Cyprus announced that the first appraisal well in its offshore gasfield near Israeli waters has indicated reserves of 3.6-6 trln cubic feet, with an average 5 tcf, below the initial estimates in 2011 by licensee Noble Energy.
Energy and Trade Minister George Lakotrypis said on Thursday that the Houston-based exploration and production company will probably conduct a second appraisal drilling in 2014, once a new rig has been secured.
A similar announcement was expected to be made on the New York Stock Exchange by Noble (NYSE:NBL).
However, the Minister added that plans for a land-based LNG plant to regassify the natural gas for export remain unchanged and that Cyprus will build the plant to serve Noble’s upstream output, as well as operators of the other five offshore gasfields, the Italian-Korean joint venture ENI-Kogas and French Total.
Lakotrypis said that the net profit from exports is estimated at 12-18 bln euros, with a gross value of 30 bln euros, based on a conservative mean amount of 4.5 tcf.
The minister said that Noble and its junior partners from Israel, Delek Drilling and Avner Oil Exploration, concluded the A2 appraisal drill at a depth of 5,700 metres and 6 kilometres north east of the first A1 exploratory drill in 2011.
“The LNG terminal remains a strategic priority for us,” said Noble’s manager of the Cyprus operations, John Tomich, adding that the A2 appraisal well “confirmed the presence of very large quantities.”
Noble, Delek and Avner have signed a memorandum of understanding with the Cyprus government for the construction and operation of an LNG plant, probably by 2018, that has already secured the commitment of two additional production trains from ENI-Kogas and Total.
Meanwhile, Lakotrypis said that even with the revised estimates, the find is still regarded as the third biggest in the Levantine Basin of the eastern Mediterranean that includes Israeli gasfields, as well as potential gasfields further north within Lebanese waters that have yet to be explored.
He added that every 0.5 tcf corresponds to 25 years of production of the Electricity Authority of Cyprus.
The initial find in Noble’s Block 12, named ‘Aphrodite’, estimated gross mean resources of 7 tcf, while ENI/Kogas will start its own hydrocarbons exploration in blocks 2, 3 and 9 in the Cyprus Exclusive Economic Zone (EZZ) next year, as will French Total for blocks 10 and 11.
Recent finds and start of production within Israeli waters, as well as Lebanon’s plans to invite exploration companies to search for natural gas or crude oil within its own territory, has made the eastern Mediterranean one of the most promising natural gas fields, with total discovered gross mean resources in the Levantine Basin alone estimated to be approximately 38 tcf.
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