LNG plant in South not viable without Israeli gas

Following a meeting today with President Anastasiades, Noble Energy’s Senior Vice Chairman, Eastern Mediterranean, Keith Elliott issued the following statement:

“We gave an update [to the president] on the activities that have been going on in bloc 12 since the drilling of the appraisal well. I put forward plans and so we continue to work our exploration processes and look at further opportunities, we continue to evaluate the results of the A2 well and look at further opportunities for further appraisal activities and working through the process of fully evaluating the block, this is our priority”.

Elliot said that Noble is evaluating the prospect of finding oil in bloc 12, currently the emphasis is on finding gas and that they did not know which would prevail.

When asked about progress on Noble’s plans to be involved in the potential construction of an LNG in the South, Elliot said that there was progress and the Noble continued to work closely with the energy minister and the government’s teams towards creating a framework agreement for the project, at the same time supporting the government’s planning process.

He was also asked if he thought the reserves in Aphrodite field were sufficient to justify the expense of an LNG plant. In response he replied that it would probably take need more gas and thus Noble was looking at sourcing from other co-ventures such as Israeli reserves in the region offshore Cyprus.

Last month director of Cyprus’ national gas company, Charles Ellinas said that it was essential that the South did everything possible to secure the use of Israeli gas at a planned LNG terminal on the island, or else risk jeopardising the whole project.

Ellinas argued that the estimated 5 trillion cubic feet (tcf) sitting in Noble Energy’s Aphrodite field in its Bloc 12 concession in Cyprus (EEZ) was simply not enough to justify the construction of a costly liquefaction plant at Vassilikos.

The estimated cost of building the LNG plant is around 6.5 billion euros.

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