RWE, El Paso Swap Stakes in Adjoining Onshore Egyptian Acreage
RWE Dea AG, Hamburg, and El Paso Exploration and Production Company, Houston (USA), have entered into an agreement to exchange interests in adjoining exploration acreage holdings in Egypt.
Each company has assigned a 40% equity interest to the other in an arrangement involving RWE Dea's Tanta Concessions in the Nile Delta transition area and El Paso's South Mariut Concession in the Western Desert. Prior to the execution of these agreements, RWE Dea held a 100% interest in the Tanta Block and El Paso held a 100% interest in the South Mariut Block. After the assignment of the respective interests, RWE Dea will have a 60% operated interest in the Tanta Block and a 40% interest in the El Paso-operated South Mariut Block. These assignments have been approved by the Egyptian authorities.
"These agreements allow us to join forces with a highly experienced partner to further explore the Tanta and South Mariut Concessions -- two of the most prospective onshore blocks offered in Egypt in recent bid rounds," said Hans-Hermann Andreae, General Manager of RWE Dea in Egypt.
"El Paso now has a larger footprint in a highly prospective onshore exploration area," added Brent Smolik, president of El Paso Exploration & Production Company. "We look forward to working with RWE Dea, which brings significant experience and talent to our joint exploration effort."
The Tanta Concession Agreement was signed by RWE Dea with the Egyptian Government in 2007. The Tanta initial 3-year exploration program has a two well commitment, the first of which is expected to be drilled in 2010. As a result of the 2005 Egyptian General Petroleum Company open bid round, El Paso was the successful bidder for the South Mariut Block. The South Mariut Concession Agreement was signed on 5 April 2007 and since that time, El Paso has actively engaged in exploration prospecting activities, including over 800 square kilometers of 3D seismic acquired in 2008. The initial exploration period is 3 years and drilling of five wells, the spud date of the first well was January 31, 2009.
El Paso now holds an acreage position totaling 2.04 million gross acres, or 1.05 million net acres, of strategic exploration properties in Egypt, focused in the Western Desert and Nile Delta provinces.
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