Eni and Total will not target block 7 as main priority in energy search

Eni and Total were not scared off from block 7 due to Turkish threats but decided there were more interesting and mature targets to tackle first, said Energy Minister Yiorgos Lakkotrypis.

The Minister was responding to reports the consortium of energy companies Italy’s Eni and France’s Total were withdrawing from block 7 of Cyprus’ Exclusive Economic Zone, after provocations by Turkey in that area.

Turkish drillship Yavuz returned to Cyprus’ EEZ, to carry out drilling operations inside block 7, located off the southwestern coast of Cyprus.

Block 7 has been licensed by the government to Total and Eni for exploration.

Last month, Brussels approved a regime of restrictive measures targeting those responsible for illegal drilling activity in Cyprus waters.

Lakkotrypis told the Economist summit that the decisions of the companies were made based on geological data, and they would start with the most interesting and mature targets they find.

He added that usually it takes up to two years between licensing and first drilling and decisions would be based on the discovery of the “Glafcos” deposit in block 10. There was no intention, he added, to start drilling in block 7.

Glafcos in block 10 – licensed to ExxonMobil and Qatar Petroleum - was one of the biggest global discoveries in 2019 with 5-8 trillion cubic feet of gas and the largest so far in Cyprus’ EEZ.

Lakkotrypis said the “Aphrodite” deposit in block 12 was in the final stages of an agreement on a development and production plan, exploiting the availability of Egyptian liquefaction terminals in Idku, something that could be a first step for the gas corridor of the Eastern Mediterranean.

The Minister also said that an extensive drilling programme was expected between the end of the year and early 2020.

Referring to renewable energy sources, Lakkotrypis said that the ministry had run several programs that would allow it to have about 20% installed capacity in 2020, exceeding the targets set by the EU.

For the remaining 80% of power generation, there is an effort to bring natural gas to the island, which is a cleaner form of energy and could serve as a transitional fuel in a future with renewables.

ExxonMobil’s Vice-president, for exploration and new ventures for Europe, Russia, Caspian, and MENA, Don

Bagley said that with their partners Qatar Petroleum, they had made a significant discovery in block 10 and were looking forward “to getting out there this year to appraise that discovery and help us with the commercialization decision”.

Total’s Vice-president for North Africa and MENA division Elias Kassis spoke about the growth in demand of LNG and the rise of renewables worldwide. He said the company’s vision was to deliver clean and reliable energy in the market.

He said that Cyprus is located at the crossroad of an area between Europe and the Middle East with prospects for LNG plants, large projects and more explorations.

Executive vice-president for exploration projects of Eni Aldo Napolitano pointed out that the company was present in five blocks in Cyprus and was participating in two other blocks that are operated by Total.

“We have been in the exploration of Cyprus since the early stages and we have already drilled three wells as operator and participated in a fourth well operated by Total, with a gas discovery,” Napolitano said.

“We are committed to the development of new resources in Cyprus and we will continue our activity next year with our joint venture,” he added.