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The Future for Oil & Gas in Cyprus

  • Publish Date: Posted 18 November 2013
  • Author: Gina Le Prevost

​The Island of Aphrodite

An island situated in the Eastern Mediterranean and a crossroad point of three major continents Europe, Asia and Africa, Cyprus is the third largest Island in Europe with an area of 9251. Sq km and a population of approximately 840,000. A popular tourist destination, Cyprus enjoys a sub-tropical climate, with long summers and very mild winters. Cyprus has been a member state of the European Union since May 2004 and is a former British Colony. Cyprus has an adaptable and free market economy with its main economic activities being; Banking, Forex and Trading, Tourism, Marine & Shipping, Property and most recently Energy.

The key cities in Cyprus are Nicosia, the capital of the Island, Limassol, Larnaca and Paphos.

Nicosia is the financial and corporate heart of Cyprus and home to international banks, professional services organisations, law firms and most recently oil and gas operators and contractors. Nicosia is an elegant and modern city that is rich in history, yet boasting the latest fashion trends with a truly European cafe culture.

Limassol always has been the shipping and marine hub of the Island, with the port of Limassol being one of the busiest in the Mediterranean. The city blends cosmopolitan shops, history, high profile international organisations, all set against the beauty of the Mediterranean coast.

Larnaca is home to the island's second largest commercial port and Larnaca International Airport, making it an important part of Cyprus, it is the island's third largest City. It boasts beaches, historical features, architecture and culture.

Paphos is home of the legendary birth place of the Goddess Aphrodite. Rich in history Paphos is listed in UNESCO's list of world heritage sites. Luxury, tradition, beauty, history and culture is why Paphos is the gem of Western Cyprus.

The journey so far

After three years of exploration activity, in 2011, Noble Energy, a leading US based energy organisation, announced to the world that a natural gas field discovery had been made offshore of Cyprus. Today Noble Energy, Delek, Avner Oil, Total and Eni-Kogas are the energy companies at the forefront of the hydrocarbon activities in Cyprus and the Eastern Mediterranean.

With substantial oil and gas resources in the region, a notable part falls within the Cyprus Exclusive Economic Zone. At present 13 exploration blocks have been set out by the Republic of Cyprus, south of the island. There are still undiscovered hydrocarbon resources, it is believed, at the western part of Cyprus.

The first licensing round ended in 2007 with Noble Energy being awarded the first exploration licence and in 2011 they announced a natural gas field discovery offshore of Cyprus. The second licensing round commenced in 2012, where companies from 15 countries submitted their bids for the 12 blocks in the Cyprus Exclusive Economic Zone. In 2013, Cyprus awarded exploration licences for blocks 2, 3 and 9 to Eni-Kogas and received €150m in contractual bonuses.

Total, one of the "super major" oil and gas corporations globally, were then granted licences for the exploration of blocks 10 and 11 in February 2013, which saw the Republic of Cyprus receive a contractual bonus of €24m.

This year we have seen 30% of Noble Energy's exploration rights in block 12 transferred to drilling partners Delek and Avner Oil. The Italian-Korean consortium Eni-KOGAS and the Cypriot government will start bidding talks for offshore blocks 5 and 6 with the view to the consortium being awarded exploration concessions.

So far, to date, Noble Energy estimates gross resources of the natural gas field in the range of 3.6 Tcf of natural gas to 6Tcf with a median of 5Tcf.

The future

It is without a doubt, that there are significant oil and gas resources in the Eastern Mediterranean, including the Cyprus Exclusive Economic Zone, both discovered and undiscovered. How Cyprus embraces this unique opportunity it is presented with is crucial. The signs are very positive from both the government of The Republic of Cyprus and the energy companies involved. There appears to be a cohesive understanding that time is of the essence. The importance of the development and growth of the emerging energy sector in Cyprus cannot be underestimated as it will act to strengthen and diversify the Cypriot economy.

We have seen Energy ministers for Cyprus and Lebanon come together to discuss future hydrocarbon activities with the view to negotiating a production sharing agreement. Cyprus has already signed agreements with Israel, Egypt and Palestine, setting out future activities and border agreements. Most recently we see the Energy Minister for the Republic of Cyprus announcing the possibility of a temporary casino being built in the integrated resort and being awarded to the winning energy company of a future license. This provides a more immediate income for the country whilst making bidding for the exploration licenses more enticing to the energy company.

All of this activity shows the commitment, focus and determination of The Republic of Cyprus to ensure that the country reaps the full rewards and benefits of this rising and promising new sector. The future for Cyprus and its people is bright and also offers hope and inspiration to young Cypriots for diverse future career prospects.

AP Global Energy

AP Global Energy is firmly part of this new and emerging chapter in Cyprus. AP Global Energy is part of the AP Group, which was formed in 1990 and is a leading global group of offshore recruitment consultancies, with offices in Nicosia, Limassol, London, Geneva, Zurich, Vietnam, Guernsey and Jersey, which operate internationally in over 55 jurisdictions.

AP Global Energy is a dedicated Oil & Energy consultancy specialising in the recruitment of high quality Oil and Energy professionals for our client's contract and permanent requirements covering the E&P, Transportation & Storage and Refinery sectors. AP Global Energy provides recruitment solutions covering; Petrochemical, LNG, Subsea, Offshore, Onshore, Geotechnical, Environmental and Renewable Energy sectors.

Our specialist areas of recruitment include;

  • PROJECT MANAGERS 

  • PROJECT ENGINEERS

  • DESIGN & CAD

  • MECHANICAL & PIPING

  • ELECTRICAL

  • INSTRUMENTATION & CONTROLS  

  • DRILLING

  • TECHNICIANS & MAINTENANCE

  • PROCESS & CHEMICAL

  • STRUCTURAL & CIVIL

  • HSE & QUALITY

  • ENVIRONMENTAL & GEOTECHNICAL

  • HUMAN RESOURCES AND TRAINING

  • MANAGEMENT & EXECUTIVE

  • TECHNICAL ADMINISTRATION & BUSINESS SUPPORT

  • FINANCE

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