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

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million tons. In the early 1960s, Soviet specialists helped to thoroughly<br />

charter an iron ore deposit in the Baharia Oasis in the Western<br />

Desert. Soviet geologists took part in prospecting for poly-metallic<br />

ores <strong>and</strong> alumina in the Eastern Desert along the Red Sea coast.<br />

They also participated in prospecting work for rare metals deposits<br />

at Abu Dabbab <strong>and</strong> Nuwaiba, with the estimated amounts <strong>of</strong><br />

ore reaching 40 million <strong>and</strong> 60 million tons, respectively, as well as<br />

comprehensive geological prospecting in the central part <strong>of</strong> the<br />

Eastern Desert, where the presence <strong>of</strong> more than 40 types <strong>of</strong> minerals<br />

was established: tin, tantalum, niobium, gold, etc. Mercury has<br />

been discovered in Egypt for the first time. In the Western Desert,<br />

Soviet geologists did preliminary prospecting for a big deposit <strong>of</strong><br />

phosphorites at Abu Tartur.<br />

The post-Soviet cooperation in the mineral resource sphere is<br />

concentrated around participation in infrastructural (transportation<br />

by pipelines <strong>of</strong> Egyptian natural gas to Syria <strong>and</strong> Lebanon) <strong>and</strong> energy<br />

projects. Russian private companies may also take part in prospecting<br />

for oil, gas <strong>and</strong> various minerals, applying modern Russian<br />

technologies, which have no analogues in the world. They may create<br />

joint ventures in oil <strong>and</strong> gas production <strong>and</strong> processing <strong>of</strong> byproduct<br />

gas. However, in this sphere they have such strong competitors<br />

as the Amoco <strong>of</strong> the USA <strong>and</strong> Agip <strong>of</strong> Italy, which dominate the<br />

Egyptian oil <strong>and</strong> gas market.<br />

Among Russian energy companies LUKOIL <strong>and</strong> Novatek are<br />

the leaders in exploring Egypt’s potential. The main LUKOIL project<br />

in Egypt is West Esch El Mallaha (WEEM, Red Sea coast). A<br />

concession agreement on the WEEM block was reached in 1993 <strong>and</strong><br />

commercial launch was announced in January 1998. LUKOIL currently<br />

holds a 50 percent stake in the concession. Other parties to the<br />

concession agreement are the Egyptian state petroleum company<br />

EGPC <strong>and</strong> the Government <strong>of</strong> Egypt. Total WEEM oil production<br />

increased by 404% in 2002 to 363.8 thous<strong>and</strong> tons (compared with<br />

72.1 thous<strong>and</strong> tons in 2001). Oil production forecast for 2003 is<br />

535.3 thous<strong>and</strong> tons. The project has generated positive cash flow<br />

since May 2002, <strong>and</strong> income last year totaled $14 mln. Proved reserves<br />

at WEEM are 4.4 mln tons. 44<br />

104

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