THE CABINET yesterday decided to launch the second licensing round for offshore oil and gas exploration, authorising the trade and industry minister to prepare the ground for the official announcement.
At the same time, Turkey’s state energy company TPAO signed an accord with Shell yesterday for hydrocarbon exploration and production in the Mediterranean and southeastern Turkey and said other major international firms were interested in exploring nearby.
Turkey is opposed to Cyprus and Israel drilling. Its Energy Minister Taner Yildiz said yesterday that Cypriot and Israeli energy exploration was illegal and that any discoveries in the east Mediterranean basin should be equally shared.
But Cyprus has said it would not be deterred by Turkish threats over its drilling and would proceed as planned with a second round.
“After today’s decision to start the second round of licensing, the government once more stresses its determination to exercise its sovereign rights in the Republic of Cyprus’ exclusive economic zone, always according to international law,” government spokesman Stefanos Stefanou said.
Stefanou said it would take “one to one and a half months” for the invitation for the submission of proposals to be formally published.
Consultants would short-list companies which would be referred to the energy minister and then the cabinet, which will take the final decision, he said.
Stefanou said it would take up to six weeks for authorities to prepare the necessary documentation and the invitation for the public submission of proposals to be published. Companies would then have three months to submit proposals to consultants. The consultants would subsequently short-list companies and make recommendations to the energy minister. The cabinet will take any final decision, Stefanou said.
Asked whether the process would be concluded within 2012, he said: “I wouldn’t rush to predict when this process will be done, there is a timeframe for this in the law and in EU directives. Today the cabinet decided that these procedures be set in motion for the second licensing round.”
The second round will include 12 so-called blocks stretching from the south west to the south east of the island.
An additional block is already under concession to US based Noble Energy which launched an exploratory gas drilling in September.
The field neighbours Noble’s Israeli concession, dubbed Leviathan, which is expected to yield some 16 tcf of natural gas.
Further east lies Tamar, another field off Israel that holds an estimated 8.6 tcf.
The Cypriot field lies 34 kilometres from Leviathan and 60 from Tamar.
Noble said recently that the Cypriot concession holds an estimated 3.0 to 9.0 trillion cubic feet (tcf) of gas.
The prospect has a 60 per cent probability of geological success, the company added in what was its first public appraisal of the Cypriot gas prospect; such estimates are often revised upwards or downwards.
“The exploratory drilling was preceded by various specialised searches with specific findings, which allow for optimism,” Stefanou told reporters. “We are very close to the completion of this exploratory drilling and I believe that very soon we would be able to say more.”
The decision to search for oil and gas has angered Turkey, which said Cyprus has no authority to explore for hydrocarbons as long as the island’s division is not resolved.
Ankara has sent its own research vessels with a military escort to the region, and says it will carry out exploration of its own unless Cyprus backs down.
