Moves on Aphrodite development plan

Israel’s NewMed Energy, one of the partners in the Chevron-operated Aphrodite gas field in Cyprus, announced in its Q1 2022 financial report released on May 23 that talks are underway with the Cypriot government to update the gas field’s development plan.

As in its latest reports, the company restated that the partners are examining whether to connect Aphrodite to existing facilities in the region (i.e. LNG plants in Egypt) and/or to the development plans of nearby assets (i.e. the Leviathan gas field in Israel’s EEZ), suggesting that no decision has been made yet.

But the company also announced that a decision was made “regarding engagement with a drillship” to drill a well in Aphrodite (dubbed A-3), which will serve as a production well at a later stage.

However, it did not disclose details of the timeline.

In its 2021 annual report released in March, NewMed said that the government of Cyprus approved its request to postpone the drilling of the A-3 “appraisal/development well”, which was supposed to be carried out by November 2021 for 12 months, i.e., until November 2022.

Aphrodite was discovered in 2011 and is estimated to hold around 4 tcf of natural gas.

A small portion of the field extends into the Yishai license in the Israeli EEZ, one of the various obstacles that have complicated the development of the gas field.

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, to reach an agreement on profit distribution, before the governments of the two countries step in again.

A year later, no agreement has been reached between the companies on both sides of the border.

Middle East Strategic Perspectives publish the East Med Energy Report in collaboration with Obeid & Medawar Law Firm