Chevron and several international energy companies have withdrawn from Egypt’s Red Sea oil and gas concessions after failing to make commercial discoveries, the petroleum ministry confirmed Thursday.
The exits mark a shift in strategy from a 2019 initiative that aimed to position Egypt as a regional energy hub through first-time Red Sea tenders. The awarded concessions had attracted Chevron, Shell, and the Abu Dhabi-based Mubadala Investment Company.
“Companies have spent millions on exploration without results,” ministry spokesperson Moataz Atef told reporters. He cited one unnamed firm that spent $34 million on a $10 million contract without success.
Chevron officially relinquished its 45% stake in Red Sea Block 1, confirming its departure from the northern Red Sea project. Despite this, the company emphasized ongoing collaboration with the Egyptian government.
“Chevron remains committed to Egypt’s energy sector through our Mediterranean exploration programs,” said spokesperson Sally Jones.
Chevron had operated Red Sea Block 1 alongside Australia’s Woodside Energy. Shell, in partnership with QatarEnergy and Woodside, held Red Sea Block 3 but declined to comment on its status.
Mubadala, Woodside, and QatarEnergy were unavailable for immediate comment. The ministry declined to specify which firms besides Chevron had relinquished blocks.
Despite the setback, Atef said both Shell and Chevron have applied for new Mediterranean concessions, signaling sustained investor interest.
Egypt’s natural gas production dropped from 4.6 to 3.6 billion cubic meters year-on-year in January, underscoring the sector’s mounting challenges.
To combat potential summer shortages, Egypt has secured LNG shipments and plans to deploy three to four floating regasification units.
“We’re prepared for peak demand,” Atef said, referencing last summer’s blackouts and costly energy imports totaling $1.18 billion.