Dana Gas receives $50 million Egypt payment to fund drilling and cut fuel imports

Dubai: Dana Gas has received a $50 million (Dh184 million) payment from the Egyptian government, a move that trims overdue receivables and supports an accelerated drilling push aimed at boosting domestic gas supply and cutting costly imports. The payment is tied to the company’s multi-year investment programme under a consolidation deal that brings its Egyptian concessions under one framework with improved fiscal terms and added exploration acreage.

Payment eases receivables, backs new deal

The company said the latest transfer from Cairo materially reduces outstanding receivables that had built up over previous years. The funds will support drilling and workover activity agreed under the Consolidation Agreement signed with the Egyptian government in December 2024, which consolidated Dana Gas’s Egyptian concessions, upgraded fiscal terms and allocated additional exploration blocks to unlock new gas resources.

“We are grateful to the Ministry of Petroleum and Mineral Resources, the Egyptian General Petroleum Corporation and the Egyptian Natural Gas Holding Company for their continued support" saidd Richard Hall, CEO, Dana Gas. "This latest payment, which will help fund our investment programme in Egypt, acknowledges the importance of timely payments to ensuring the successful delivery of our drilling programme.”

New wells add production and reserves

Since the programme started, Dana Gas has drilled four wells in Egypt, including the recent North El-Basant 1 discovery, which is estimated to hold 15 bcf of recoverable gas. These wells have added about 18 mmscfd of new production and delivered a material uplift in reserves, strengthening the company’s upstream position in one of its core markets.

The company plans seven more wells in 2026 as part of an 11-well campaign, with the Daffodil exploration well scheduled to spud in January. Management sees this next phase as key to sustaining and growing production volumes, while also testing new acreage brought in under the consolidation framework.

Workovers boost output, more candidates lined up

In parallel with the new drilling, Dana Gas has completed a workover programme across three existing wells. That activity has delivered an additional 9 mmscfd of production, providing a low-cost uplift that complements the contribution from new wells. Further technical reviews are underway to identify more workover candidates for 2026, allowing the company to squeeze more output from its current asset base while exploration and development wells are brought online.

Egypt set to save over $1 billion on imports

Dana Gas expects its 11-well investment programme, once fully delivered in 2026, to save Egypt more than $1 billion by displacing imported LNG and mazut with locally produced gas. By channelling new volumes into the domestic market, the company’s projects are intended to reduce foreign currency outflows tied to fuel purchases and support the government’s strategy to reinforce Egypt’s position as a regional gas hub.