy and Apache in their Western Desert concessions and BP Egypt in the deepwater East Nile Delta highlight that below ground potential remains promising.
- We see serious downside risk to our production forecasts for 2013 and 2014 as companies are likely to reduce their exposure to operational risks. Both BG and BP have already announced reductions in their activities. Apache also divested 33% stake in its Egyptian business to Sinopec, for US$3.1bn, reducing its exposure to the country, which - before the divestment - accounted for 20% of total production.
- In addition, U$6bn in unpaid debts to companies by EGAS and EGPC highlight the financial strains of the state owned energy companies. While a repayment schedule has been agreed to, it highlights an additional operational and financial risk operating in the country.
- While political risk is pertinent and certainly the main concern in the short term (at least until 2014 elections, but most likely after that as well), we see the domestic fuels pricing environment as a long term, persistent worry for foreign operators. With the country failing to reach an agreement with the IMF and to implement a rationalisation of its downstream market, producers as they face growing risk that output may be redirected to meet domestic demand rather than their contracted export obligations.
- Although gas production is expected to grow from 60 cubic metres (bcm) to 79bcm in the 2013-2022 period, consumption will rise at an ever more rapid pace, from 50bcm to 79bcm. Net gas exports, especially through liquefied natural gas (LNG), will fall over the forecast period as consumption increases sharply. We have downgraded our 2013 production and consumption forecasts to reflect a fall in gas production and fall in gas consumption (especially from the power sector).
View Full Report Details and Table of Contents
About Fast Market Research
Fast Market Research is an online aggregator and distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff will help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.
Browse all Energy research reports at Fast Market Research
You may also be interested in these related reports:
- InterOil Exploration & Production ASA Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Bankers Petroleum Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Falcon Oil & Gas Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Nexen Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Perpetual Energy Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- NuVista Energy Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Sonde Resources Corp. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Imperial Oil Limited Analysis Across the Oil and Gas Value Chain Report, 2013 Update
- Harvest Operations Corp. Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Global Oil and Gas Survey 2013-2014 - Market Trends, Marketing Spend and Sales Strategies in the Global Oil and Gas Industry