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Italian oil company Eni (E 0.92%) announced on Aug. 30 that it may have discovered one of the world's largest natural gas fields off the coast of Egypt.
The company said that the discovery may hold 30 trillion cubic feet of natural gas in place (5.5 billion barrels of oil equivalent) over an area of 100 square kilometers. Not only is that enough to rank it as the largest find ever made in the Mediterranean Sea, but that ranks as one of the top in the world. Eni says that, when fully developed, the Zohr field could provide enough gas to satisfy Egypt's natural gas demand for decades.
The Eastern Mediterranean has emerged as one of the most important gas regions across the globe in recent years. Egypt's neighbor Israel has ambitious plans to develop its huge gas fields. In 2009, Noble Energy discovered the Tamar field in Israeli waters, a major discovery that may hold 10 trillion cubic feet of natural gas. They topped that find with an even larger discovery in 2010 -- the Leviathan.
Although Noble Energy and its partners have run into some trouble with Israeli regulators, which has slowed development, the Israeli government has recently cleared up their regulatory policy, hopefully easing the way for the large gas fields to move toward production. Eni's discovery further proves the potential for the Eastern Mediterranean.
For Egypt, Eni's huge discovery could be a godsend. The country has suffered from energy shortages and blackouts, and has resorted to importing LNG to meet the shortfall.
"This historic discovery will be able to transform the energy scenario of Egypt in which we have been welcomed for over 60 years," said Eni's CEO Claudio Descalzi, referring to his company's long-standing presence in Egypt. "I think we can discover more," Descalzi told the Financial Times. Drilling could begin next year with first production beginning shortly afterward.
The success follows a $2 billion agreement with the Egyptian oil ministry in June 2015, which allowed the Italian company to explore in the Sinai, the Gulf of Suez, offshore in the Mediterranean, and in the Nile Delta.
