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    Lakkotrypis: The Mediterranean Could Provide the EU with Energy Security

Summary

Minister Yiorgos Lakkotrypis at the EU energy council in Luxembourg: Exploiting its own resources in the Mediterranean could provide energy security to the EU.

by: Karen Ayat

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Featured Articles, News By Country, Cyprus, East Med Focus

Lakkotrypis: The Mediterranean Could Provide the EU with Energy Security

Cyprus’ Minister of energy Yiorgos Lakkotrypis asked for EU support when speaking at the EU energy council in Luxembourg on Tuesday 15 June 2015. The Minister reiterated the importance for to EU to seek energy security by diversifying its sources of supply. Exploiting “its own resources” in the Mediterranean could provide the EU with the security of energy supply, said the minister, which would improve the lives of the European citizens.

Cyprus made a major discovery off its coast in 2011 when Noble Energy discovered the Aphrodite field estimated at 4.54 Tcf. The ENI-KOGAS consortium has also searched for gas in Cyprus’ Exclusive Economic Zone but faced two dry holes in Block 9 of the island’s maritime waters. France’s TOTAL, licensed to drill in Blocks 10 and 11, has delayed its involvement in Cyprus for not having identified "drillable prospects" as per the company’s announcement in early 2015.

Cyprus’ Aphrodite field could ensure energy independence for the island for decades to come. Cyprus is currently looking for regional customers for its gas. The partners in the field have declared it commercial and a development and production plan for the Aphrodite field was submitted by the partners to the Cypriot government. Noble and its Israeli partners Delek and Avner have proposed a floating facility to produce and treat the gas on-site with a daily capacity of 800 million cubic feet. The estimated cost for the development of this infrastructure is between $3.5bn and 4.5bn. A final investment decision is estimated by 2016, and the commencement date of supply of natural gas from the field is estimated by the first half of 2020.

Cyprus is targeting the Egyptian market as a potential customer for its gas. Egypt is undergoing a severe energy crisis that has led the country to look for regional potential suppliers, including Israel and Cyprus, to meet an increasingly growing domestic demand. Exporting the gas to Egypt could potentially allow Cyprus to use Egypt’s export terminals to reach far-reaching markets.

Since the discovery of natural gas in the Eastern Mediterranean, a new geopolitical landscape has been taking shape. Earlier this week, the President of Cyprus Nicos Anastasiades travelled to Israel where he met with high ranking officials to discuss potential energy collaborations. President Anastasiades Anastasiades was accompanied by Foreign Minister Ioannis Kasoulides, Minister of Energy, Commerce, Industry and Trade Yiorgos Lakkotrypis Government Spokesman, Nicos Christodoulides, and other senior government officials. Israel has been reluctant to join forces with Cyprus to build joint export facilities. However, the relationship between Israel and Turkey remains strained despite diplomatic efforts to normalise diplomatic ties. A stronger partnership between Israel and Cyprus in the field of energy is possible.

Karen Ayat is an analyst and Associate Partner at Natural Gas Europe focused on energy geopolitics. Karen is also a co-founder of the Lebanese Oil and Gas Initiative (LOGI). She holds an LLM in Commercial Law from City University London and a Bachelor of Laws from Université Saint Joseph in Beirut. Email Karen karen@minoils.com Follow her on Twitter: @karenayat