BP has agreed to acquire a 10% stake in Shorouk concession offshore Egypt from Eni, an Italian oil and gas company. In an announcement made on Friday (25 November), the British firm said it would pay $375m (£300m) for the deal.
Super-giant Zohr gas field, discovered by Eni in 2015, is in the Shorouk concession. Located in Mediterranean Sea, the field is estimated to hold 30 trillion cubic feet (850 billion cubic metres) of gas.
As part of the agreement, the British oil giant said it also holds an option to buy an additional 5% interest in the concession before the end of 2017. BP added that it would also reimburse Eni for its share of past expenditure once the deal closes.
BP, which has been doing business in Egypt for over 50 years, said that the deal was expected to be completed in second quarter of 2017. The company, however, added that the acquisition was subject to regulatory approvals from the Egyptian Government.
Back in October this year, BP announced that it would ditch its exploration drilling programme in the Great Australian Bight (GAB). The company had said that it would focus only on projects that are likely to create value in near to medium term.
Commenting on the current deal, Bob Dudley, BP group CEO said in a statement, "This interest in a truly world-scale asset will complement our existing Egyptian business. We already have a strong partnership with Eni in Egypt and look forward to working closely with them to efficiently bring these important resources to the Egyptian market.
"BP has now been in Egypt for over 50 years and we continue to see opportunities to further develop our extensive activities here. Beyond Zohr, the first phase of our major West Nile Delta project is on schedule to begin production next year and the fast-tracked development of the Atoll gas field is expected to come on stream in 2018," he added.