Failure of the initial offshore exploratory drilling by an Italian-Korean consortium to find significant quantities of gas should not be a cause for disappointment, President Nicos Anastasiades said after his Cabinet meeting on Tuesday following a three-week absence in New York to fix his heart’s mitral valve.
The Energy Ministry had said on Friday that the SAIPEM 10000 rig belonging to the ENI-Kogas venture drilled to a depth of 5,800 meters at the Onasagoras prospect without success but that new drilling will begin elsewhere within the offshore Block 9 where the consortium has identified six potential gasfields.
Anastasiades cited several examples where initial drills did not produce significant resources and referred to a large gas field off the coast of Norway where substantial gas reserves were only discovered on the fourth attempt.
He added that initial prospecting at Israel’s Leviathan and Tamar fields near the Cyprus Exclusive Economic Zone (EEZ) also did not point to encouraging results, but this was later reversed through major gas finds there.
So far, Cyprus’ proven natural gas reserves offshore have been limited to a field in Block 12, where US-based Noble Energy has discovered between 3.6 trln and 6 trln cubic feet of gas – not enough for a land-based liquefaction facility.
However, Anastasiades said that the government’s decision for the construction of a liquefied natural gas (LNG) terminal is still on the table, but stressed that this decision is subject to certain conditions.
He said that when the government took its initial decision it took into consideration information about a great amount of hydrocarbon reserves, which made this investment a viable one.
The government has repeatedly stressed that the decision to build an LNG terminal will be finalized once the quantities for hydrocarbon reserves found in Cyprus’ EEZ allow such an investment to be viable.
However, recent talks with Egypt and Israel could pave the way for natural gas to be piped straight to either country, either for liquefaction and local consumption or for export, possibly to western Europe that has seen significant supplies from Russia diverted to other markets over the crisis in Ukraine and European Union sanctions on Moscow.
