BP and XRG form Arcius Energy to boost Egypt natural gas production
Natural gas chart shows bullish breakout potential
BP and ADNOC’s subsidiary XRG have launched Arcius Energy, a joint venture targeting enhanced natural gas output in Egypt. BP holds a 51% stake, while XRG retains 49%. Arcius will develop critical gas fields, including Zohr—the Eastern Mediterranean’s largest gas reserve with 30 Tcf of estimated gas—whose production has suffered due to underinvestment and technical hurdles.
Arcius’ key assets include the Atoll field in North Damietta, operated by BP with a 100% stake, and several exploration concessions such as North El Tabya and North El Fayrouz. Additionally, BP confirmed a 10% stake in ADNOC’s Ruwais LNG project, expected to add 9.6 mtpa liquefaction capacity upon completion.
Natural gas chart (Nov 2024 - Dec 2024) Source: Trading View
Technical update: Natural gas gains bullish momentum
Natural gas prices climbed to $3.21, gaining 0.69%. Prices are consolidating near $3.39, supported by strong technical indicators. Resistance lies at $3.50 and $3.60, while support levels are positioned at $3.28 and $3.15. The 50-day EMA at $3.32 acts as a short-term barrier, while the 200-day EMA at $3.22 provides structural support.
Technical analysis shows a breakout from a cup-and-handle pattern, indicating a potential rally if prices breach $3.60. Increased winter heating demand could drive natural gas prices further upward in the coming months.
Egypt expands LNG import capacity
To counter declining domestic gas output, Egypt secured new Floating Storage and Regasification Units (FSRUs). The latest deal with New Fortress Energy boosts regasification capacity by 7.7 Bcm/year, with operations expected by late 2025. This addition follows a similar agreement with Höegh LNG for the deployment of the Hoegh Galleon FSRU.
Previously, we discussed natural gas prices facing resistance near $3.14 due to improved European gas supplies and U.S. policy shifts. These factors continue to influence the market outlook.
