Texas-based Energy firm Apache has signed deals with Egypt’s Ministry of Petroleum to search for oil and gas in Ras Knaess and Siwa in the Western Sahara.
According to a Wednesday announcement from the Ministry, the agreements are worth at least US$44 million in investments, and include signing bonuses of $25 million.
The first agreement, in Ras Knaess, includes investments of $28 million to dig seven wells, while the second agreement, in Siwa, includes investments of $16 million to dig four wells.
Petroleum Minister Sherif Ismail noted that the new agreements bring the total of new deals since October 2013 up to 35, with an estimated investment value exceeding $2 billion and signing bonuses of $242 million to drill 149 wells.
Apache, which in 2011 depended on Egypt for 22 percent of production, has been hit hard by its exposure to Egypt. As post-revolution turmoil roiled Egypt, Apache stock prices fell, a trend that contributed to the company’s 2013 decision to sell a third of its Egypt operations to Chinese state-owned Sinopec for $3.1 billion.
In the meantime, falling oil and gas production has hit Egypt hard, leading to an energy shortage that has caused nationwide blackouts. A recent spate of investments suggests that Egypt’s petroleum sector is starting to pick up again, although activists have expressed concern that Egypt’s energy crisis may be allowing multinational companies leverage to push for more favorable terms.