Gas riches off Cyprus lower than expected

October 04, 2013 - 5:33:58 am

NICOSIA: Gas reserves off Cyprus are nearly a third less than initially estimated but remain “substantial,”  the country’s energy minister said yesterday, insisting it would proceed with ambitious production plans.

Energy Minister George Lakkotrypis said test data from a confirmation drill by US firm Noble Energy showed the natural gas discovery in Block 12 ranges from 3.6 trillion cubic feet to 6 tcf with a mean of 5 tcf, falling short of a Noble estimate in 2011 of 5-8 tcf, with a mean of 7 tcf.

Lakkotrypis insisted, however, that the assessment “confirms there are substantial deposits of natural gas with significant possibilities of production.”

“Every half a trillion cubic feet of natural gas represents 25 years of power supply for the Cyprus electricity authority,” he said.

He said the results would not deter the government from going ahead with the building of a liquified natural gas plant for its offshore gas, as there are other blocks to be exploited. A second appraisal well will meanwhile be required to specify the quantity in Block 12. US firm Noble Energy began confirmation drilling off the southern shore of Cyprus in June to ascertain whether there is enough untapped gas to make the LNG venture commercially viable.

Cyprus has signed a memorandum of understanding with a US-Israeli partnership to build the LNG plant to exploit untapped energy wealth. Israeli firms Delek Drilling and Avner Oil Exploration each own 15 percent of the US project. The almost bankrupt Mediterranean island is hoping its untapped offshore energy resources can pull it back from the financial brink after a banking meltdown earlier this year that prompted an EU-IMF bailout.