Solon Kassinis, head of the Commerce Ministry’s Energy Department, was referring to Israel’s discovery of large amounts of hydrocarbons in its territorial waters this week.
A US-Israeli exploration group led by Noble Energy said on Sunday it had found more than 88 billion cubic meters of natural gas 90 kilometres from the port of Haifa in northern Israel.
According to Reuters, the group plans to carry out production tests and additional verification drills in the next few months before making a final decision on whether to go ahead with an investment expected to reach $1.5 to $2 billion. The natural gas is estimated to be worth a total of $15- billion to $16 billion over a 15-year period starting in 2013.
The Israeli site is close to one of the exploration blocks earmarked for possible drilling by the Cyprus government and known as ‘Block 12.’ The government is said to have reached a preliminary deal with Noble Energy on this block, which appears to be the most promising.
Noble Energy is an independent energy company engaged in the exploration, development, production and marketing of crude oil and natural gas. It has operations in the Gulf of Mexico, West Africa, the North Sea and Israel.
Nicosia and Tel Aviv now need to thrash out an agreement fixing their respective Exclusive Economic Zones (EEZ) so there is no overlap.
Kassinis said the government was preparing for talks with Israel. A high-level visit to the neighboring country was on the cards.
He foresaw no major obstacles in concluding an agreement.
“I don’t think there will be problems…although there are some vague points to be clarified,” he told newsmen, without elaborating.
Kassinis gave a ballpark figure of three to five years when asked one might expect actual drilling to commence in Cypriot waters.
“But no sooner than that,” he added.
He also denied press reports that some oil corporations had lost interest in the other blocks and jumped ship because the blocks did not appear to contain enough natural gas to make drilling profitable.
But Kassinis said no company had bailed out; rather, he said, the government had decided that these corporations did not meet the criteria spelled out in the bids.
Dominic Farrell
