By: Oil & gas Middle east

Egypt has launched a new global tender for oil and gas exploration in four blocks in the Red Sea, marking the first time the country is offering a production-sharing contract based on the profitability factor, or R-Factor, to foreign companies.

The move is part of Egypt’s broader strategy to maximise its hydrocarbon resources, news agency Zawya has reported.

The state-owned South Valley Egyptian Petroleum Holding is overseeing the tender, which features Egypt’s longest oil bidding deadline of six months. The petroleum and mineral resources ministry said the deadline of 3 May is intended to give international companies sufficient time to study the areas and prepare technically precise investment proposals.

“This tender applies modern mechanisms to encourage global companies to invest in virgin and deepwater areas,” the ministry said. “The production-sharing system based on R-Factor aligns rewards with the size of risks and investments.”

The initiative comes as Egypt accelerates its oil and gas exploration programme with international partners to expand production and boost reserves. Last month, oil and mineral resources minister Karim Badawi unveiled a five-year plan to invest $5.7 billion in oil operations, including drilling 480 wells.