Cyprus: Stepping on the gas

Italian energy giant ENI will speed up its exploratory activities in Cyprus’ Exclusive Economic Zone (EEZ), as it has been further encouraged by developments in the Cyprus problem.
The pledge also comes after US President Barack Obama has given his full backing to the peace process and the government’s right to exploit the island’s energy resources, said Commerce Minister said George Lakkotrypis.
He said that a Memorandum of Understanding for the construction of an onshore terminal will be signed with the company within the next few days.
Develops emerged after the President Anastasiades’ visit to the Vatican at the weekend.
During his stay Lakkotrypis met with the leadership of Italian company ENI to discuss their plans for exploratory activities in Cyprus` EEZ.
They also discussed the issue of the Memorandum of Understanding for the liquefaction terminal in Cyprus.
The Memorandum is ready, it has been agreed on, and there are some formalities left, such as its approval by the Council of Ministers, so that we can proceed to its signing in the next few days,” Lakkotrypis said.
He said that the MoU states the intention of the company to cooperate with the government for the construction of an onshore gas terminal at Vassiliko.
“They have been encouraged by the latest developments in the Cyprus problem and in particular by the statement of Mr. Obama, it has encouraged them to proceed freely in their activities, because we are talking about hundreds of millions of euros.”
Lakkotrypis said that Cyprus needs to uncover more natural gas deposits to make an LNG plant viable.
“We are waiting for the discovery of more natural gas, so that we can proceed with this planning. The Memorandum includes a provision for the inclusion of ENI in the construction of the terminal.”
Similar agreements have been signed with US firm Noble as well as with the French company TOTAL.
Lakkotrypis said that “the initial planning for the exploratory drillings was for the third and fourth quarters of 2014.
“ENI is now making a great effort to speed up and to begin the exploratory drillings towards the end of August 2014, something that is very important because it will expedite the procedures for the discovery of more natural gas.”
Preliminary results of a Noble Energy appraisal well for natural gas in Block 12 estimate hydrocarbon reserves between 3.6tcf and 6tcf with a gross mean resource of 5tcf.
Noble operates Block 12 with a 70% working interest with Israeli firms Delek and Avner each owning 15%.
Last June Cyprus, Delek and Avner signed an MoU on the construction of a Liquefied Natural Gas (LNG) terminal.
The ENI – KOGAS consortium, which has signed a contract for gas and oil exploration in blocks 2, 3 and 9 plans to drill in the third quarter of 2014, while Total, which has signed a contract for blocks 10 and 11, is to proceed with drilling in the first quarter of 2015.

incyprus