Shell Egypt Chairman Jeroen Regtien stated on Friday that “Shell will not apply to any tenders for research and exploration in areas other than the Western Desert”.
The Ministry of Petroleum recently granted approvals for gas research and exploration in three new wells in Shell’s concession area in the Western Desert. Regtien’s remarks came during the Shell Technology Leadership Conference focusing on energy conservation, held on Friday in Hurghada.
“Shell Egypt will not work in deep water research and exploration after its experience in the Mediterranean, which cost us millions of dollars,” Regtien said.
Shell Egypt received a concession for gas exploration in the Mediterranean 11 years ago, but was unable to find sufficient quantities to achieve material returns to cover investment expenditures in the research and exploration operations. The company decided to abandon the concession and return it to the Egyptian government.
This month Shell will begin conducting a mini experiment to produce shale gas in the Apollonia region in the Western Desert in cooperation with Apache using advanced US technology to carry out the operations, according to Regtien.
Shell reached an agreement with the Ministry of Petroleum on shale gas pricing for which Shell will begin production trials soon, and the government is expected to release the details shortly.
Shale gas production trials in the Western Desert will continue for two to three years and then Shell will be able to make a decision on whether to expand in the field, Regtein said.
He added that Egypt should take advantage of agricultural waste and biomass to produce energy. Sugar cane has become an important source of fuel and electricity in Brazil, said Regtien, whilst pointing out that the situation in Egypt is different because it cannot convert agricultural land into energy crop production areas.
Regtien said: “We at Shell are moving firmly toward facing energy challenges and we have been one of the major international companies in the field of technological innovation for more than 100 years. We will continue to provide more solutions and technological innovations to meet energy market needs and innovate new sources of energy while producing more oil and gas from our existing fields.”