Initial results from studies conducted to find out whether a newly discovered massive offshore gas field located in the eastern Mediterranean extends to the island of Cyprus have dampened hopes.
Although research is ongoing, the findings of French oil and gas consulting and software solutions provider Beicip-Franlab have determined the the giant Zohr offshore gas field recently found in Egypt’s Nile Delta does not extend into Cyprus’s exclusive economic zone (EEZ).
However, seismographic data suggests that the gas field does indeed extend towards and may in fact slightly stretch into Block 11 in the island’s EEZ, which is currently being leased to French energy firm Total, but the “thickness” of the reservoir decreases significantly, findings suggested.
Greek Cypriot Energy Minister Yiorgos Lakkotrypis earlier this week said that his administration is investigating if the Zohr gas field extends to the island’s waters.
The discovery of the 100 square kilometre Zohr gas field in the Shorouk Block, just six kilometres from Block 11, by Italian energy firm Eni was declared late in August. It is the largest known gas field in the Mediterranean to date, holding an estimated 30 trillion cubic feet of gas.
Eni signed an energy exploration deal with Egypt worth $2 billion last June, allowing the Italian giant to explore in Sinai, the Gulf of Suez, the Mediterranean and areas in the Nile Delta.
Egypt, which was traditionally an exporter of natural gas, has been experiencing an energy crisis since 2011 due to increasing consumption and declining production, and has thus turned into a net importer.
In a bid to revive the country’s gas production, Egypt under President Abdel-Fattah el Sisi secured $36.2 billion in investment deals, after a three-day conference held in the Red Sea resort town of Sharm el Sheikh in March.
During the conference, Eni signed an agreement worth $5 billion over 4-5 years for concessions in the Mediterranean, the Western Desert, the Nile Delta and Sinai. The deals also include a record investment by British Petroleum and its Russian partner DEA of $12 billion in Egyptian gas fields that will produce 3 billion barrels of oil.
Initial data from the Zohr gas field, however, could change as it is still being collected. Eni is due to start drilling the well in January 2016.
Lakkotrypis, who on Tuesday said the results from ongoing research will be announced in the “coming days,” is due to be briefed on developments next week.
The discovery of the reserves in the region has also raised hopes in Europe of an alternative gas source, as the continent continues its efforts to diversify its supply away from Russian gas.
Greek Cypriot Energy Minister Giorgos Lakkotrypis told the Turkish daily Milliyet newspaper in a report published in May that natural gas could go to the European market through Turkey, if there is a solution to the island’s 41-year dispute with the Turkish Cypriots.
Experts have also suggested combining the reserves in the region to economically justify the construction of a liquefied natural gas (LNG) plant, which would export LNG to the European market.
After a meeting with Greek Cypriot leader Nicos Anastasiades last week, Eni CEO Claudio Descalzi suggested that gas from reserves off Cyprus could be processed at the company facility in Egypt’s Damietta to export it to Europe.
In April, Eni and South Korean energy firm withdrew an exploration vessel from the island’s Block 9 after research yielded disappointing results in the block’s Onasagoras and Amathousa fields.
Speaking to reporters after his meeting with the Greek Cypriot leader, however, Eni chief Descalzi said, “we are reassessing our geological model but is clear that our commitment to continue exploration in Cyprus is very strong.”