Final decisions on developing the Aphrodite gas field will be made on November 20, NewMed Energy said in a statement to the Tel Aviv Stock Exchange.
It said the consortium partners will consider their possible courses of action on the dispute.
The operator of the field, US energy giant Chevron, received on November 5 a letter from the Cypriot Ministry of Energy granting an extension to the consortium partners to comply with the approved development plan.
“The date of the final and binding decision of the Cypriot government regarding the Partners’ request shall be postponed to November 20 2023, and the date for compliance with the milestone will be postponed by a period of two months (i.e., until January 7 2024), provided that the Partners confirm their consent to the aforesaid (development plan) and sign an amendment to the Production Sharing Contract,” said the letter.
Under the Production Sharing Contract, which was agreed in 2019, the milestone for commencing the techno-economic study (Front-End Engineering and Design) for the field’s development was November 7, 2023.
However, the company submitted an amended development plan in May, which the Republic of Cyprus rejected in August.
Two extensions to the consultation process were subsequently granted with a deadline of November 5, while the consortium requested a four-month extension to the whole process.
“The Partners in the Aphrodite Field intend to examine the significance of the Cypriot government’s letter and the possible courses of action available to them,” NewMed Energy said.
The joint venture consists of Chevron Cyprus (operator) and BG Cyprus (Shell) with 35% and Israel’s NewMed with 30%.
Talks to bridge a rift over pared-back plans for the estimated 3.5 trillion cubic feet (tcf) field southeast of Cyprus went down to the wire. Cypriot authorities agreed to Chevron’s extension request when negotiations were due to expire.
Development of the field had been the subject of a dispute after the consortium submitted a modified plan this year, which Cyprus said reneged on a 2019 field development plan agreed by all sides.
The initial plan submitted by Noble Energy included the construction of a Floating Production Unit (FPU) for natural gas production.
Cyprus’ objections to the consortium’s new plans stem from the argument that the FPU would allow for increased gas recovery, consequently maximising revenues.