Production started Wednesday at the giant Zohr natural gas field off the coast of Egypt, one of the largest fields in the world. Photo courtesy of Eni
Dec. 20 (UPI) -- The Egyptian energy sector will be transformed now that production started at the Zohr gas field, one of the biggest in the world, Italy's Eni said Wednesday.
Production started at the Mediterranean gas field less than two years after the company declared its initial commercial discovery, which Eni said was a record for a deep-water field like Zohr.
Third quarter production for Eni averaged 1.8 million barrels of oil equivalent per day, up about 5.4 percent from the same period last year. Start ups and plans to ramp up production in the fourth quarter could bring that level to around 1.9 million boe on average, the highest level for Eni in seven years.
By October, it was already anticipating a breakthrough at its Zohr gas field in Egypt.
"It will completely transform Egypt's energy landscape, allowing it to become self-sufficient and to turn from an importer of natural gas into a future exporter," CEO Claudio Descalzi said in a statement.
Zohr is the largest gas discovery ever made in Egyptian waters. About 120 miles offshore, the field holds about 5.5 billion barrels of oil equivalent.
Egypt in late 2016 secured a three-year, $12 billion loan from the International Monetary Fund to help facilitate inclusive growth. The IMF said the government in Cairo was making progress on much needed reforms, though subsidies at the consumer level already on the table for energy were not crafted wisely and benefit mostly those above the poverty level.
The IMF, however, said the economic potential for Egypt is "immense" and significant investments in the energy sector and major new natural gas discoveries are contributing to its potential.
Egypt aims to become a regional hub for gas and LNG, though availability at the domestic sector could complicate growth.
Early-year analysis from consultant group Wood Mackenzie said the Egyptian gas market "will be inundated" with new volumes from some of the recent discoveries in the Mediterranean Sea. Production levels could reach a record of 7.3 billion cubic feet per day within six years.