Prospecting for New Life

Natural Gas is the Poor Cousin, no more ! Up till recent times, natural gas was considered the poor cousin among the family of primal energy sources. It is a deeply-rooted, strong-branched family and the throne of which was mounted by charcoal for a long time. In the 20th century, his highness "influential petroleum" came to share this throne. Despite international interest in developing alternative energy sources, such as water falls, wind and solar power, as well as nuclear energy, the contribution of the alternatives proved to be highly expensive and highly restricted as regards international consumption of energy.

Yet in less than two decades the world gradually discovered an important alternative in the environment; the least polluting fuel, with extremely high thermo content of unique conductive physical and chemical features, and a gaseous state which helps achieve the required mixture with air. It is natural gas which cuts a way towards the top in energy usage; offering less expensive, more secure and more stable alternative of petroleum. Because of this increasing significance, Egypt gave natural gas due interest, and the results were instant and overwhelming. Hence production of the natural gas multiplied 50 times in less than twenty years and the reserve amounted to 22.3 trillion feet cubic in 1996, a number increasing every month and multiplying every several years.

The beginning
The first and biggest natural gas field in Egypt was discovered in 1967 in the Delta; Abu Madi field, and was developed in 1973. At the time commercial utilization of gas had begun in Egypt until production reached 25 billion meters cubic annually in 1976, then multiplied ten times in 1980 to reach 2.5 billion meters cubic per year. In 1986 production reached 6 billion meters cubic then doubled again in 1993 to reach 11 billion meters cubic, and in two years time amounted to 13.8 billion meters cubic.

Parallel to the increase in production, a policy has been designed to expand the use of natural gas to be a basic element of Egyptian energy scale. This was done in answer to the fact that the increase of natural gas contribution in energy sources was the best solution for meeting local demand of energy and at the same time achieving the best utilization of natural resources.

Expansion of natural gas consumption in Egypt through inventing new applications led to the decrease of petroleum consumption to 340,000 barrels daily, the same amount being equivalent to gas generated energy consumption. Thus Egypt was able to respond to local increase of energy demand and maintain Egyptian petroleum good for exportation.

Strategy of energy
As for the second element of the Egyptian strategy of energy, especially in the field of natural gas; it is represented in the support of petroleum and gas reserves in the light of national markets' dynamics and great competition. That is why Egypt decided in 1988 to insert a new item concerning natural gas in agreements with international companies, in addition to amending existing terms to encourage companies working in Egypt to explore for gas, develop and utilize its fields. In 1993, Egypt took yet another step further, as the gas item was amended in petroleum agreements, as well as price - fixed on basis of marketing in equivalence to crude oil.

This contributed to signing more agreements to search for gas, which led to greater discoveries in this field in Egypt, especially in the Delta, Mediterranean & Western Desert. In addition, the Egyptian private sector was encouraged to enter the field of research and exploration, provided with all help and support as it is regarded the basic pillar upon which Egyptian economy would depend in the future.

Agreements signed
Egypt signed about 240 production agreements since 1973 with about 50 local and international companies, which led to spending more than 20 billion dollars on all petroleum activities. It was an expenditure of positive return that was in favour of Egypt, as well as those 50 companies which were together with many more companies, encouraged to compete to sign agreements for petroleum and gas exploration in Egypt. In 1996 alone, thirty two new discoveries were made in the field of petroleum and gas in Egypt, thus having approximately 100 gas fields of which most production is locally consumed through 3000 km. of pipelines, within the frame of the National Gas Net. Egypt was able to rank first among Middle East countries in the best utilization of natural gas, for 80% of electricity generation stations are run through the use of natural gas, as it is considered one of the modern technological applications in generating energy plus preventing pollution and decreasing fuel consumption per generated thermo unit.

Egypt, furthermore, succeeded in conducting leading studies for the utilization of natural gas in central conditioning and started applying this system with electricity, saving about 40% of the total energy used in petroleum with the other usual systems of using electricity.

Gas-using houses
As for using energy inside houses, Egypt was able in a short time to connect gas to more than 150,000 residences in Cairo and Alexandria on the Mediterranean Sea. This number will increase to more than 1.5 million residences according to the new 5-year plan (1997/2002) which includes connecting gas lines to houses in many villages and cities' different districts.

The use of natural gas as fuel in means of transportation is yet another example of the success of gas-production-consumption strategy in Egypt. A lot of companies were established to turn cars from using gasoline to the double use of gas and gasoline, for gas price represents about 50% only of gasoline price. Today thousands of vehicles roam the streets of Egypt running with natural gas, preserving the country's balance of petroleum and protecting environment from pollution.

The choice of natural gas
Natural gas represents the choice of the future concerning development in Egypt which starts from the interest in discovering its infrastructure and importing the latest technology of natural gas products. Therefore, the gas contribution in primal energy resources in Egypt has surpassed 34% while remaining about 23% worldwide.

With the success of the Egyptian petroleum strategy in increasing reserves and producing natural gas, it is now taking the lead in the projects chosen to create more regional cooperation. This is only the beginning of many export projects through pipelines or liquidated gas which Egypt considers as the gas balance grows. Natural gas was neglected for long years until the time came to allow it to strongly pave its way towards the full sway when it comes to primal energy resources and their most practical applications.