“We believe there isstill a good market in Egypt both for internal consumption and for exports and we are working hard to make it a success in terms of coming to agreements,” Gene Kornegay, country manager of Noble Energy International Cyprus, said on Tuesday.

“The markets available to us now are in Egypt,” he said, adding that the gas would be transported via pipeline.

“Some of the market in Egypt would actually use it for export again, but some may be consumed within the Egyptian domestic market,” he noted.

Speaking at the Economist’s 11th Cyprus Summit in Nicosia, the Noble official said reports that ENI’s Zohr find has ‘killed’ the market for imported gas in Egypt “have been greatly exaggerated”.

In late August, ENI announced the largest gas discovery ever made in the Mediterranean – the Zohr field holding an estimated 30 trillion cubic feet of gas – leaving competitors chaffing.

Kornegay said Noble is currently engaged in two main activities.

“We are in the process of finalising our development plan that is an activity we are engaged with the government of Cyprus. It’s a collaborative process and we hope that it will be complete in the next few months.”

At the same time, he added, Noble is “busy marketing the gas”.

According to Kornegay, the Cyprus market is relatively small and insufficient to support the development of the Aphrodite field, although some of the gas would be channelled to the island for domestic consumption.

The markets available to Noble now are in Egypt, he said, adding that the gas would be transported via pipeline.

“We believe there is still a good market in Egypt both for internal consumption and for exports and we are working hard to make it a success in terms of coming to agreements,” he stressed.

Local media meanwhile suggest that the government is poised to open up a third licensing round for Cyprus’ offshore blocks.

Citing reliable sources, daily Simerini said the new round could be launched sometime in December.

It said the Zohr discovery has re-ignited interest in the eastern Med, with the energy ministry here being inundated with calls and emails from foreign energy companies.

The Zohr prospect lies just 6km from the boundaries of Cyprus’ Block 11, licensed to French oil major Total, and about 90km from the ‘Aphrodite’ reservoir in Block 12.

As such, companies have been expressing renewed interest in both these blocks. Per the contracts between the government and the companies (Total, Noble), part of the acreage in these blocks has been ‘returned’ to the Republic of Cyprus and is thus available for new bids.

Earlier this year, Total relinquished Block 10 without drilling any wells. The company was released from its original two-well drilling commitment – across two adjacent blocks, 10 and 11, lying on the maritime border with Egypt – but maintained exploration rights in Block 11, agreeing to continue to evaluate 3D seismic data in a bid to locate a possible target.

Total’s exploration licence in Block 11 expires in February 2016.

But according to Simerini, the company is now keen on negotiating a new contract, which could provide for drilling up to four exploratory wells.

Unlicensed offshore Blocks 6 and 7, located just north of Blocks 10 and 11, respectively, may also come into play.

This is not so much because of their proximity to the Zohr field, but rather due to their geological attributes.

In discovering Zohr, ENI took a gamble that paid off immensely. Instead of using the traditional geological sequencing model tracking sand reservoirs, the company deployed a model searching for carbonate reservoirs.

In Cyprus, following two unsuccessful exploration drills in Block 9, ENI had been reportedly considering abandoning its operations here.

Now, however, ENI is said to be applying the carbonate model to re-evaluate its acreage in Blocks 2, 3 and 9, over which it has licences.

And other companies think they can likewise use a carbonate-based model to find reservoirs that may have previously eluded them in Cyprus’ Exclusive Economic Zone.

The government must weigh the pros and cons of initiating a new licensing round. On the one hand, Cyprus should strike while the iron is hot, as it were. On the other, the Anastasiades’ administration is aware that a new round could throw a spanner in the works while reunification talks are ongoing.

Source: Cyprus Mail