Egypt has signed its first contract to extract gas by fracking in a deal with Shell and Apache which includes investments of up to $40million.
The oil ministry said it was part of efforts to boost output amid tumbling oil prices.
The agreement is for three wells in the Abu al-Ghardeeq region of the Western Desert, about 200 km west of Cairo.
A spokesman for the oil ministry said: “The project will require horizontal drilling and hydraulic fracturing, which is the same as the shale gas production method used in the United States.”
The head of Egypt’s state oil company signed the deal with a senior executive of Apache and Shell Egypt.
In November, Egypt reached an agreement with Norway’s Hoegh LNG for an LNG import terminal to be installed at the end of March.