En­ergy Min­is­ter expects to hear from To­tal about EEZ ex­plo­ration

Financial Mirror (Cyprus) - - FRONT PAGE -

En­ergy, Commerce, In­dus­try and Tourism Yiorgos Lakkotrypis said he expects some news this week about To­tal re­new­ing its ex­plo­ration li­cense for block “11” of Cyprus’ Ex­clu­sive Eco­nomic Zone (EEZ).

In an in­ter­view with the Cyprus News Agency, Lakkotrypis said that “I hope that we will have some news this week. We are now wait­ing for the com­pany to no­tify us of­fi­cially whether it will re­new its con­tract for block “11”, the first pe­riod of which ex­pires in Fe­bru­ary 2016,” he said.

He added that com­pany of­fi­cials, both in their vis­its in Cyprus, and dur­ing their meet­ings with Pres­i­dent Ni­cos Anas­tasi­ades have ex­pressed their in­ter­est in more blocks within the Cyprus EEZ. There is also in­ter­est, as he said, by other com­pa­nies that op­er­ate in Cyprus’ EEZ or have bought the coun­try’s ge­o­log­i­cal data dur­ing the two li­cens­ing rounds for ex­plo­ration rights in 2007 and 2012.

Cyprus’ gov­ern­ment has is­sued ex­plo­ration li­censes for blocks 12 (No­ble En­ergy), 10 and 11 (To­tal) and 2, 3 and 9 (ENI-KO­GAS). But To­tal had aban­doned its li­cense for Block 10 as its ex­ploratory drills came up dry.

How­ever, Block 11 is adjacent to Egypt’s re­cent record finds in the Zohr gas­field.

Lakkotrypis also said that the en­try of BG as a share­holder in Block 12 may ac­cel­er­ate and im­prove the de­vel­op­ment of the “Aphrodite” gas­field.

He said that this means that a po­ten­tial buyer, who man­ages and owns one of the liq­ue­fac­tion ter­mi­nals in Egypt, is now in­volved in the de­vel­op­ment of “Aphrodite”.

“Based on the de­vel­op­ment and pro­duc­tion plan filed by the No­ble-Delek con­sor­tium for “Aphrodite” a few months ago, the first pro­duc­tion is ex­pected in 2020”, he said.

He added how­ever that BG is now ex­pected to ex­am­ine the de­vel­op­ment plan to see if it can bring any im­prove­ment that will al­low the ex­trac­tion of gas ear­lier and more cheaply.

What is now ex­pected and is un­der ne­go­ti­a­tion, said the En­ergy Min­is­ter, is the trade agree­ments be­tween the part­ners in block “12”, the Cyprus Hy­dro­car­bons Com­pany and the po­ten­tial buy­ers in the Egyp­tian mar­ket. The Min­is­ter stressed that as the Egyp­tians told the Cypriot side dur­ing a visit to the is­land a few weeks ago, their needs in nat­u­ral gas are very high, de­spite the dis­cov­ery of Zohr field in Egypt’s EEZ and that there are still in­ter­ested in Cyprus’ de­posits both for ex­ports through their liq­ue­fac­tion plants, but also for their in­ter­nal consumption.

Lakkotrypis also re­ferred to the po­ten­tial buy­ers of Cyprus gas.

“One is EGAS for Egypt’s in­ter­nal consumption and the other is BG or Union Fenosa that man­age the other ex­ports ter­mi­nal,” he said.

Fur­ther­more, Lakkotrypis re­ferred to the re­assess­ment of the po­ten­tial of Cyprus’ EEZ by the French con­sul­tants of the Gov­ern­ment, in light of the new model formed af­ter the dis­cov­ery of Zohr field. As he said, the fi­nal re­sults are ex­pected in a few weeks.

Mean­while, the co­op­er­a­tion be­tween Cyprus and Is­rael con­tin­ues, and is a strate­gic re­la­tion­ship, said the Min­is­ter, adding that “it is cer­tainly not af­fected by the re­la­tions of other coun­tries.”

In­vited to com­ment on the re­la­tions be­tween Tur­key and Rus­sia and whether this will push Tur­key to turn to Is­rael for its en­ergy needs, he said, “the in­ter­est of the Turk­ish com­pa­nies for Is­rael’s gas mar­ket is not some­thing new. We have seen it un­fold in the past”, he said, adding that they will wait to see whether this cri­sis in Tur­key- Rus­sia re­la­tions would be ex­tended in their en­ergy re­la­tions too.

Re­gard­ing the tourism sec­tor and how it is af­fected by devel­op­ments in the re­gion, Lakkotrypis said that any new devel­op­ments should be ex­pected in the new year.

“This year we seem to have a flow of tourists in Novem­ber, which was chan­neled, un­for­tu­nately, from Egypt to Cyprus. I say un­for­tu­nately, be­cause we pre­fer our part­ners to be strong both eco­nom­i­cally and po­lit­i­cally, and cer­tainly we would not ex­change this with sev­eral hun­dred tourists,” the Min­is­ter said.

As he said that af­ter the in­ci­dent in Sharm El Sheikh, there was an in­creased tourist flow in Novem­ber com­pared to last year.

“For 2016 the con­tacts have just be­gun, and are in­tense par­tic­u­larly in the tourist sec­tor, so as to see the in­ter­est and how this trans­lates into tourist ar­rivals and rev­enue for Cyprus,” he said.

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