Claudio Descalzi
Claudio Descalzi, CEO of Eni, speaks during the IHS CERAWeek 2015 energy conference in Houston, Texas April 22, 2015. Reuters

The energy sector is abuzz with excitement over the announcement on Sunday by Italian energy giant Eni that it has discovered a "supergiant" gasfield off Egypt’s coast. It is the largest gas find in the Mediterranean Sea and is estimated to hold 30 trillion cubic feet of gas or 5.5 billion barrels of oil.

It is located in the Zohr Prospect in the Shorouk block which Eni wholly owns the licence. The field was found in 1,450 metres of water in the exploration block and covers an area of 100 square kilometres, approximately 200 kilometres off the coast of Egypt, reports Financial Times.

The discovery is a validation of the energy firm’s strategy of exploring mature areas. Eni CEO Claudio Descalzi said in a statement, “Egypt has still great potential,” reports Bloomberg. He adds that the discovery would contribute to Egyptian oil supply for decades. The discovery comes at a time that there is a search for new deposits by international oil and gas companies as existing fields are depleted.

Manaar Energy Consulting analyst Robin Mills says that while a field that size would be sufficient to cover a lot of Egypt’s energy gap, Cairo would likely meet domestic demand first before it goes into export plans. It would take a minimum of four years to develop the field which means the earliest time that any production in the Shorouk block would start is about 2020, Mills estimates.

EFG Hermes Egypt economist Mohamed Abu Basha said the discovery would provide potential relief to Egypt’s energy situation both in terms of availability and price. He estimates the find’s size to 45 percent of Egypt’s reserves.

Basha said that for at least 10 years, Egypt could rely on the gas find for its domestic supply, while he field provides Europe a new supply alternative other than importing gas from Russia. He says further exploration could possibly yield as much as 40 trillion cubic feet of gas and oil.

The Egyptian Petroleum Ministry said that Descalzi met on Saturday in Cairo with Egyptian President Abdel-Fattah El-Sisi and the country’s prime minister to discuss the discovery. It was Descalzi, who became CEO in 2014, who led Eni in its largest natural gas discovery at Mozambique’s Mamba field. The field has 75 trillion cubic feet of gas.

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