A Farm Out Agreement (FOA) is a type of contract that allows investors to acquire a stake from an existing project participant by selling all or percentage stake in the venture
Shell subsidiary BG International Limited has acquired the ExxonMobil-operated North East El-Amriya Offshore Area, Mediterranean Sea – also known as Block 3 through a Farm Out Agreement (FOA). According to a statement, once the transfer is complete, BG will take over as operator of Block 3.
“I am pleased to conclude this agreement, which demonstrates Shell’s deep commitment to Egypt. This agreement strengthens our portfolio in the offshore and supports our strategy to build a solid gas position in the country,” said Khaled Kacem, Shell’s Vice President & Country Chair for Egypt.
A Farm Out Agreement (FOA) is a type of contract that allows investors to acquire a stake from an existing project participant by selling all or percentage stake in the venture.
Completion of the FOA is subject to government and regulatory approvals, BG added.
“This is an important development which demonstrates the vibrancy and competitiveness of Egypt’s oil and gas sector. We are delighted to have the opportunity to work with our partner Shell, which has a long history of working in the oil and gas sector, to further develop Egypt’s offshore hydrocarbon resources,” said Minister of Petroleum and Mineral Resources Tarek El-Molla.
“We have significantly enhanced our presence in the offshore Mediterranean over the last three years and acquiring this new block is an important milestone towards achieving our growth strategy,” Kacem added.
Kacem noted that the agreement will support Shell in accelerating their offshore ambitions, with plans to potentially begin drilling of the first well during the first half of 2023.