Cyprus could start selling gas to Egypt by 2018, Lakkotrypis says

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By Stelios Orphanides

Cyprus may start selling natural gas to Egypt by as early as in 2018 if the two countries reach a final agreement to link Cyprus’s first natural gas finding in Aphrodite field operated by US Noble Energy Inc. to one of Egypt’s liquefactions plants in Idku or Damietta, Energy Minister Giorgos Lakkotrypis said.

The two countries agreed yesterday to speed up talks to export Cypriot gas to Egypt via underwater pipeline. The gas could then be both used to cover the country’s energy needs and be liquefied for export.

Before a final decision is taken, questions remain to be cleared including studying the morphology of the seabed or the potential use of existing infrastructure, Lakkotrypis said.

“For instance, there are some facilities near Idku which could save us 80 kilometers of pipeline,” he said in an interview with state radio CyBC today and added “the most important thing is to see who the counterparty is, whether it is solvent, whether it has guarantees, whether it is in our interest to go ahead with Idku or Damienta”.

The companies managing the terminals are prepared to construct the pipeline, “i.e. British Gas in the one case and Union Fenosa in the other, but this is something that will be examined now,” the minister said.

The construction of the pipeline to Egypt could begin before that of infrastructure that would allow the processing of the Aphrodite natural gas in situ, which would allow “recoverability of the reserve and the use of the gas at the domestic market,” the minister said.

He added that at a later stage, the proposed pipeline could be also extended to tap gas from Israel’s Leviathan reserve.

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About Author

Stelios Orphanides is a journalist at CyprusBusinessMail.com. To contact Stelios Orphanides: [email protected]

  • RebelJim

    Don’t count your chickens before they are hatched, remember Cyprus dealing with Junta,

    • Dave The Impaler

      Junta’s, illegal occupation regimes, Ottoman Sultans. It’s all the same.

      • RebelJim

        greece 1974

        • Dave The Impaler

          Don’t wish to alarm you dude but this is 2014.

        • A.Papas

          What do you know about Greece 1974?

  • Brian Whiffen

    three could ‘s mean it once again hasen’t been thought through yet, until further explorations prove there is a viable reserve of gas then all the airy fairy ideas they come up with are just that ideas, However one thing seems to be sinking in and that is a pipe line is the best option to sell the gas on [if there is enough ]

    • John Aziz Kent Kent

      Brıan Whıffen
      THERE IS PLENTY OF GAS THERE OBVIOSLY IF EVERY BODY IS SO
      INTERESTED BUT FIRST OF ALL SATISFY THE REAL ORIGINAL PARTNERS
      BEFORE YOU START SELLING TO THE WHOLE WORLD AND ANNAUNCE IT
      NOW NOT IN 50 YEARS MORE TIME AND MORE DISASTERS TO FOLLOW
      GREED IS THE MOST DANGEROUS INSTRUMENT TO BRING PROBLEMS

      • Brian Whiffen

        firstly do no be so rude as to shout.. we are not deaf or blind

        secondly the only confirmed figures we have seen at the moment is from Nobel estimating a minimum of 3.5tcf with a possibility of up to 10tcf, with the wholesale price of gas having lost over 30% in the last 4 yrs the minimum estimate would not be viable

        • John Aziz Kent Kent

          ABOUT MY WRITING  WITH CAPITAL NUMBERS I APOLOGISE BUT MY EYE SIDE IS NOT SO GOOD ANY MORE IT MUST BEBEACOUSE OF MY AGE  OF 80 YEARS  NOW LET ME ASKMR BRIAN WHIFFEN IS GAS MORE VALUEBUL THAN THE CYPRIOT PEOPLE? JUSTTO SATISFY OUR GREED WE CANNOT AND WE MUST NOTSACRIFICE ALL THE TIME OUR PEOPLE GREEK OR TURKISHAS WE DID AWAY BACK IN 1954-1960 WHEN EOKA STARTED THE ENOSISGENOCIDE AND THEN THE 1974 TURKEY CAME AND SAVED US ALLGREEKS AND TURKS AS AGUARANTOUR STATE GOT INVITED BY MAKARIOSYOU SEE BRIAN BEEING 80 YEARS OLD I HAVE LIVED IT ALL PARTLY IN CYPRUS PARTLY THANK YOU ENGLAND FOR HAVING ME

          • A.Papas

            I don’t think it’s just your eye SIGHT, that you are having problems with. Your “facts” are totally skewed.

  • guest bernard

    A while before 2018, who knows what could happen by then? New Government in both Egypt and ROC.

    • Dave The Impaler

      probably just wishful thinking

      • guest bernard

        No a certainty, at least in a democracy like ROC, not so sure about Egypt, but
        who knows, the people in Egypt have risen up before.

        • Dave The Impaler

          A change of governments in democracies is inevitable you’re right about that but Egypt badly needs the gas. They probably will be Cyprus’s first customer.

          • Alexander Reuterswärd

            There is a large amount of exporters of gas in the world, Egypt has already signed that they will buy gas from Israel as one example..

          • Dave The Impaler

            Given the choice and sensitivities regarding Israeli Arab relations. Egypt would probably buy Cypriot gas rather than Israeli

          • Alexander Reuterswärd

            nopes, they have a good relationship today and as in all countries business is business (just look at europe buying russian gas no matter what sanctions and russia is happy to sell it)

          • Dave The Impaler

            you’re behind with the times dude, I suggest you read the FT

          • Alexander Reuterswärd

            in what area am i “behind”, specify what news please.

          • RudyDajuda

            Ceratinly they choose for the more expensive solution? why should they insist to by the Cypriot gas?

    • Salomi

      you never know!

  • FedUp

    The question is, will it be Cyprus or Kibris selling the gas?? Get back to the negotiating table and work towards a solution ffs!!!

    • Dave The Impaler

      It will be KIPROS, don’t worry about that

      • FedUp

        Thanks Dave for your assurance, I feel a lot better now!!!

        • Alexander Reuterswärd

          It will be Noble that sells the gas and no one else 😉

          • Dave The Impaler

            True but Cyprus will be collecting the taxes

          • FedUp

            Surely you mean Kipros Dave?? You’re getting me worried again!!!

          • Dave The Impaler

            yes you’re absolutely dude but let me reassure you that Cyprus (Κύπρος) will be collecting the gas taxes

          • Alexander Reuterswärd

            IF Noble decides that it is profitable to build the pipeline and extract the gas

        • Dave The Impaler

          You welcome, anytime

  • Alexander Reuterswärd

    Dont forget 😉
    Noble have to investigate if it is profitable to extract the gas and sell it to Egypt at whatever price the world marketprice is.

    The investment of a pipeline is high, will it be profitable with the limited amount of gas that is in the area?

    • A.Papas

      What amount of gas is limited, please explain.

      • RudyDajuda

        Limited means, not endless like the Cyprus issue…..

        • A.Papas

          So, you don’t know.

      • Alexander Reuterswärd

        The amount of gas that Noble has found is limited, and it is not a massive found.

        Lets say that they found 1000 units and the cost to build the pipeline is 100, than the extra cost for the gas is 10%/unit

        If they found 10000 units, the cost would only be 1% so the amound they found is extremely relevant in relation to the cost to extract and transport it.

        • A.Papas

          How much have they found, and how did you decide it was limited.

          • Alexander Reuterswärd

            Do you think that once you start drilling the gas will flow forever?

            It is just like if you open a bottle of wine, you can only keep on drinking as long as there is something left in the bottle.

            The amount they found is estimated at 4 tcf (it might be 3 and might be 5, now how much gas is that in rality?

            Europe used 541 tcf in 2013, so all the gas Noble found would last a little over a month to feed Europes needs.

          • A.Papas

            So, with that info, it qualifies you to tell Noble how to run it’s business…lol

          • Alexander Reuterswärd

            How do i do that?

            All i wrote is that Noble will make a decission based on cost to extract and cost to transport the gas and that there is no guarantee that they will find it profitable enough to make the investments needed at the cost of gas that there is today.

            They are very skilled and i am sure that they make correct decissions that will benefit the shareholders.

  • Brian Ellis

    If this can be done, it makes a lot of sense, much more than piping the gas to Cyprus

  • Road Warrior

    Lakotrypis has lost the plot, what gas, the gas that will almost certainly remain exactly where it is until Turkey say otherwise. As one of the esteemed contributors stated very recently in the Cyprus Mail, not only could Turkey prevent any of the gas being recovered, it could, by the presence of it’s warships, kill off the only asset which is still making any money for the republic, it’s tourist industry.

    Am I saying they would be right to do it, no, am I saying that they should do it, no, all I am saying is that it could happen. Both sides should be back at the table.

    • A.Papas

      It’s our gas, it has absolutely nothing to do with Turkey or any other state, pseudo or not They should,the Turks, like you should mind their own business, and keep their noses out of our EEZ..

      • Road Warrior

        And why is it not my business ?

      • Anon

        When you say ‘our’ EEZ …do you mean The Greek ‘and ‘Turkish Cypriots ? That you have Unilaterally claimed as yours and excluded to date in all commercial discussions ..

        • Road Warrior

          He has possibly excluded all other nationalities, living in Cyprus, paying their taxes and their mortgages, supporting the economy.

          • Anon

            No doubt

          • A.Papas

            You know exactly what I mean, or have you reached the limits of your intelligence?

          • Road Warrior

            No, but I’ve probably reached the limits of yours.

          • A.Papas

            lol

    • John Aziz Kent Kent

      Road warrıor
      Cyprus ıs prepared to share the Gas whıch some of ıt belongs to the Turkısh sıde
      Wıth other natıons but excludes the partner Turkey not only that but wants TURKEY
      To get out of theı rown back garden the MEDITERENIAN untıll the solutıon to the
      60 years on goıng Cyprus problem they started to have ENOSIS achıeved wıth the
      Backıng of the murderous EOKA kıllers kıllıng GREEKS TURKS and every body else that dıd not agree wıth EOKA now they dont want to share the HYDROCARBON for untıll they decıde to have a solutıon IN ANOTHER 50 YEARS the EU especıally ıs most to be blamed ıf a bıg problem erapts our only hope now remaıns wıth USA
      and UK to put thıngs ınto some kınd of a reasonable and faır based on TRUTH
      Agreement before ıt goes any further shurely the World must see the rıght and wrong
      WHO started all the problems ın thıs beautıful ISLAND forcıng others to clear the
      mess we all have to endure just to satısfy theır GREED and EGOS the ordınary
      Greek andTurkısh people have to put up wıth all that and be under EMBARGOS
      As well through no fault of theırs PROVOKING ISTHE MOST DANGEROUS INSTRUMENT AS IT HAPPENED IN THE PAST DESTRUCTIONS

  • Anon

    The only Gas Leaving Cyprus for Egypt is out of the Orifices of the political elite

    • A.Papas

      …and you?

      • Anon

        There is so much Gas around me.. Turkey has sent a boat

        • A.Papas

          Thanks for confirming my point.

          • Anon

            Your point ? Do you have a one ?

          • Alexander Reuterswärd

            His point is that he has no clue what he questions 😉

          • Anon

            You may have a point 😉

          • A.Papas

            My point is that you don’t have a clue, and the only reason is that you, and others, are only here to troll.

          • Anon

            I do have a clue and your insults say more about you than they do me…
            This forum encourages opinion but people like you, who look for arguments , are in the minority , thank god . You are the troll so please take your finger out of my face .

          • A.Papas

            Please re-read your original post and then tell me who is insulting who.

          • Anon

            Are you , or do you consider yourself , part of the ROC’s political elite ?

          • A.Papas

            Are you upset because I called you a troll for insulting the political elite, whoever they are?

          • Anon

            Can you , or do you know how to , answer a question without being Rhetorical ? Ill ask again ..
            Are you , or do you consider yourself part of the ROC’s political elite ?
            In other words , an official spokesperson for government’s affairs who has authoritive powers to make headline statements which will be taken seriously by the associated press ?

          • A.Papas

            It’s besides the point, if I am or not, the fact is, is that I feel offended by your crass statement.
            Why did you post that, in my opinion you posted it, to offend or insult. This is what trolls do.

          • Anon

            In other words .. you are not .
            The answer you are looking for is ‘no’.
            The original comment was not aimed at you and therefore , by you responding to my statement that makes you the ‘troll ‘.
            The statement reflects on my opinion that this headline on this article is nothing but ‘hot air’ or ‘gas’ used to insult or antagonise the Turkish Cypriots rights to the Hydrocarbons , who have been excluded from any discussions with third parties .
            Turkey have made it clear they will not accept this and therefore the statement in the article in my opinion is nothing but sabre rattling and unhelpful to finding a solution .
            Now , ill gladly continue discussions with you on the basis that you act maturely as opposed to the childish like manner you are currently displaying .

          • A.Papas

            If you want to insult someone please write them a letter, or better still, face to face, not in a public forum, although with a very limited readership, which consists mainly of disgruntled, and bigoted expats.
            The “Turkish Cypriots” has zero rights to anything that belongs to the indigenous people of Cyprus, including land sea and airspace.
            The majority of “Turkish Cypriots” left the island in 1914 and late 1920’s.
            Whatever the “TC’s” think they own is stolen property, stolen by them and their ancestors.
            Out of the Goodness of our hearts we have tolerated you since that black day you first put a foot on this island, back in 1570.
            You invaded this land in 1570, killed 30,000 innocent and helpless men women and children, over 20% of the population, raped men, women and children, looted and burnt our belongings, and you ruled over us for over 300 years, treating us like ….etc
            To cut a long story short, in 1983 the pseudo state of the “trnc” was declared an independent state, and the terrorist, Denktash said, “whatever North is ours and whatever South is yours” or words to that effect. Now in 2014, all of a sudden you want a substantial share of our hydrocarbons, which is located south of your dividing line.
            As I said you have zero rights to anything Cypriot.

  • The energy minister does not inspire confidence – BG Group run the gas operations in Egypt and are nothing to do with British Gas. Also BP are ramping up their gas field in the Nile Delta to supply the BG LNG plant so not sure of the feasibility of laying a 250km pipe lime from the Aphrodite Field to Damietta?

    • Alexander Reuterswärd

      build expectation, no one will know the result before the next election so he can secure more envelopes 😉

      • A.Papas

        What envelopes?

        • Alexander Reuterswärd

          Check the corruption index 😉

          • A.Papas

            Please supply a link.

          • Alexander Reuterswärd

            Search “corruption” in cyprus mail to start with
            Corruption poll results
            57 per cent of 2013 Eurobarometer respondents in Cyprus report that corruption affects their daily lives – EU average 26 per cent
            92 per cent of Cypriots say that bribery and the use of connections is often the easiest way to obtain certain public services – EU average 73 per cent.
            83 per cent of Cypriots – the highest in the EU – say that the only way to succeed in business is through political connections.

          • A.Papas

            Hold on, you are talking here in general.

            “build expectation, no one will know the result before the next election so he can secure more envelopes ;)”

            Here in your quote, you have accused the Energy Minister Giorgos Lakkotrypis of receiving envelopes.
            What evidence have you that he receives “envelopes”?

          • Alexander Reuterswärd

            ;)everything here is in general, but yes i do think that this minister has taken and will take envelopes in the future.

          • A.Papas

            Please show us some proof. You do have proof don’t you?

          • Alexander Reuterswärd

            you should stop taking everything so literary and see the conversation about envelopes in this discussion (and every other discussion where i and other friendly people use the term) as a term of misstrust and not as a direct accusation my friend 😉

            Now start to see discussions as this as a way to voice opinions in a fun and sometimes exagerated way 🙂

          • A.Papas

            No thanks, I would rather not have “fun” at other peoples expense.

            So, this will be your defence when the Energy Minister sues you for libel?
            Personally I think that you need to grow up, and stop hurling personal insults, as like sarcasm it’s the lowest or in my opinion even lower, form of wit.

          • Alexander Reuterswärd

            I have personally been sitting in a meeting with a very close family to the president we have today been offered a guarantee to get a project in the energysector coming in place if a “consultanty” fee of XXXXXXXX each X represent a number is paid.

            So you are welcome to think i have sarcasm and so on, by the way i have my name written here and am not anonymous like you.

          • A.Papas

            Where did I say that?

  • Bystander

    Cyprus can start selling gas today to anyone who is willing to buy. Actual gas can be extracted and deliver later. Is this what they call “futures”?

  • Peter Davis

    We spent money converting two electricity station to run on gas instead of diesel oil, but because of the unions this never happened. Why can’t we supply these stations instead of exporting to a poor 3rd world country.

    • Jessica Spencer

      because that makes sense and this way they can keep charging us alot more, so for them its a win win

  • R Smyrna

    Today the natural resources are inexpensive… a decade from now???

    With the geometric rise in the world’s population… Every natural resource supply will not meet the world wide demand.

    The Cypriot oil and gas fields, are money in the bank.

    In the 1980s, gas wells were being discovered, in the north part of my state. They were immediately capped, and not recovered, until this last decade. Now they are supplying inexpensive gas to our entire region. Most of our power plants are gas fed.

    • Alexander Reuterswärd

      the difference is that solar, wind and water has developed and is getting very affordable and effective today, that is the power of the future and fossil fuels will be less attractive with higher taxes to protect the enviroment.

      • peemdubya

        So why aren’t there acres and acres of solar farms – we have ~330 sunny days / year in Cyprus but have to have those not-often-turning windmills on the hills near Paphos and Larnaca airports. If that was an environmental nod to the EU then someone forgot to check the environmental sustainability figures of wind turbines against solar panels – yet again, Cyprus never fails to amaze!!!!!

  • Really?

    Strange, where are the massive condemnations of cooperation with the egyptian regime?

    Oh, that’s right. They are arabs, not jews, so different standards apply. (sarcasm intended)

  • cemal aslan

    Another no brainer-Another idiot who doesn’t know what the both parties signed under the conditions of the “Production Sharing Contract”
    The crux is the FID which the E&P contractors will take on the basis of profitability and cost drivers! ROC has nothing to sell to Egypt because it’s not ROC’s gas to sell but belongs to Noble/Delek/Avner…It’s not public info and the Sharing Agreement says that the driller gets paid first to recoup his/her total expense. Then the profit share arrangement kicks in…
    LET the politicians to talk whatever they like – what gas/which gas? non-present – not proved to date to have hc accumulations – gas belongs to Noble Energy & Partnerships as contingent and prospective resources on the balance sheet/portfolio as “ASSETS” for 25 yrs. with respect to the “PSC” – A host country is only entitled to get profit sharing, nothing more nothing less…..Fiscal regime -“R” factor is applicable-ZERO taxation-no VAT… Economic terms with respect to the cost oil/gas recovery and to the profit oil/gas sharing -Cost Oil/Gas recovery (up to a max. %) – Profit Oil/Gas sharing % (according to production tiers and prices)-signature & production bonus – Annual surface fees from the produced oil/gas under the terms of production sharing contract with respect to contract area and this is a common practise in the industry between the parties & a host country regarding the % of production IF such oil/gas can by itself be commercially produced.. RoCyprus will only benefit 25% of profit sharing – 10% ROYALTIES – 15% CORPORATE TAX – “R” Factor is based on , Economic terms with respect to the cost oil/gas recovery and to the profit oil/gas sharing -Cost Oil/Gas recovery (up to a max. %) – Profit Oil/Gas sharing % (according to production tiers and prices)