By end of 2018 and following the exploratory wells by the consortium of ExxonMobil/Qatar Petroleum in block  10, Cyprus will have a complete picture of its natural gas reserves and will take its decisions concerning monetization, Minister of Energy, Commerce, Industry and Tourism Yiorgos Lakkotrypis has said.

The consortium announced it will carry out two drillings in block 10 in the second half of 2018.

The new drilling activity comes after an exploratory well by French TOTAL in block 11, which, according to Lakkotrypis, although did not reveal commercially viable gas reserves, proved that the geologic model, which lead to the discovery of the giant Egyprian Gas field Zhor, “works for Cyprus.”

“By end 2018 we will have concluded what I called exploration round 2.0 which started with the discovery of Zhor completed and that is the moment we will have a pretty good idea” of Cyprus’ gas reserves, the Cypriot Energy Minister told a panel discussion during the 2017 Cyprus Maritime Conference.

“That will be the moment when Cyprus will take its decision about monetization,” he said.

Furthermore, Lakkotrypis said Cyprus maintains all options open, that is, the construction of an onshore LNG plant, a pipeline connecting Cypriot reserves with Egypt’s two LNG plants in Idku and Damietta or a floating LNG facility.

“Exxon/Qatar are not shy in saying that should they discover sufficient quantities they will build an onshore LNG plant,” he said.

Replying to questions, Lakkotrypis referred to the plans for the connection of the Eastern Mediterranean natural gas reserves with Europe through a pipeline from the Levantine basin to Cyprus, Crete, Greece to Italy, for which the EU is funding its feasibility study.
He added that Cyprus will also apply for infrastructure funding through the EU Connecting Europe Facility.

Lakkotrypis also said that there is another project for a pipeline called Euro – Africa connecting Egypt with Europe, noting however that this project is only at the design phase.

Responding to a question on the settlement of the Cyprus problem, Lakkotrypis acknowledged a solution to the problem of the island, that has been divided since 1974 when Turkey invaded and occupies 37% of its territory ever since, “would not only normalise relations between Cyprus and Turkey but also with the rest of the region.”

But he pointed there is an incompatibility between Turkey and the rule of law.

Recalling that a Turkish Minister said Ankara wants to maintain troops on Cyprus to protect the constitutional order, he said “in Europe (to uphold the Constitution) we go to the Supreme Court.”

Speaking during the discussion, Elfriede Covarrubias, of the DNVGL oil and Gas in Mediterranean, there is a momentum for the construction of LNG plants for Cyprus as capital expenditure and operative expenditure are declining due to future more efficient technology but added the key period is up to 2025.

“We have almost 2,000 gas processing in the world. Demand will stabilise after 2045,” she added.

She also said that the oil and gas share of global energy demand which is currently at 50% is expected to decline to 44% by 2045.
On his part, George Papanastasiou, managing director of VVTV Vasilikos fuel terminal said a survey by the US Geological Survey department in 2010 revealed that the natural gas reserves in the Levant basin account for 9.8 billion cubic metres, noting however there is a lack of the necessary infrastructure in the region “which created a gas bonanza.”

He said Cyprus shouldn’t lose its patience following the insufficient discovery of natural gas by TOTAL, recalling that it took Israel years before discovering the huge gas reserves of Tamar and Leviathan.

Papanastasiou also noted that the potential destinations for gas discoveries in the eastern Mediterranean is the liquefaction plants in Idku and Damietta in Egypt.