27 August 2013, News Wires – Dana Gas is targeting further project investments to ramp up production in Egypt, despite the volatile political situation, as it eyes a settlement on outstanding receivables with the government.
The UAE-based company is looking to invest in a multi-well appraisal effort, the installation of gas compression facilities at its El Basant field and construction of a new pipeline linking its Salma and Tulip finds to the El Wastani plant.
It now believes a successful resolution is in sight on the issue of pending receivables to the tune of $270 million, which would enable it to carry out the investments.
The company said in a statement it is in positive talks with the Egyptian authorities “on its capital expenditure plans aimed at further increasing production and at resolving the issue of outstanding payments” adding it expects “an early resolution”.
Dana, which has invested $2 billion in the Middle East country to date, is looking to raise its Egyptian output to 50,000 barrels of oil equivalent per day in the near future, having recently hit a new record level of 41,500 boepd.
The company said in a statement that its core upstream operations in the Nile Delta, as well as the Egyptian Bahrain Gas Derivatives Company natural gas liquids extraction plant in Ras Shukheir, remained “safe and stable” amid recent fatal demonstrations in Cairo over a military coup that removed President Mohamed Morsi that have threatened to destabilise the country.
“Egypt remains a core part of our long-term strategy and we remain committed to enhancing production and developing our assets in Egypt,” said country general manager and incoming Dana Gas chief executive Patrick Allman-Ward.
The company said it has 1000 staff in the country, including those engaged in its WASCO joint venture with state-owned Egyptian General Petroleum Corporation.
Oil and gas operations have so far not been affected by recent violence, which came to a head with the alleged massacre by the Egyptian military of hundreds of supporters of Morsi’s ousted Muslim Brotherhood, whose leader has now been arrested on charges of incitement to riot.
However, major player BG Group pulled out 100 expatriate staff and their dependents last month, while BP and partner Shell temporarily closed their local offices and restricted travel into the country earlier this month.