Egypt Launches New Licensing Round to Boost Oil and Gas Production

Egypt is taking significant steps to enhance its domestic oil and gas production by inviting international companies to bid on 13 offshore and onshore blocks in a new licensing round. This move is part of the country’s strategy to attract more foreign investments into its upstream oil and gas industry, while further increasing its production capabilities.

The Open Blocks Licensing Program (OBLP), which will close on May 4, 2025, includes six new exploration areas and seven undeveloped discoveries. The undeveloped discoveries are situated in the Mediterranean, while the exploration blocks include three offshore blocks in the Gulf of Suez and three onshore areas in Egypt’s Western Desert.

This licensing round comes at a time when Egypt’s Mediterranean waters are becoming a central focus of exploration and development. In particular, the Zohr gas field, discovered by Italy’s Eni in 2015, has already become the largest natural gas discovery in the Mediterranean to date, boosting Egypt’s position as a key player in the region's energy sector.

Foreign firms have shown interest in Egypt's vast potential. For instance, BP recently launched the second phase of its Raven gas field development offshore Egypt as part of the West Nile Delta project. The new phase is expected to add approximately 220 billion cubic feet of gas and 7 million barrels of condensate to production.

Investment firms, such as Carlyle Group, are also entering the Egyptian market, aiming to bolster domestic production and transform the country into a Mediterranean energy hub. Carlyle’s recent acquisition of a portfolio of gas-weighted exploration and production assets in Italy, Egypt, and Croatia marks a strong commitment to the region.

Russia’s Declining Oil and Gas Revenues Amid Global Uncertainty

Meanwhile, Russia is facing challenges in its oil and gas revenue streams. According to the Russian Finance Ministry, February 2025 saw an 18.4% decline in oil and gas revenues, with $8.6 billion (771.3 billion rubles) generated from these sectors, down from $10.6 billion in February 2024. This drop is attributed to lower oil prices, which have impacted Russia’s federal budget, as oil and gas sales make up a significant portion of its income.

Further complicating matters for Russia are the sanctions imposed in January 2025, which have affected the trade of Russian oil. The sanctions have delayed some shipments and caused issues with the supply chain. Tankers carrying Russian crude continue to struggle with delivering oil, as buyers and vessels avoid the supply chain sanctioned by the U.S., further straining Russia's ability to sell its crude.

The sanctions specifically target Russian vessels used to transport crude from the Far East and Arctic oil fields to Asia. Of the 19 vessels loaded from Sakhalin Island since the sanctions took effect, only five have successfully delivered their cargo. This ongoing issue has put further pressure on Russia's oil industry, highlighting the volatility of the country’s oil revenues.

As a result, Russia has indicated its intention to reduce its dependence on oil in order to stabilize its federal budget and minimize the impact of fluctuating oil and gas prices. However, this strategy could take time, as the country continues to grapple with the effects of international sanctions and a volatile global market.