Friday, October 5, 2018

ENERGY: ExxonMobil to drill offshore Cyprus in Q4 as Turkey renews threats - FINANCIAL MIRROR

05 October, 2018

US energy giant ExxonMobil said on Friday it plans to begin test drilling for hydrocarbons offshore Cyprus later this year despite Turkey warning international firms against such moves.

“Our plan is to drill some time in the fourth quarter, we haven’t got an exact date right now,” senior vice chairman of ExxonMobil Neil Chapman told reporters Friday.

He made the comments after holding talks with Cypriot president Nicos Anastasiades a day after Turkey advised energy firms not to bid for a license to explore for oil and gas in a new block offshore Cyprus.

Cyprus on Wednesday invited France’s Total, Italy’s Eni and ExxonMobil - already licensed to exploit oil and gas in Cyprus’ Exclusive Economic Zone (EEZ) - to bid for unclaimed block 7.

Chapman said, “we have not looked in any detail at block 7 yet”.

He said the focus of the meeting were plans to drill exploration wells in block 10 licensed to ExxonMobil and Qatar Petroleum.

Turkey has reacted angrily to a decision by Nicosia to invite energy players Total, ENI and ExxonMobil to bid for a new license to exploit oil and gas in block 7 of its exclusive economic zone.

In a statement on Thursday, the Turkish Foreign Ministry advised “companies that might be interested in participating in the tender to act with common sense and to duly consider the realities on the ground”.

Ankara claims that an “important segment” of block 7 “remains within the outer limits of Turkey's continental shelf in the Eastern Mediterranean”.

Turkey said it will continue to take all the necessary measures to protect its rights and will not allow any third party to conduct exploratory activities for the development of hydrocarbon fields in the region.

“Turkey has never allowed and will never allow any foreign country, company or ship to conduct unauthorized research activities regarding natural resources within its maritime jurisdiction areas,” said the statement.

Chapman said these matters were for governments to resolve.

“Any government issues, boundary disputes, borders, that’s for governments to discuss and for governments to resolve that’s not ExxonMobil’s business,” said Chapman.

Cyprus has pushed ahead with exploring for offshore energy resources despite the collapse in 2017 of talks to end the country's decades-long division.

That has angered neighbouring Turkey, which has had troops stationed in the country since 1974, when it invaded and occupied its northern third in response to a coup sponsored by the military junta then ruling Greece.

Turkish President Recep Tayyip Erdogan has warned foreign energy companies not to "overstep the mark" in disputed waters off the Cypriot coast.

The Italian state-controlled ENI had to abandon a scheduled drill for gas south of Cyprus in February due to a standoff with Turkish naval ships blocking the way of a drillship.

Texas-based Noble Energy in 2011 made the first discovery off Cyprus in the Aphrodite block estimated to contain around 4.5 trillion cubic feet of gas – it has yet to be commercialised.

The discovery of nearby Egypt’s huge Zohr offshore reservoir in 2015 has stoked interest that Cypriot waters hold the same riches.

Cyprus aims for natural gas to start flowing to Egypt’s LNG facility in 2022, therefore generating its first revenue from natural gas in the same year.