HOUSTON-based Noble Energy yesterday said it could deliver natural gas ashore by 2014.
During a presentation at the Levant Energy Forum held in Nicosia, Lawson Freeman, senior vice-president of Noble’s International Division, said actual drilling would commence in the last quarter of the year.
“It will take about two months to drill this well,” he said.
Noble has a concession to explore for hydrocarbons in an offshore field south-east of Cyprus, known as Block 12. It has signed a production-sharing contract with the government.
Freeman said one of their proposals is to build a natural gas liquefaction plant here, where the excess gas could be exported to Europe and elsewhere – turning Cyprus into a hub. The plant would be ready to operate by 2019.
Hosted by the University of Cyprus and organised by Gulf Intelligence, the forum brought together industry players, policy makers and experts for a review of developments in the eastern Mediterranean, following massive gas finds in Israeli waters and strong indications of equally large reserves off the coast of Cyprus.
According to the US Geological Survey, the Levant Basin, an area which includes the coastal areas near Cyprus, Israel, Lebanon and Syria, holds an estimated 120 trillion cubic feet of undiscovered, recoverable natural gas.
The area additionally holds an estimated 1.7 billion barrels of undiscovered, recoverable oil.
Not 24 hours before Freeman’s comment, another senior Noble exec was telling newsmen here of his “excellent meeting” with the President. His company planned to commence drilling before the end of the year, he said.
Should Noble strike gold in Cypriot waters, a pipeline would need to be built to bring the fuel ashore in its raw, gaseous form.
But a law passed by the Cyprus parliament in 2007 allows for the use only of liquefied natural gas (LNG) coupled with the construction of a re-gasification terminal. As things stand, the legislation needs to change – a point highlighted by some of the forum participants yesterday.
The law came into being before indications that Cyprus might possess its own hydrocarbons, and as a result the government had in the meantime entered negotiations with Shell for a long-term supply of LNG to the island. But since the buzz created over Cyprus’ suspected natural wealth, the administration has kept everyone guessing on its intentions.
Costas Ioannou, chairman of the Natural Gas Public Company (DEFA), told forum delegates that DEFA was expecting directions from the government “very soon.”
The Cabinet, said Ioannou, would give the go-ahead for setting up a team of experts that would hold talks with interested foreign companies. But whether that could mean revisiting the Shell option, he did not explain.
And head of the Energy Service Solon Kassinis said he has suggested to the Commerce Minister amending the legislation, adding that the relevant ministry would be making a decision in a few weeks’ time.
Moreover, the governments of Cyprus and Israel would next week hold talks aimed at concluding a unitisation agreement between the two countries – although he added this was not an absolute prerequisite for drilling to start.
Kassinis also offered a tentative timeline for the next licensing round for exploration of the Cypriot blocks, placing it at the beginning of 2012.
“By 2014, we can have natural gas, I’m talking about our own natural gas, at low prices for the consumer,” Kassinis told reporters on the sidelines of the forum.
