Victoras Papadopoulos didn’t disclose Wednesday details of the deal. Cyprus is looking to have the estimated 10 billion euro ($13.41 billion) facility up by 2020 to process offshore gas reserves for domestic use and export. The bailed-out country hopes the project will boost its struggling economy.

Noble, Delek and its subsidiary Avner are partners in a gas field off Cyprus’ southern coast that’s estimated to contain 5-8 trillion cubic feet of gas.

Cyprus has also licensed Italy’s ENI, France’s Total and South Korea’s Kogas to search for offshore gas.\

Published by: www.startribune.com

Nicosia, Jun 7 (CNA) – Noble Energy International has announced that the Ensco 5006 has commenced drilling at the A-2 appraisal well location in block 12.

“It is estimated that drilling the well will take approximately three months to reach a total depth of about 5,600 meters below sea level”,  a Noble press release, issued here, on Friday, says, adding that water depth at the well is about 1,700 meters.

The press release also notes that “the drilling results from the A-2 well will help Noble Energy confirm the estimated resource size and provide information required to initiate planning of subsequent stages of development”.

Published by: www.cna.org.cy

The U.S. company, which reported a natural gas discovery of 5-8 trillion cubic feet southeast of the island in 2011, is conducting the appraisal to quantify and confirm the earlier find.

“The process is expected to last three to four months,” Cyprus Energy Minister George Lakkotrypis said.

Cyprus, which received an international financial bailout earlier this year, is keen to develop untapped offshore gas reserves to power future economic growth.

Noble has rights over one offshore block south of Cyprus. France’s Total and Italy’s ENI, which have rights over other blocks, plan to drill for hydrocarbons by 2015.

The ENSCO 5006 drilling rig used by Noble was moved into position on June 1 and the well will be 5,607 metres deep, officials said.

Neighbouring Israel has reported significant natural gas finds, with two of its fields the largest discovered worldwide in the past decade. Lebanon, which also neighbors Cyprus, may have at least 30 trillion cubic feet in its waters, its energy minister said on May 31..

Published by: www.reuters.com

Energy and trade minister Giorgos Lakkotrypis was commenting on an announcement posted on Sunday by Delek Drilling and Avner – subsidiaries of Israel’s Delek Group – saying the companies had approved a decision to drill at the Aphrodite 2 well in the Block 12 prospect.

The announcement said Noble Energy, the prospect’s operator, had recommended to its Aphrodite partners to green-light the appraisal well at Aphrodite 2 as part of the work plan approved by the Cyprus government under the production-sharing contract.

A budget of €US117m (€90m) has been approved for the drilling operations.

“It is noted that this drilling may be used as a production well in the future,” the announcement said, adding that drilling was expected to start “in the coming two weeks and last for approximately four months.”

Confirming the news, the energy minister told the state broadcaster that drilling is expected to be wrapped up by October.

Appraisal, or follow-up, drilling is done to confirm estimated reserves and determine the quality of hydrocarbons within a prospect.

In late 2011, following exploratory drilling at Aphrodite 1, Noble announced the discovery of a gross mean of 7 trillion cubic feet of natural gas.

Should the estimates be borne out,  the energy minister said, that would allow authorities to proceed with more detailed planning on monetising the gas.

The government plans to build a liquefied natural gas (LNG) plant at Vassilikos, Limassol, for the processing, domestic distribution and export of offshore natural gas.

Confirmation of the gas estimates at Aphrodite would allow Cyprus to start sounding out long-term buyers for the gas, also paving the way to seeking financing for the LNG terminal.

The government wants to sign a memorandum of understanding with Noble for developing the LNG facility. The deal’s purpose is to set up a joint venture between the Cyprus National Hydrocarbons Company and Noble, a special purpose vehicle to seek out investors for the plant.

The intended deal relates to the construction of a single train at Vassilikos. More trains could subsequently be added to the facility in the event of further gas discoveries in Cypriot waters.

The Mail has confirmed that drilling at the Aphrodite well will be carried out by the ENSCO 5006 semi-submersible platform, currently on lease by Noble. The rig is being moved to Cypriot waters after prospecting in Israel’s Karish prospect.

Meanwhile preparatory work is underway at the shore base operated by EDT Offshore, an oil and gas services company. The base, located at the port of Limassol, will provide support to Noble, including a fully operational mud-plant for drill stem testing.

EDT also operates a heliport providing support to drilling platforms.

Cyprus, heavily reliant on expensive heavy fuel oil for its energy needs, is meantime exploring the possibility of importing natural gas on an interim basis to power its electric plants.

The Natural Gas Public Company (DEFA) is currently in the stage of evaluating three proposals.

DEFA would be opening the bidders’ financial tenders later this week or early next week, according to the energy minister.

Officials have stressed they are not bound to conclude a deal if the cost of electricity production from natural gas is not substantially lower than current costs using heavy fuel oil.

Published by: www.cyprus-mail.com

Published by: www.incyprus.com.cy

During an interview, on the sidelines of the 2013 Offshore Technology Conference, in Houston, Texas, Elliot said he was satisfied with the working relationship established with the Cyprus government, adding that he did not believe things were progressing too slowly. Elliott has recently (last April) assumed his new duties, following an overhaul in Noble’s organisational structure, that added three major operating regions, including the Eastern Mediterranean.

Elliott said that as soon as the exploration well in Israel’s “Karish” field is finished, Noble will move the rig directly to Cyprus’ block 12 for the appraisal well. He added that the well in Israel is expected to finish in the first half of June, while drilling in block 12 will take up to three months. He noted that a lot depends on that operation, since “the purpose of the appraisal well is to try to narrow that bandwidth of uncertainty” with regards to the reservoir models and interpretations.

Elliott did not exclude another appraisal drilling in block 12, saying that “for a resource of this size and scale, two would be a very optimistic number”. He cited the example of Israel’s “Tamar” field, where Noble drilled two appraisal wells. “I wouldn’t want to leave anyone with the impression that this would be the last well”, he said, adding that if the company is able to build confidence in the resource base and size, this will result in fewer wells. Noble’s Vice President for the Eastern Mediterranean compared the company’s job to evaluate the resource through seismic data and drills, almost as “looking through an opaque screen”. “Our objective is to understand the resource,” he said, noting that this may take more wells. Cooperation with the government “fantastic”.

Published by: www.cna.org.cy

To remarks that the interim solution for importing natural gas seemed unprofitable and it would be better to bring natural gas directly from Cyprus` blocks, Lakkotrypis said decisions would be taken next week, after he briefs the President of the Republic on the situation.

Asked when a new Chairman of Cygas, Cyprus` natural gas public company, would be appointed, Lakkotrypis said this was a decision for the Council of Ministers, which would be convening again on May 8.

To questions when Cyprus would be able to exploit its own natural gas, the Minister noted that “for our own consumption we are waiting to see the results of the interim solution and at the same time we are looking at some other options we may have, but it is not time yet to announce anything.”

Asked when confirmatory drilling would take place in block 12, Lakkotrypis said “the rig will be moved to block 12 in June, mid or late June, confirmatory drilling will begin almost immediately, and we hope it will be concluded by October.”

He added that “when the confirmatory drilling is completed and we know the quantities, the quality and the recoverable quantities, the procedure must begin to declare the deposit marketable.”

Exploratory drilling conducted by Noble Energy in Block 12 of Cyprus’ exclusive economic zone has revealed a gross natural gas reserve from 3 to 9 trillion cubic feet with a 60% probability of geologic success.

Noble is expected to extract and transfer natural gas to Cyprus by late 2018.

Contracts have been signed with the ENI/KOGAS consortium in blocks 2, 3 and 9 within Cyprus’ exclusive economic zone and with Total for blocks 10 and 11 in the context of the second licensing round.

Published by: www.incyprus.com.cy

The head of the US company leading natural gas exploration offIsrael’s coast on Thursday urged the country to develop a national gas export policy, warning that government tax policy was scaring off potential investors.

Charles Davidson, CEO of Texas-based Noble Energy, criticized Israel’s decision in 2011 to nearly double tax rates on gas profits after his company had already invested $1 billion in an offshore field. He said the “very unusual” move may have driven away companies from investing in Israel’s emerging gas sector.

He said he sensed hesitation from potential investors who could help develop the Leviathan field, a large find that is expected to produce enough gas for export.

“I felt that … companies were a little bit reluctant because of what had happened on taxes in the past,” Davidson said at the company’s local offices in the coastal town of Herzliya.

In 2011, Israel’s government raised taxes on gas and oil finds, boosting the revenues to between 52% and 62% from under 30%.

Davidson is in Israel after gas from Tamar, one of Israel’s new, sizable fields, started being extracted last month. He hopes to convince authorities to agree on an export policy that would provide clarity for investors looking to develop the resource. For now, the gas is being used for domestic use only and sold at fixed, previously negotiated prices.

On Wednesday, Davidson met Prime Minister Benjamin Netanyahuand said he “encouraged” him to move on export. He said Netanyahu was receptive but gave no time frame.

The Tamar field was discovered in 2009 and holds an estimated 8.5 trillion cubic feet of gas. Leviathan, found in 2010, boasts an estimated 16 to 18 trillion cubic feet and is expected to go online in 2016. Around that time, Israel is expected to begin exporting.

Israel has yet to adopt an export policy for its natural gas reserves. A 2012 inter-ministerial report concluded that Israel should preserve enough natural gas for itself for 25 years, leaving about half of its estimated reserves for potential export. The discoveries are minimal compared to gas giants Russia, Qatar or Iran but the country’s proximity to Middle Eastern and European markets could make it an important regional player.

The consortium drilling off Israel’s coast has been pushing for Israel to adopt the recommendations. They say until there is a decision, they are not able to move forward on financing the field’s development, building infrastructure to transport the gas or securing global markets.

There have been calls from some in Israel to minimize gas available for exports in order to ensure domestic supply.

Published by: www.ynetnews.com

It was the first time the Houston-based company committed to anything close to a firm date for follow-up prospecting after initial drilling back in late 2011.

“Cyprus is very important to Noble Energy…we are committed to move forward with our Cyprus discovery,” the Noble boss said during a press briefing on the sidelines of the Eastern Mediterranean Gas Conference held in Nicosia.

In the eastern Mediterranean, Noble’s priorities in the region lie in Cyprus and the Tamar and Leviathan prospects in Israel, Davidson said, driving the point home.

The Noble boss, who earlier in the day held talks with President Nicos Anastasiades, said the company needed a commercial framework agreement with the government in order to press forward.

Globally, the US company plans to invest some $3.9bn (€3bn) in projects around the world this year.

Appraisal drilling at the Aphrodite well would likely start in June, as soon as the rig – currently deployed in Israel’s Karish field – is freed up, Davidson said.

Actual drilling may last anywhere from 75 to 90 days, after which it would take two to three more months to assess the data and come up with a more accurate assessment of how much gas the well holds.

“We’ll get a better handle on the extent of the reservoir,” Noble’s CEO said.

Initial drilling at the site determined the field has a gross mean average of 7 trillion cubic feet (tcf) of natural gas with an estimated gross resource range of 5 to 8 trillion.

In industry jargon, those figures were based on P75, or 75 per cent probability. Davidson explained that means there’s a 25 per cent chance of the gas being lower than 5 tfc, the lower end of the estimate, and a 25 per cent probability exceeding the higher end of 8 tcf.

Follow-up drilling will further narrow down the range, allowing Noble to figure out how to proceed next, said Davidson, adding: “In our business, 1 tcf makes a lot of difference.”

“The way I view LNG projects is, the bigger, the better…scale is your friend. It makes it that much easier to convince customers who’re interested in buying for 25 years.”

On monetising the Cyprus finds, Noble believes the best option is an LNG project. Unlike a pipeline, an LNG plant offers flexibility of markets.

“We need to be thinking globally,” as Davidson put it.

It would take four years to build the LNG facility for exports, he said, “but we can shave a year off that for domestic deliveries to the Cyprus market.”

“We need a strategic partner, as for example what we’ve done with Woodside in Israel, and we’re currently exploring that.”

Noble require a partner with experience in marketing the gas, and are waiting on the government to declare LNG as official policy.

Assuming the reserves are commercially viable, that would allow Noble to make a final investment decision. Under the terms of the production-sharing agreement with the government, Noble must declare commerciality within three months after the appraisal.

Davidson chose his words carefully when asked what would happen in the event of a Turkish-Israeli deal, given that the bulk of the gas Noble has discovered in the Eastern Mediterranean (30 out of 37 tcf) lies in Israeli waters. Quizzed on whether Noble might then give priority to the Israeli prospects, Davidson said the company’s projects in Cyprus and Israel were not in competition with one another.

“Obviously we will be working closely with the governments in each project…it’s a joint process,” he said.

Davidson offered a similar response when asked how Noble’s plans might be affected should the Israelis move to build their own LNG plant, but added: “We’re hoping for co-operation between the two countries.”

At any rate, Davidson said, Cyprus has a head-start on the LNG project, having already chosen the site for the plant.

Still, it’s understood that Noble regards the Aphrodite prospect as a worthwhile investment in its own right, provided the field holds as much gas as expected.

The Noble boss dismissed the notion that Noble was dragging its feet on Cyprus, noting that the exploratory drilling was carried out not long ago.

Davidson was flanked by many of Noble’s top brass: Terry Gerhart, Vice President – International for Noble Energy; Keith Elliott, Noble’s vice president of operations and engineering services, who will be taking over Gerhart’s position; John Tomic, operations director in Cyprus; and Barry Shelden, Appalachia Business Unit Manager at Noble Energy.

Published by: www.cyprus-mail.com