There are encouraging indications for oil discoveries in the offshore area of Cyprus, Energy Minister Giorgos Lakkortypis said on Monday, expressing cautious optimism for further natural gas discoveries in Cyprus’ exclusive economic zone.

Addressing the “Global Offshore Technology Conference and Exhibition” conference, in the southern coastal city of Limassol, Lakkotrypis said that Cyprus` exploration activity will continue in 2014, with one more exploration well for gas in Block 12 and possibly another appraisal well in the Aphrodite field.

Texas-based Noble Energy received concessions for drilling in Block 12. Following the appraisal process, the company confirmed in October 2013 the presence of an estimated mean of 5 Tcf of natural gas.

He added moreover that exploration activities are also well underway in the other five licensed Blocks and the first exploration drilling is expected in the third quarter of 2014.

“The Eastern Mediterranean is quickly becoming a new and very promising frontier region for oil and gas production” Lakkotrypis noted.

He spoke moreover over the decision to construct an onshore LNG terminal, at Vassilicos on the southeastern coast of Cyprus, with initially one LNG Train of 5 million tons per annum.

The Minister referred to recent results lowering the estimates of resources, and their impact on the project`s viability, he said however that “the government of Cyprus is convinced that the onshore LNG remains the best strategy forward”.

According to Lakkotrypis, a scalable LNG export terminal will bring the greatest overall economic benefits to Cyprus and is the most suited for multiple discoveries as it can be easily expanded.
The Minister said finally that a Cyprus LNG terminal can be a hub for regional cooperation between the countries of the Eastern Mediterranean and serve as a direct link between the region and the EU.

Cyprus is currently developing natural resources discovered within the Republic’s exclusive economic zone (EEZ), while several international companies are involved in hydrocarbon exploration and exploitation activities.

Following the first licensing round in 2007, Cyprus signed an Exploration and Production Sharing Contract with Noble Energy International Ltd, granting the company an exploration license for Block 12. Israel’s Delek and Avner also joined this license in February 2013.

In February 2012 a second licensing round was launched. As a result, Cyprus entered into another five Exploration and Production Sharing Contracts, granting three exploration licenses to Eni and KOGAS for Blocks 2, 3 and 9, in January 2013 and two exploration licenses to Total E&P Cyprus for Blocks 10 and 11, in February 2013.