State-run QatarEnergy, formerly known as Qatar Petroleum, has entered into agreements with Shell to acquire a 17 percent stake in two Shell-operated concessions in Egypt's Red Sea region, the two companies said in statements on Monday. Shell will remain the main operator of the concessions, Shell Egypt's statement read. Under the terms of the agreements, QatarEnergy said in a statement that it would hold a 17 percent working interest in Red Sea Blocks 3 and 4. Shell won Blocks 3 and 4 in late 2019. Block 3 covers 3,097 square kilometres, with water depths from 100 to 1,000 metres. Block 4 covers 3,084 square kilometres, with water depths of 150 to 500 metres. The agreements are subject to customary approvals by the Egyptian government. QatarEnergy president and chief executive Saad Sherida Al-Kaabi said the agreements see the company enter "Egypt's well-established upstream oil and gas sector and offers an opportunity for the consortium partners to explore this frontier acreage," "We are also delighted to have the opportunity to work with our strategic partner Shell, and to further develop our relationship with the Egyptian Ministry of Petroleum and Mineral Resources, Egypt's Tharwa Petroleum and the other partners, whilst also pushing forward with QatarEnergy's upstream growth strategy," Al-Kaabi added. Khaled Kacem, Shell's country head of Egypt, said: "we were able to attract new market entrants thanks to the favourable investment climate in Egypt." Shell said QatarEnergy's entry followed BHP Petroleum's, which is still subject to customary approvals by the Egyptian government. Upon closing of the relevant agreements, the working interests in the two blocks will be as follows: Shell will have 43 percent in Block 3 and 21 percent in Block 4. BHP has a 30 percent stake in Block 3, while Tharwa Petroleum has 10 percent. For Block 4, Mubadala Petroleum has 27 percent, BHP 25 percent and Tharwa Petroleum 10 percent. Mubadala entered Block 4 earlier this year. Shell committed to acquiring seismic and carry out subsurface studies on the blocks, under the 2019 round.
