12° Nicosia,
19 June, 2024

Cyprus on verge of becoming LNG hub as talks of Israel pipeline intensify

Promising prospects emerge as Cyprus explores LNG transformation in partnership with Israel

Apostolis Tomaras

Apostolis Tomaras

The announcements made by the Prime Minister of Israel, Benjamin Netanyahu, regarding a pipeline that will transport natural gas from Israel's Exclusive Economic Zone (EEZ) to Cyprus for liquefaction (LNG) and export to European markets, have the potential to create a new energy landscape in the region. Netanyahu's revelations about discussing the construction of an underwater gas pipeline with the President of the Republic of Cyprus, Nicos Christodoulides, undoubtedly open up new prospects for Cyprus to further strengthen the Eastern Mediterranean's ambition of becoming an energy hub for European energy markets.

The announcements that the pipeline from Israel is being discussed coincide with the changes that seem to have been decided in Nicosia in order to end the stagnation observed in recent years in the commercial exploitation of deposits, such as the "Aphrodite" field. Based on the plans being made, Israel is not opposed to the prospect of a portion of Israeli natural gas being exported to Cyprus for liquefaction and then transported to markets (LNG). If and when the discussions move to the stage of the agreement, it will essentially make Cyprus not only a producer of natural gas but also an LNG processing country, thus ending the monopoly that Egypt currently holds in the region with its two terminals in Idku and Damietta.

LNG in Vasiliko

The exact energy plans of the Cypriot government were revealed to "K" by the Minister of Energy, George Lakkotrypis. At the core of the new policy is Cyprus transforming into a liquefied natural gas (LNG) export hub, with processing taking place in facilities to be built in Vasiliko. This option has been available since the beginning of the initial explorations in Block 12 of the Cypriot EEZ (2011). Based on what Mr. Lakkotrypis had revealed to us, the entire project will rely on a hydrocarbon processing technology that has been developed in recent years.

Modular LNG essentially serves the ambitious goals of Cyprus, regardless of the fact that it involves non-permanent infrastructure, unlike Egypt's liquefaction terminals. As explained by Mr. Papanastasiou to "K," it involves mobile LNG facilities, with one key difference—they are not offshore but located on land. As described by the Minister of Energy, they are large LNG liquefaction containers that can be transported to other areas after the project is completed. "Modular LNG is a technology that has been developed in the last 10 years and has rapidly evolved in the last five. Essentially, it refers to mobile liquefaction units," it is emphasized. According to Mr. Papastasiou, this specific technology is more economically advantageous than floating liquefaction facilities (FLNG). According to the Minister of Energy, the mobile LNG units can be deployed in the designated area in Vasiliko and in the region planned to be transformed into an energy hub.

Modular LNG

A first taste of the prospects for Cyprus to become a liquefied natural gas (LNG) processing country will be given at the end of May during an event in Nicosia. It will be an open informational event inviting international companies active in the energy sector. The event will be called "Modular LNG Gateway to Cyprus." After the event, as emphasized by the Minister of Energy to "K," participating companies will have the opportunity to hold private meetings and express their interest.

[This article was translated from its Greek original]

Cyprus  |  Israel  |  energy

Business: Latest Articles