Head of the Energy Department of the Commerce, Industry and Tourism Ministry, Solon Kassinis, has submitted proposals for cooperation with Israel in constructing a liquid natural gas plant and a pipeline for which political decisions are still to be taken from Israel and Cyprus.
Kassinis made the remark during the 4th Summit on Energy, organized by the “Economist” held today in Nicosia.
In the discussion on “The status of energy exploration in Cyprus and its geostrategic significance for the region”, Kassinis referred to the situation as it stands in the field of energy and the efforts which the Republic of Cyprus is undertaking in finding hydrocarbons in its Exclusive Economic Zone (EEZ). He said that by finding and exploiting its natural gas, Cyprus will be able to modernize its economy, improve its balance of trade and create new vacancies. Cyprus, he added, can become an area of viable development.
He also referred to the agreement with the Houston-based Noble Energy which is carrying out exploratory drilling off Cyprus’ south-eastern coast, noting the agreement provides for exploiting Block 12 for three years by Noble, with a provision to extend it for another two. However it also stipulates that the area which the company is exploiting will decrease by 20% annually, as a lever to exert pressure on the company, to use the block quickly and effectively.
Yeoshua Stern, Director, Natural Gas Authority, Israel said his country has saved 5.6 billion euro from the exploitation of natural gas while it anticipates 8 billion euro profit from the exports it will make. He also said that a ministerial committee has been set up to examine the issue of security in providing natural gas and the exports strategy, adding that final decisions will be taken around the end of April 2012.
Stern also presented Israel’s picture noting that his country has constructed nine wells in 2011, there are plans for another 12 in 2012-2013 and a further five later on.
George Shammas, Chairman of the Cyprus Energy Regulatory Authority said the Electricity Authority of Cyprus (EAC)’s aims are ambitious to operate units four and five that have been destroyed at the explosion at Mari, before July 2012. He said units one, two and three will not be able to operate within 2012, expressing the hope they will be able to do so in 2013.
He described as an achievement the fact that power cuts managed to stop from 12 August, adding that a part of the cost was passed to consumers and from September 2011 an additional 6.96% charge was imposed on bills which will be valid for ten months.
Costas Ioannou, Executive Chairman of the Natural Gas Public Company of Cyprus (DEFA) said the company has secured 10 million Euro from the EU to construct a natural gas network infrastructure.
Ioannou further reminded that from January 2014 the electricity market will be liberalized, adding that as a result of the exploratory drilling underway, there is an increasing interest to secure licenses.
Eirik Rasmussen, Director of PwC in Norway in his address, advised delegates on how to create companies to exploit natural gas. He said that a strategic planning should exist, good practices maintained and that ways should be found to make Cyprus a competitive and attractive destination for companies.
Cyprus, which joined the EU in 2004, has been divided since 1974, when Turkey invaded and occupied its northern third.
Following a decision by Nicosia to begin natural gas and oil exploration in its exclusive economic zone, Ankara has deployed warships in the Eastern Mediterranean and has signed an illegal agreement with the Turkish Cypriot regime in occupied Cyprus to delineate what it calls continental shelf.
Peace talks are currently underway to find a negotiated settlement that will reunify the country, under a federal roof.
