Cyprus and Israel agreed Monday to resolve speedily a long-running dispute on exploiting a natural gas reservoir that straddles the maritime boundaries of both countries, energy ministers said.
Israeli Energy Minister Karine Elharrar held discussions in Nicosia with her Cypriot counterpart, Natasa Pilides, to end a decade-long row over exploiting a joint gas reservoir.
The energy ministers “agreed on the continuation of the constructive process followed for the Aphrodite and Yishai deposits issue for a fair and speedy resolution”, said a commerce ministry statement.
It added: “Working groups have made progress on key aspects and developed a road map for future negotiations.
“Both sides expressed optimism about the chances of a settlement and encouraged the companies involved to continue their dialogue.”
The Cypriot Aphrodite field and Israel’s Yishai gas field expand across the maritime territory claimed by both countries.
Aphrodite – licensed to US firm Chevron, Britain’s Shell, and Israeli partners — was discovered in 2011 and is estimated to hold around 4.5 trillion cubic feet of natural gas.
A small portion of the field extends into the Yishai license in the Israeli exclusive economic zone, an obstacle complicating the gas field’s development.
Cyprus and Israel have held talks to reach a unitization agreement for over a decade but have yet to conclude a deal.
In March 2021, the Cypriot and Israeli energy ministers agreed to give the partners in Aphrodite and Yishai a year to conduct direct negotiations or to refer the matter to an international expert, if needed, before the governments step in again.
Over a year later, no agreement has been reached between the companies on both sides of the border.
“Cyprus and Israel share the common vision of fully exploiting the potential of the natural gas reserves of the Eastern Mediterranean, thus diversifying the sources and routes of energy to Europe,” said Pilides.
She said the two energy ministries have made “significant progress in the discussions leading to a mutually beneficial settlement”.
“These discussions will continue in a structured manner over the coming weeks.”
Elharrar said due to the global energy crisis and Europe’s growing gas needs, “I believe it is in our best interest for both sides to expedite their work for a swift, transparent and fair settlement”.
“The trust between us and the continuation of our fruitful cooperation in the various fields is very important for both parties.”
Israel and Cyprus signed an agreement to set the border between their exclusive economic waters in 2010.
But an agreement was never signed to arrange the commercial development of gas reservoirs straddling both countries’ territories.
It is estimated the Israeli side of Aphrodite-Yishai has 10 billion to 12 billion cubic meters of natural gas, less than the Leviathan gas field, which has an estimated 605 bcm.
The partners exploiting Cyprus’ Aphrodite gas have approved a $192 million investment to begin drilling and cover other development costs for the offshore project, Israeli firm NewMed Energy said.
Most of the investment is for drilling a well that will confirm the size of the gas deposit, estimated to be 124 billion cubic metres, and then be used for production, NewMed said.
Drilling is expected to begin in the first half of 2023.