Our View: Lakkotrypis should not be raising unrealistic expectations
Energy Minister Giorgos Lakkotrypis
ENERGY Minister Giorgos Lakkotrypis said that Cyprus would be able to have ‘specific talks’ with Egypt, about the sale of natural gas, at the end of this year, after the completion of the first exploratory drilling by the ENI-KOGAS joint venture. The joint venture is expected to carry out exploratory drilling in plots 2, 3 and 9, and should have preliminary results for one of them by the end of the year, said Lakkotrypis.
Then, there would be talks with Egypt which was facing ‘an energy crisis’ and was desperate to secure a supply of natural gas. The minister was very optimistic in entertaining the idea he would be able to talk business with the Egyptian government by the end of this year. He should know better than anyone else that oil and gas companies, because of the hit-and-miss nature of their work and the equipment they require, operate at a much slower pace than normal businesses. Even the leasing of equipment required for drilling takes months to arrange and months to deliver; and the exploratory drilling, which is followed by more drilling.
How on earth will Lakkotrypis be able to have specific talks with Egypt at the end of the year, when only the exploratory drilling might be completed by then? If the time it has taken Noble Energy to complete one phase of drilling in block 12 – more is reportedly planned – is anything to go by, it will be 2016 before ENI-KOGAS has an accurate indication of the quantity of natural gas under the sea that would be sold to Egypt, assuming it has not secured supplies from elsewhere in the meantime.
Perhaps the minister felt obliged to say something positive after his visit to Egypt, but he should have been more pragmatic. He knows better than anyone else about the slowness at which the oil and gas industry operates and he should be conveying this to the public instead of raising unrealistic expectations. He knows that taking decisions relating to hydrocarbons is a very long-winded process because of the many unknown factors that have to be taken into account and the different players involved in the process. A decision has still to be taken about the construction of the LNG terminal, despite the government’s oft-declared commitment to it, because of these reasons.
This is why it is very important for members of the government to refrain from fuelling speculation and raising expectations. When it comes to hydrocarbons, ministers would be taken more seriously and inspire more confidence about being in control of their brief, the less they say.
Link to source: http://cyprus-mail.com/2014/08/23/our-view-lakkotrypis-should-not-be-raising-unrealistic-expectations/
