The project, known as East Med, involves a 2,000 km long pipeline to channel offshore reserves in the Levantine Basin in the far east corner of the Mediterranean to Greece and Italy, at a cost of up to €6b.

The eastern Mediterranean has produced some of the world’s biggest gas finds in the past decade, and much of it is still thought to be untapped at a time Europe is looking to diversify its gas resources for reasons of energy security.

“Today we have concluded a very significant milestone, which is the signing of a memorandum of understanding which outlines the political commitment of the four countries to pursue this project,” Cypriot Energy Minister Yiorgos Lakkotrypis said during a signing ceremony in Nicosia with counterpart from Greece, Giorgos Stathakis, Israel, Yuval Steinitz and by the Ambassador of Italy in Cyprus, Andrea Cavallari. The Italian energy minister did not attend due to a technical problem with regard to his flight to the island.

The pipeline, Lakkotrypis said, was a “very important pillar” in the eastern Mediterranean natural gas corridor.

The four countries also said they would cooperate to facilitate studies, permits, construction and operation of the project, with a view to signing an Intergovernmental Agreement on the project “within 2018”, a joint statement said.

Israel has discovered more than 900 billion cubic metres (bcm) of gas offshore. Cyprus’ Aphrodite gas field holds an additional 128 bcm and Cypriot waters are expected to hold more reserves.

It is estimated the pipeline could transport up to 16 bcm of gas per year. The project owners are IGI Poseidon, a joint venture between Greece’s natural gas firm DEPA and Italian energy group Edison.

A joint statement after Tuesday’s signing said the MoU and the quadrilateral discussions held today, “confirmed our intention to cooperate in enabling and enhancing the development and the implementation of the EastMed Pipeline Project, as a viable and strategic option and an infrastructure of special interest for gas producing States and the EU”.

It added that the project would secure a direct long-term export route from Israel and Cyprus to Greece, Italy and other European markets as an additional element of the Eastern Mediterranean Corridor, thereby strengthening EU’s security of supply, while promoting competition among gas suppliers.

“We also expressed our willingness to cooperate in order to facilitate the necessary studies, the permitting, the construction and the operation of the project,” the joint statement said.

In this respect, the Working Group consisting of the Directors General of our the respective energy ministries, established by the Ministers at the Tel Aviv Ministerial Summit held on 3 April 2017, would continue to hold meetings, with the mandate to discuss, inter alia, the provisions of an Intergovernmental Agreement (IGA) between Cyprus, Greece, Israel and Italy with the objective of signing the IGA within 2018.

The parties have set a target of 2025 for completion of the project.

It will be paid for at least in part with money from the EU under the Connecting European Facility programme.

The planned pipeline is to connect Israel’s Leviathan gas field and via Cyprus’ Aphrodite gas field, Crete, mainland Greece and Italy. The initial estimate of the cost of the pipeline, which will be able to convey 12-16 billion cubic metres (BCM) of gas annually, is $5.7 billion.

Source: Cyprus Mail