L. Fituni, I. Abramova Resource Potential of Africa and Russia's ...

L. Fituni, I. Abramova Resource Potential of Africa and Russia's ... L. Fituni, I. Abramova Resource Potential of Africa and Russia's ...

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that the gas crisis between Russia and Ukraine was "commercial and not political." 43 If they have the will, Russian oil and gas companies can look forward to significantly expanding their presence in the Algerian hydrocarbon production market as part of the plans of the Algerian state company SONATRACH to invest up to $63 billion in developing the industry during the period up to and including 2012 using both Algerian funds and funds of foreign partners. Soviet assistance to Egypt in exploring its mineral resources began soon after the signing in 1958 of a general agreement on economic and technical cooperation as a part of measures to develop heavy industry in the country whose mineral raw-material base had been investigated rather inadequately. The country mined small quantities of oil, phosphorites, manganese, polymetallic ores, soda, rock, salt and some other minerals. Soviet oil experts provided assistance to the Egyptian General Petroleum Authority in geophysical and prospecting work for oil in the Suez Gulf area. In 1958, two new oil deposits were discovered with their help in the region of Bakra and Karim on the western coast of the Suez Gulf. Soviet experts have reviewed the available geophysical materials on the northern part of the Western Desert with an area of about 200,000 square kilometers. On the basis of that work aeromagnetic surveys over an area of 184,000 square kilometers were carried out in western sectors of the desert in 1966–1968, and seismic and drilling work was conducted in accordance with the methods used in the USSR. Egyptian state agencies have been provided with elaborate materials about the geological structure of the territories surveyed, with evaluations of their oil reserves. Soviet equipment has also been supplied to the Central Laboratory of Mineral Raw Materials in Egypt. Besides, Soviet organizations have supplied Egypt with 20 mobile laboratories for analyzing raw materials in field conditions. An important aspect of Soviet experts' work in Egypt was prospecting for iron ore, the demand for which had considerably grown with the enlargement of the Helwan Iron and Steel Works up to 1.5 103

million tons. In the early 1960s, Soviet specialists helped to thoroughly charter an iron ore deposit in the Baharia Oasis in the Western Desert. Soviet geologists took part in prospecting for poly-metallic ores and alumina in the Eastern Desert along the Red Sea coast. They also participated in prospecting work for rare metals deposits at Abu Dabbab and Nuwaiba, with the estimated amounts of ore reaching 40 million and 60 million tons, respectively, as well as comprehensive geological prospecting in the central part of the Eastern Desert, where the presence of more than 40 types of minerals was established: tin, tantalum, niobium, gold, etc. Mercury has been discovered in Egypt for the first time. In the Western Desert, Soviet geologists did preliminary prospecting for a big deposit of phosphorites at Abu Tartur. The post-Soviet cooperation in the mineral resource sphere is concentrated around participation in infrastructural (transportation by pipelines of Egyptian natural gas to Syria and Lebanon) and energy projects. Russian private companies may also take part in prospecting for oil, gas and various minerals, applying modern Russian technologies, which have no analogues in the world. They may create joint ventures in oil and gas production and processing of byproduct gas. However, in this sphere they have such strong competitors as the Amoco of the USA and Agip of Italy, which dominate the Egyptian oil and gas market. Among Russian energy companies LUKOIL and Novatek are the leaders in exploring Egypt’s potential. The main LUKOIL project in Egypt is West Esch El Mallaha (WEEM, Red Sea coast). A concession agreement on the WEEM block was reached in 1993 and commercial launch was announced in January 1998. LUKOIL currently holds a 50 percent stake in the concession. Other parties to the concession agreement are the Egyptian state petroleum company EGPC and the Government of Egypt. Total WEEM oil production increased by 404% in 2002 to 363.8 thousand tons (compared with 72.1 thousand tons in 2001). Oil production forecast for 2003 is 535.3 thousand tons. The project has generated positive cash flow since May 2002, and income last year totaled $14 mln. Proved reserves at WEEM are 4.4 mln tons. 44 104

that the gas crisis between Russia <strong>and</strong> Ukraine was "commercial <strong>and</strong><br />

not political." 43<br />

If they have the will, Russian oil <strong>and</strong> gas companies can look<br />

forward to significantly exp<strong>and</strong>ing their presence in the Algerian<br />

hydrocarbon production market as part <strong>of</strong> the plans <strong>of</strong> the Algerian<br />

state company SONATRACH to invest up to $63 billion in developing<br />

the industry during the period up to <strong>and</strong> including 2012 using<br />

both Algerian funds <strong>and</strong> funds <strong>of</strong> foreign partners.<br />

Soviet assistance to Egypt in exploring its mineral resources began<br />

soon after the signing in 1958 <strong>of</strong> a general agreement on economic<br />

<strong>and</strong> technical cooperation as a part <strong>of</strong> measures to develop<br />

heavy industry in the country whose mineral raw-material base had<br />

been investigated rather inadequately. The country mined small<br />

quantities <strong>of</strong> oil, phosphorites, manganese, polymetallic ores, soda,<br />

rock, salt <strong>and</strong> some other minerals.<br />

Soviet oil experts provided assistance to the Egyptian General<br />

Petroleum Authority in geophysical <strong>and</strong> prospecting work for oil in<br />

the Suez Gulf area. In 1958, two new oil deposits were discovered<br />

with their help in the region <strong>of</strong> Bakra <strong>and</strong> Karim on the western<br />

coast <strong>of</strong> the Suez Gulf.<br />

Soviet experts have reviewed the available geophysical materials<br />

on the northern part <strong>of</strong> the Western Desert with an area <strong>of</strong> about<br />

200,000 square kilometers. On the basis <strong>of</strong> that work aeromagnetic<br />

surveys over an area <strong>of</strong> 184,000 square kilometers were carried out<br />

in western sectors <strong>of</strong> the desert in 1966–1968, <strong>and</strong> seismic <strong>and</strong> drilling<br />

work was conducted in accordance with the methods used in the<br />

USSR. Egyptian state agencies have been provided with elaborate<br />

materials about the geological structure <strong>of</strong> the territories surveyed,<br />

with evaluations <strong>of</strong> their oil reserves.<br />

Soviet equipment has also been supplied to the Central Laboratory<br />

<strong>of</strong> Mineral Raw Materials in Egypt. Besides, Soviet organizations<br />

have supplied Egypt with 20 mobile laboratories for analyzing<br />

raw materials in field conditions.<br />

An important aspect <strong>of</strong> Soviet experts' work in Egypt was prospecting<br />

for iron ore, the dem<strong>and</strong> for which had considerably grown<br />

with the enlargement <strong>of</strong> the Helwan Iron <strong>and</strong> Steel Works up to 1.5<br />

103

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