Cyprus sees new offshore gas exploration push

The field sits adjacent to a Cyprus block licensed to France’s Total.

Cyprus sees new offshore gas exploration push

World Bulletin / News Desk

Energy giants are showing renewed interest in a third licensing round for oil and gas drilling off southern Cyprus, the government said Wednesday, as officials from France's Total met President Nicos Anastasiades.

Ahead of a July 22 deadline for expressions of interest for offshore drilling rights, the talks in Nicosia came a day after the president met with representatives of Italy’s ENI.

"We went ahead with the third licensing round due to increased interest in this region and we see from the initial interest that the government’s decision was vindicated," government spokesman Nicos Christodoulides told reporters.

“We hope that the general increased interest that exists at this moment will translate very specifically with the ending date for expressions of interest," he added.

He said the president discussed with Total the third licensing round and how gas finds in the region can help provide energy security for Europe.

Nicosia has put three blocks (6, 8, 10) up for grabs close to where ENI made a huge find in Egypt’s offshore Zohr field that could hold 30 trillion cubic feet (850 billion cubic metres) of gas.

Total officials adopted a "wait and see" approached when asked by reporters whether the company would bid for one of the blocks up for grabs.

The record Zhor find last August has raised hopes that there is more untapped wealth to be found off Cyprus.

US firm Noble Energy made the first find off the southeast coast of Cyprus in 2011 in the Aphrodite field (Block 12), estimated to contain around 127.4 billion cubic metres (4.54 trillion cubic feet) of gas.

Israeli firms Delek and Avner have a 30-percent stake in the venture, while Noble has handed over a 35-percent share to the UK’s BG International.

Block 12 has been declared commercially viable but an action plan on the next steps has yet to be finalised.

Italian-South Korean venture ENI-Kogas has so far failed to discover any exploitable gas reserves in deep-sea drilling off the island.

ENI has the right to exploit three blocks (2, 3 and 9) in Cyprus’ exclusive economic zone that borders Egypt’s gas fields.

On Tuesday, ENI chief executive Claudio Descalzi said exploratory drilling off the island's south coast will "for sure" begin next year.

Cyprus needs to find more gas reserves to make a planned onshore terminal financially viable as it seeks to become a regional energy player.

It had planned to build a liquefied natural gas plant that would allow exports by ship to Asia and Europe, but the reserves confirmed so far are insufficient to make that feasible.

Cyprus and energy-starved Egypt are hoping to transfer gas from the Aphrodite field to Egypt via an undersea pipeline, while EU member Cyprus hopes to begin exporting gas, and maybe oil, by 2022.

Nicosia has ruled out the possibility of an Israeli pipeline to Turkey via Cyprus before the island's four-decade division is resolved and ties with Ankara are normalised.

Güncelleme Tarihi: 06 Temmuz 2016, 17:19