The cabinet has named the Cypriot team that will conduct talks with a US-Israeli partnership on the development of natural gas within offshore Block 12 as well as the construction of a gas liquefaction plant on the island.

The members of the team are: Stelios Chimonas (chairman), permanent secretary at the trade and energy ministry; Nora Nicolaidou, state’s attorney; Stelios Koundouris, treasury accountant; Eleni Vasiliadou, chairman of the Natural Gas Public Company; Odysseas Michaelides, head of the department of control, ministry of communications; and a representative from the Cyprus National Hydrocarbons Company.

According to an official announcement, the team’s task will be to negotiate the “advent of natural gas from Block 12…as soon as possible” and “the construction of an Liquefied Natural Gas plant at Vasilikos and the drafting of any additional agreements that may be required for the construction and operation of the plant.” Also participating in the team’s meetings will be observers from the Attorney-general’s office andthe Auditor-general’s office.

Talks to hammer out the details are expected to last six months, with a target date of December 31, 2013 specified for the completion and signing of a follow-up agreement.

Last month the government signed an MoU with Noble and Israel’s Delek and Avner, a preliminary accord that is hoped will lead to a final deal setting up a joint venture between the parties – a special-purpose vehicle seeking investors for the estimated €7 to €8bn LNG plant. That deal was the first in a series of agreements which will be required for the implementation of the project.

Texas-based Noble, operator of the Block 12 concession, has yet to declare commerciality on the prospect and to take a final investment decision (FID) for selling the gas – the key step in developing the mooted LNG project. According to officials, the US energy company is expected to make its FID in 2015 or early 2016.

On another front, negotiations are dragging on between the Natural Gas Public Company (DEFA) and preferred bidder Itera. Cyprus wants to import limited quantities of natural gas for its own domestic electricity needs until such time as its own estimates come on tap.

Source: Cyprus Mail