British energy giant BP said Friday it would invest $12 billion (11 billion euros) in gas fields in Egypt together with Russian-owned partner DEA, calling it a "vote of confidence" in the country, AFP reported.
"The WND (West Nile Delta) project investment is the largest foreign direct investment in Egypt," BP's chief executive Bob Dudley said in a statement after final agreements were signed.
"WND production is key to Egypt's energy security," he said, with BP announcing that all the gas would be fed into the national grid and would eventually double BP's supply to the domestic market. Hesham Mekawi, BP North Africa's regional president, said the agreements marked "a critical milestone in the Egyptian oil and gas history". BP said that during the construction phase the project would employ thousands of people.
The aim is to develop five trillion cubic feet of gas resources and 55 million barrels of condensates, with production expected to begin in 2017. "The project underlines BP's commitment to the Egyptian market and is a vote of confidence in Egypt's investment climate and economic potential," the statement said.
Gas will be produced by two BP-operated offshore blocks -- North Alexandria and West Mediterranean Deepwater -- with a potential for future exploration. BP holds a 65-percent stake in the project, while DEA owns the remaining 35 percent.
DEA was the oil and gas unit of German power giant RWE, which was sold to a Russian-controlled investment fund, LetterOne, earlier this week. LetterOne is based in Luxembourg, but controlled by Russia's Alfa Group which belongs to billionaire entrepreneur Mikhail Fridman. BP is already one of the largest foreign investors in Egypt, with investments totalling more than $25 billion over the past five decades. It has existing operations in the Gulf of Suez and the East Nile Delta.
