Arab Finance: Minister of Petroleum and Mineral Resources Karim Badawi has introduced incentives to expand horizontal drilling and hydraulic fracturing to boost local production, according to a statement.

During an extensive meeting with representatives of investment partners and petroleum sector leaders, Badawi called on officials to move forward with the five-year plan to maximize domestic production and reduce reliance on imports.

He affirmed that the ministry is working on providing investment incentives and deploying advanced business models in collaboration with tech firms to support horizontal drilling and hydraulic fracturing.

These models include integrated project management (IPM) and lump sum turnkey (LSTK) contracts, with a focus on enhancing data quality and seismic surveys to support investment decisions and de-risk operations.

He also addressed the implementation of investment-incentivizing models to accelerate oil and gas exploration in untapped areas far from existing infrastructure, such as the Western Mediterranean, the Red Sea, and the southwestern Western Desert.

In the same vein, the minister highlighted that Egypt reduced dues to international oil companies (IOCs) from $6.1 billion in June 2024 to $714 million last April. The country targets full settlement of its arrears to IOCs by the end of June 2026.

For their part, representatives of international companies praised Egypt’s shift in management approach, which has been reflected in accelerated decision-making and overcoming challenges.

They also emphasized that flexible contractual models, along with incentives for horizontal drilling and fracking, enhanced the attractiveness and global competitiveness of Egypt’s concession areas.

Moreover, the partners voiced their interest in contributing to the energy transition, particularly the integration of natural gas security with the expansion of renewable energy, supporting Egypt’s goal to increase the share of renewables in the energy mix by 2028.