Cyprus Gas Field Development Gets $4 Billion Price Tag

The consortium developing the Aphrodite gas field offshore Cyprus has submitted a development plan to the country’s government putting the price tag for the field at $4 billion, Reuters has reported, citing one of the partners.

“According to the updated plan, the production and processing of natural gas from the reservoir will be carried out through the construction of an independent floating production facility to be positioned above the Aphrodite reservoir,” Israeli NewMed Energy said.

NewMed Energy partners with Chevron and Shell for the development of the Aphrodite field, which is seen producing some 800 million cu ft of natural gas per day at peak capacity. The gas extracted from the field would be sent to Egypt. There are also plans to turn some of the gas into LNG and export it globally, according to NewMed Energy’s website.

The biggest potential buyers for Cypriot gas are Europeans. The opportunity made headlines two years ago amid the European gas crunch when Chevron, Shell, and NewMed Energy were drilling exploration wells at Aphrodite.

“Europe is a good potential customer for Cypriot gas as the EU has confirmed that natural gas will remain a bridge fuel up to 2049 as part of the green transition so companies now have the comfort of being able to secure long-term contracts,” Cyprus’ energy minister Natasa Pilides told Bloomberg at the time.

Yet the development of the Aphrodite field was delayed due to negotiations on changes in the production sharing scheme between the three partners and the Cypriot government following Chevron’s acquisition of the original holder of the exploration license, Noble Energy.

Now these seem to have been settled and development could move forward. The same may be true of other gas discoveries offshore Cyprus, such as the Glaucus field, discovered by Exxon and Qatar Petroleum, and the Calypso field, a project of Eni and TotalEnergies.

By Charles Kennedy for Oilprice.com

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