Egypt Launches 42 New Oil and Gas Exploration Blocks Under Expanded Investment Program

Cairo | EcoPulse24

Egypt’s Ministry of Petroleum and Mineral Resources has unveiled a major offering of 42 oil and gas exploration and production areas to international energy firms, as part of a new program aimed at enhancing foreign investment and increasing domestic output. The areas are accessible via the Egypt Digital Exploration and Production Gateway.

The offered blocks include 26 new exploration areas, 10 abandoned sites, and 6 undeveloped discoveries. Geographically, these are distributed across the Mediterranean Sea, Nile Delta, Gulf of Suez, Western Desert, and Eastern Desert - reflecting Egypt’s strategy to maximize hydrocarbon resource utilization in diverse geological basins.

The ministry stated that participating companies can access technical data through physical or virtual data rooms, assess the blocks, and express formal interest ahead of a defined bidding period. Bidding rounds will be held regularly, fostering competitive offers and new market entrants.

Additionally, Egypt is launching a global bid for four blocks in the Red Sea, applying for the first time a risk-based production sharing model (R-Factor), which links investor returns to risk level and capital expenditure. This model is considered more attractive for frontier and deepwater areas. During the ADIPEC 2025 conference, Petroleum Minister Karim Badawi highlighted this as a shift in contract philosophy to encourage long-term investment.

The government has introduced a set of financial and operational incentives, including a clear schedule for settling dues, allowing partners to export part of their production via Egyptian LNG terminals, selling oil and gas to the government at higher prices than previous contracts (matching export revenues), and raising the foreign partner’s share of new production under a flexible economic model. These steps aim to revive exploration and production momentum after a period of decline.

The moves come as Egypt’s gas sector has faced challenges over the past two years due to declining local output. Since April 2024, Egypt has been importing LNG to meet rising demand, especially from the power sector. The ministry has expanded imports by contracting five gas regasification units and boosting supply flexibility to avoid power outages.

Economically, this new round underlines Egypt’s bid to regain its status as a regional energy hub in the Eastern Mediterranean by attracting high-risk exploration investment, increasing domestic production, and reducing medium-term reliance on LNG imports.