Cyprus announces tender for Natural Gas supply until September 2018

Cyprus Home — 29 September 2012

CYPRUS Natural Gas Public Company (DEFA) announced a call for the expression of interest for the supply of natural gas as an interim solution until the extraction and import of natural gas located in the block 12 of the Cypriot Exclusive Economic Zone expected by September 2018.

The tender covers two alternative forms of supply and namely the supply of Compressed Natural Gas (CNG) or the supply of Liquefied Natural Gas (LNG) via a Floating Storage and Regasification Unit (FSRU).

The gas will be delivered at Vasilikos power plant for electricity production purposes.

According to the tenders provisions, “of paramount importance for the selection of the successful party is the earliest possible delivery of the gas and the gas price.

Detailed selection criteria will be communicated to the selected parties before the commencement of the negotiating process.”

Based on current estimates, DEFA expects that the demand for natural gas in the period to 30 September 2018 for use at Cypriot Power stations will be either 0.4, 1 or 1.2 billion cubic meters per annum.

The tenders closing date is October 29.

According to the tenders timetable, the negotiations with the successful party are expected to be completed in 13 weeks from today, whereas the natural gas supply is expected to commence “at the earliest feasible date and not later than early 2015″.
Exploratory drilling conducted by Huston-based Noble Energy in Block 12 of Cyprus Exclusive Economic Zone, revealed a gross natural gas reserve between 3 to 9 trillion cubic feet (tcf) with a 60 percent probability of geologic success.

The government approved on November 23, last year, the launch of a second licensing round for the remaining 12 offshore blocks, a decision published in the EU Official Journal on February 11, 2012 and expired on May 11, after a three-month bidding period.

Fifteen companies and joint ventures, including energy heavyweights such as French Total and Korean KOGAS, have bided for 9 out of Cyprus 12 offshore exploration blocks. Bids are being currently evaluated by the government.