Egypt, Cheiron Sign $42mln East Alexandria Gas Exploration Deal

By Al Mayadeen English

10 Nov 2026 09:22

Egypt's EGAS and Cheiron sign a $42.2 million East Alexandria offshore exploration agreement, committing to three exploratory wells in the Mediterranean.

Egypt's state-owned Egyptian Natural Gas Holding Company (EGAS) has signed a $42.2 million offshore gas exploration agreement with Cheiron for the East Alexandria concession in the Mediterranean, committing the company to drilling three exploratory wells.

The Ministry of Petroleum and Mineral Resources announced the agreement on November 9, following a signing ceremony overseen by Petroleum Minister Karim Badawi.

The exploration program includes three wells and the reprocessing of seismic data to assess the area's natural gas potential. The minimum investment exceeds $42 million, while the agreement follows an international bidding round launched by EGAS, which awarded the concession to Cheiron in June 2025.

Badawi said the agreement would accelerate exploration activities and enable international partners to begin work programs in newly awarded areas.

EGAS Managing Director Sayed Selim signed on behalf of the state company, while Cheiron Chief Commercial Officer Amina Taha represented the Egyptian energy producer.

Egypt announces discovery of gas in the Mediterranean

Egypt announced a new natural gas discovery in the Mediterranean Sea, with preliminary estimates of around 200 billion cubic feet in the exploratory well "Nasim-1X".

Cairo aspires to help support domestic gas production and reduce reliance on imports through this new discovery.

The Egyptian Ministry of Petroleum and Mineral Resources stated on Friday that drilling and appraisal work at the well, located in the Taiba concession area, revealed a gas-bearing layer with a net thickness of around 15 metres that also features distinct geological and petrophysical characteristics.

Cheiron expands exploration activity in Egypt

Cheiron already operates across several Egyptian energy-producing regions, including the Western Desert, the Mediterranean, and the Gulf of Suez.

Badawi highlighted the company's use of horizontal drilling and hydraulic fracturing in the Western Desert, as well as its natural gas operations at the West Burullus field.

The East Alexandria agreement adds to Egypt's efforts to attract investment into offshore exploration and expand domestic gas resources.

Cheiron should not be confused with Chevron, which signed a separate $88 million exploration agreement with EGAS for the Lotus block in October.

Draft agreement outlines production-sharing terms

Financial provisions previously reported by Arab Finance, citing Almal News, included a $1 million non-refundable signing bonus payable to EGAS and a cost-recovery ceiling of 40%.

Under the draft legislation approved by parliament's Energy and Environment Committee in July, EGAS would receive between 64% and 70% of profit oil and gas, depending on production volumes and Brent crude prices.

The draft law authorized the petroleum minister to sign the production-sharing agreement with Cheiron Egypt Delta Limited. The ministry's announcement of the signed agreement did not disclose whether these previously reported fiscal provisions remained unchanged.