Dana Gas, one of the largest private natural gas companies in the Middle East, has received $20 million from the Egyptian government to settle outstanding payments.
The move reflects the “constructive engagement with the Egyptian government”, which has proactively sought to clear the arrears in the sector, Dana Gas said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.
“We are very encouraged by our progress in Egypt, both operationally and in collections,” Dana Gas chief executive Richard Hall said.
“Importantly, this payment completes the settlement of Dana Gas Egypt’s overdue receivables and brings our receivables position fully up to date.”
The move highlights the Egyptian government’s efforts to boost foreign investment in the country’s energy sector, Mr Hall added.
Constrained by economic and financial pressures, Egypt had for years struggled to clear the dues owed to oil and gas companies operating in the country. However, it has managed catch up over the past couple of years.
Dana Gas, whose headquarters are in Sharjah, received a $50 million payment from Egypt in January, which “significantly” reduced its receivables.
Continued payments support the company’s drilling programme under a $100 million consolidation agreement, Dana Gas said at the time in a bourse filing.
The multiyear deal, signed with Cairo in late 2024, integrated Dana Gas’s concessions in Egypt and aims to support new upstream investment and expand Dana Gas’s scope for exploration drilling.
During the first quarter of this year, average production increased four per cent year-on-year to 13,060 barrels-of-oil-equivalent per day, Dana Gas said.
“This marks the first period of production growth in Egypt following a period of natural decline, demonstrating the impact of the company’s continuing investment programme,” the company said.
Dana Gas has successfully drilled four wells. It also carried out workovers across three additional wells last year, adding approximately 30 million standard cubic feet per day of production and 36 billion cubic feet of reserves.
Egypt has increasingly relied on gas imports to meet its energy demand due to declining production from its maturing gasfields. Once a regional gas exporter, Egypt has turned to costly liquefied natural gas imports as output declines and power demand rises.
Established in 2005, Dana Gas has exploration and production assets in Egypt, as well as in Iraq’s Kurdistan region and its home base in the UAE.
