The companies’ approach to gas exploration in Cyprus’ offshore blocks is far more “aggressive” than Noble Energy’s on Block 12, commerce minister Neoclis Sylikiotis said yesterday.

Talks are ongoing with the companies selected for the offshore blocks in the second licensing round; yesterday authorities met again with officials from the ENI-Kogas consortium to discuss the latter’s bids for blocks 2, 3 and 9, followed by a meeting with the France’s Total regarding blocks 10 and 11. The government hopes to conclude these negotiations as fast as possible.

Sylikiotis informed MPs that talks with the ENI-Kogas partnership were progressing well, adding that the two sides are on the verge of agreeing their respective percentages in a production-sharing contract.

Agreement still had to be reached on some individual aspects of the consortium’s economic proposal before a contract could be drawn up, he said.

“We are slightly further behind in negotiations with Total for blocks 10 and 11,” he added.

The experience of Total and of ENI-Kogas in deep-water drilling and their technical know-how meant they could proceed faster than Noble has on Block 12.

“Their proposals could be described as being more aggressive than Noble’s,” Sylikiotis said.

Both Total and ENI-Kogas have promised to carry out two drills within the first three years of being awarded a licence, compared to the one drill completed by Noble in the space of approximately three years since being awarded the licence for Block 12.

Sylikiotis said also the two consortia would conduct extensive seismographic and three-dimensional surveys of the seabed.

In the meantime the government and Noble Energy are engaging in talks regarding the monetisation of Block 12 and the construction of a natural gas liquefaction plant.

Sylikiotis said that, in order for the LNG terminal to be ready by 2019, the vital groundwork – finding investors for the plant as well as future buyers for the gas – should be wrapped up this year. The LNG plant itself would cost around €7 billion to €8 billion.

According to the minister, authorities have already completed the land development plan for the project, which will be located at Vassilikos near Limassol. The plan envisages the construction of three LNG trains (liquefaction and purification facilities), making the terminal one of the largest in the world.

On Block 12, licensed to Noble in the first licensing round, Sylikiotis said the Houston-based company would carry out appraisal drilling in April.

Source: Cyprus Mail