THE exploration and exploitation of probable hydrocarbon reserves in Cyprus’s Exclusive Economic Zone requires knowhow and specialisation proportional to their size, qualifications which are currently not available on the island, a petroleum industry expert said.
As drilling in Block 12 has a “very high chance” of making a discovery of similar magnitude to that in Israel’s Leviathan and may therefore put Cyprus on the world energy map, the country must ensure the acquisition and transfer of knowhow in a similar way to how Norway acted when it made its discoveries in the North Sea, Pierre Godec — former senior manager at the French energy giant Elf and current director of Petro Resource Ltd., an energy company with operations in Cyprus — said.
The government must therefore hire personnel with specialisation in the oil industry capable of handling related matters in the future thus reducing its dependence on consultant firms, he said.
“It took Norway about 10 years to establish a strong ministry for energy, the national company Statoil which is now privatised, and they learned everything from scratch by hiring a few international experts and by establishing cooperation procedures with international operators and transfers of technology from them. For Cyprus to keep control over its future reserves and production, the same path will have to be followed, and it will also have to take some time” Godec who is also president of the French Trade Board in Cyprus said. “We are talking about world class discoveries, they are going to trigger a world class response and they will need to be dealt with in a world class manner”.
Competences and experience are more important than even “massive amounts of capital” if in the next decades, Cyprus wants to become a “major player on the world scene for gas production and export,” Godec said.
If Noble Energy is successful in Block 12 and goes ahead with a second round of oil and gas exploration in the Cypriot Exclusive Economic Zone, “it is highly probable that the world’s first league companies will be present with their big negotiation teams,” he added. “Facing them will be a totally different exercise,” compared to the first round, in which Godec negotiated with Cypriot authorities representing Petro Resources, which showed interest in Block 6 and Block 11.
The July 11 explosion in Mari which knocked out the Vassilikos power station may serve as an example of how much Cyprus has to learn in matters of safety, according to Godec. “Oil exploration and exploitation is a highly dangerous activity. In order to protect their own interests, oil companies have developed, in the last 30 years, massive safety training programmes, and a high safety consciousness at all levels of their organisations. The Mari accident shows that the concept of an integrated safety has not yet reached a sufficient and acceptable level in Cyprus, and this will certainly be a concern and challenge for the companies when they start operating here on a big scale,” he added.
Godec played down Ankara’s recent warmongering in response to the beginning of drilling in Cyprus’s offshore territory by Noble Energy. Even though it was “not surprising and it was consistent” with its traditional attitude, “this was a bluff, and the bluff is now being called,” he said.
