Lukoil will develop the South Wadi Al-Sahel concession in Egypt, the newspaper Al Mal has reported

Egypt has granted Russian oil company Lukoil the rights to explore and develop a key area for petroleum production, the newspaper Al Mal has reported, citing sources. The decision by the BRICS member comes a month after the US targeted Lukoil with fresh sanctions.

The Russian oil giant will invest a minimum of $22.5 million over a period of six years into the South Wadi Al-Sahel concession, Al Mal wrote on Monday. Unlike traditional bidding processes, the concession was awarded through a direct agreement between Egypt's Ministry of Petroleum and Lukoil.

Lukoil has not yet confirmed the deal to the Russian media.

The reported deal comes as part of several oil and gas development projects that the Egyptian government reached agreements with foreign companies about earlier this month. Totaling approximately $225.3 million, the projects include ventures in the Western Desert and North Sinai regions.

Lukoil is one of the largest publicly traded oil and gas companies in the world, accounting for around 2% of the world's oil production. It is Russia's largest privately owned company in terms of revenue.

Last month, the US imposed new sanctions on the Russian energy sector, targeting several oil firms, including Lukoil and its CEO, Vadim Vorobyov. Shortly after the restrictions were introduced, the company appointed a new CEO. Lukoil's founder, Vagit Alikperov, was placed under US sanctions in 2022, shortly after the escalation of the Ukraine conflict.

The company has been active in Egypt's energy sector for more than two decades. It is currently implementing the West Esh El-Mallaha production project in the Eastern desert, in which it acts as operator with a 50% stake. The company also owns a 24% stake in the Meleiha project in the Western Desert.

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Egypt became a member of BRICS - previously comprising Brazil, Russia, India, China, and South Africa - in 2024. Alongside Egypt, the group also welcomed as members the United Arab Emirates, Ethiopia, Iran, and Indonesia. Cairo has maintained a neutral stance on the Ukraine conflict, emphasizing the importance of dialogue and a diplomatic solution.

(RT.com)