The Security Service of Ukraine (SBU) says the sale of NJSC Naftogaz Ukrainy’s assets in Egypt is inexpedient, Naftogaz CEO Andriy Kobolev has said.
“Such recommendations of the SBU threaten the receipt by Naftogaz of about $100 million in revenue, and also do not allow the company to fulfill the task set by the government to achieve KPI (key performance indicator) in terms of return on assets,” Kobolev said at a Novoye Vremya event on Dec. 17.
As reported, Kobolev late in 2016 announced that the group was considering the possibility of selling the company’s assets in Egypt, since this business does not bring much profit in connection with a decline in crude oil prices.
Naftogaz, through its subsidiary Zakordonnaftogaz, is exploring and operating two oil and gas blocks in the eastern desert of Egypt – South Wadi El Mahareeth and Wadi El Mahareeth. Work on these blocks, with an estimated resource of more than 360 million tonnes of crude oil, is carried out on the basis of concession agreements signed on Feb. 7, 2012 between Zakordonnaftogaz on behalf of Naftogaz, on the one hand, and the Government of the Arab Republic of Egypt and the State Oil Company GANOPE (Ganoub El – Wadi Holding Petroleum Company), on the other. The concession agreements are valid for 28 years.
In terms of the geography of Naftogaz’s revenue, Egypt brought Hr 0.505 billion in 2018, and Hr 0.457 billion in 2017.
