Greek Cyprus OKs plans for US-Israeli LNG plant

Greek Cyprus OKs plans for US-Israeli LNG plant

NICOSIA - Agence France-Presse
Greek Cyprus OKs plans for US-Israeli LNG plant

A liqudified natural gas (LNG) plant is seen in this photo. The Greek Cypriot cabinet has approved plans for a LNG plant deal with US-Israeli partnership. REUTERS photo

The Greek Cypriot cabinet approved plans to sign for a deal with a US-Israeli partnership to build a liquefied natural gas plant on the island to exploit untapped energy riches, ignoring Turkey’s objections to its oil and gas explorations that cites the recources should be divided between two sides of the separated island.

“The cabinet has approved the decision to sign the memorandum of understanding between Cyprus and companies Noble Energy International (US), Delek Drilling and Avner Oil Exploration Limited Partnership for liquefaction terminal for natural gas,” said government spokesman Victor Papadopoulos on June 19.

Earlier this month, Noble started confirmation drilling off the southern coast to ascertain whether there is enough untapped gas to make the venture commercially viable.

Based on initial test drilling in 2011, the estimated amount of gas in Block 12 is 5-8 trillion cubic feet (142 billion-227 billion cubic metres), with a mean of seven trillion cubic feet, the Houston-based company said.

Noble owns 70 percent of the drilling project, with Israeli partners Delek and Avner each holding 15 percent.

Tension over resources

The almost bankrupt Mediterranean island is hoping its untapped offshore energy resources can pull it back from the financial brink. It hopes to commercially export its gas, and maybe oil riches, by 2020.
However, Turkey has been slamming the Greek Cypriot government claiming it violates rights of the Turkish residents of the island.

As the latest expression of the concerens over the issue the Turkish Foreign ministry said in a statement that Ankara “won’t let the Cypriot issue continue in this way.”

It also restated that Turkey is ready for negotiations that can be held over the possibility of starting a two-state solution for the island.

Turkish energy authorities have been saying the best way for carrying any Mediterranean source – Cypriot or Israeli gas and oil –, Turkey will be the best route and any scheme in which Turkey is excluded won’t be reasonable.

The eastern Mediterranean has been a hive of exploratory activity, with the Greek Cypriot government granting permits to international prospectors after Israel discovered massive offshore gas deposits in 2010.

Noble made the first find off Cyprus’s southeast coast in 2011 near the Israeli maritime boundary, in a test well named Aphrodite-1 after the island’s mythological goddess of love.

The government has played up the potential of the gas windfall estimating it at 60 trillion cubic feet, but this figure has yet to be verified through exploration. Earlier this year, Greek Cyprus signed additional agreements with French energy giant Total and a partnership of ENI of Italy and South Korea’s Kogas for oil and gas exploration in its waters.