articles | 20 June 2014

China Oil in talks to acquire shares in Aphrodite field

Energy giant China National Offshore Oil Corp. (CNOOC) is reportedly in talks to buy 30 to 40% of the Aphrodite gas field in Cyprus’ offshore Block 12.

According to Israeli business news site Globes, CNOOC is interested in Block 12 as the estimated reserves there – around 4 trillion cubic feet – are ideally suited for a Floating Liquid Natural Gas (FLNG) solution. That would allow the Chinese outfit to export gas to Chinese companies, Globes writes.

Government officials here could not be reached for comment, but late Thursday the government spokesman, on a live show broadcast by CyBC, confirmed the Chinese company’s interest in Block 12.

Noble Energy owns 70% of the rights of the Aphrodite field, and Delek Group energy exploration units Avner Oil and Delek Drilling Limited Partnership own 15% each.

Globes also recently reported that Australia’s Woodside, specialising in floating technology solutions, was sounding out Noble for a possible partnership in Block 12.

Noble has long been seeking a strategic partner in the concession. According to gas expert Charles Ellinas, in April of last year Noble, having opened its so-called ‘data room’ – access to information relating to the Aphrodite gas prospect – received interest from several companies and/or consortia, after which it shortlisted five companies as possible partners, including ENI and Total, and possibly CNOOC.

Ellinas said that, under its business principle, Noble tends to keep around 40% of the working interest in concessions, thus spreading the risk.

This is standard practice in the industry.

CNOOC has on several occasions been mentioned in the media as being interested in the Cypriot offshore prospects.

Globes reported that CNOOC had in the past also expressed an interest in buying into Israel’s Leviathan gas field, but Noble had opted to begin negotiations with Woodside instead.

Woodside had planned to buy 25% of Leviathan for $2.71 billion but withdrew due to disagreements over export priorities following Noble, Delek and Ratio’s preference for a regional pipeline rather than an FLNG for exports to East Asia.

Source: Cyprus Mail

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