Cyprus won't abandon gas search despite geopolitical challenges

Energy Minister George Lakkotrypis assured Wednesday that despite geopolitical challenges and recent incidents in Cyprus' Exclusive Economic Zone (EEZ), the government remained committed to exploiting hydrocarbon reserves in the Eastern Mediterranean.

In a speech at the Eastern Mediterranean gas conference in Nicosia, the Minister said that despite recent incidents regarding efforts to drill Block 3 and despite the Turkish provocations Cyprus faced, the country will continue to work with countries of the region to advance the interests of Cyprus and the region as a whole.

He added that if Cyprus was able to conclude the sale of Aphrodite’s gas to Egypt, liquefy it and then ship it to Europe, that would be the first Eastern Mediterranean gas reaching the EU.

“That will be a significant milestone which the Republic of Cyprus is committed to taking all the way,” he said.

Concerning the development of the Aphrodite gas field, the Minister said that the Republic is currently in commercial talks with Egyptian customers and terminals in Egypt. He also said that there have been bilateral conversations between governments of Cyprus and Egypt to put together the necessary framework to enable the sale of the gas of Aphrodite in one of the two LNG plants in Egypt.

He said there’s significant progress both on the commercial and the bilateral government side, adding that Nicosia had submitted to the EU the intergovernmental agreement for the framework of the pipeline between Aphrodite and Egypt and the EU will have to respond back to Cyprus government in a few weeks.

Lakkotrypis revealed that the government is at an advanced stage of discussion for the commercial sale of the gas.

“We remain committed to both the Egyptian government and also our partners in Cyprus and Egypt to try to find a conclusion in what is a very difficult equation considering the outside conditions in the market, both in terms of international prices of oil but also in terms of the rather hostile nature of development of the Aphrodite field because of the technical circumstances in the depth of the water”, he said.

Lakkotrypis also said that the drillings planned in Cyprus' EEZ for 2018, mainly in block 10 by ExxonMobil, would give a pretty good idea about the island's resources.

Replying to questions regarding Turkish President’s statement that Ankara will start drilling in the Eastern Mediterranean, Lakkotrypis said that Cyprus was cooperating with all the other countries in the region and would continue to do so, despite the provocative actions of one of its neighbours.

Asked if the Government feels the support of its European partners, he said that the presence of so many representatives of companies active or not in the Cypriot EEZ speaks for itself.

ExxonMobil with Qatar Petroleum has a licence agreement with the Cyprus government to explore block 10 for oil and gas as part of a third licensing round to exploit new offshore plots.

Block 10 is close to where Italy's ENI made a huge find in Egypt´s offshore "Zohr" field, raising hopes in Cyprus of more untapped wealth.

US firm Noble Energy made the first find off southeast Cyprus in 2011 in the Aphrodite field (Block 12), estimated to contain 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. Noble has handed over a 35 percent share to the UK's BG International.