Noble eyes ‘huge’ chance
Noble Energy sees a “huge opportunity” in the Eastern Mediterranean, according to statements made during presentations to investors.
“In the Eastern Med… we really unlocked and uncovered a huge opportunity in regional gas monetisation,” said Chief Operation Officer David Stover, speaking during the announcement of the company’s results for the fourth quarter of 2014 on February 19.
“There is a huge opportunity there that can provide some economic benefits across the region and also could be a key catalyst for some potential regional stability in economic relationships between countries,” he added.
The Cyprus Aphrodite field remains on the agenda, despite the company’s intention to cut investment by 40% due to uncertainty in commodities prices.
“We continue to progress plans for development for Cyprus for our discoveries there to provide another option for meeting regional demand,” said Stover.
“We think Cyprus can still play a role in the whole east Mediterranean regional picture. We see that the market potential needs are double the size of what we already have signed as Letters of Intent (LOI) so there is definitely a role to be played as there.”
Earlier this month, Cyprus signed a preliminary deal with Egypt to transfer gas through a direct marine pipeline from the Aphrodite field, which has been estimated to hold 4.54 trillion cubic feet (tcf).
Noble Energy has also signed Letters of Intent to provide Egypt and Jordan with natural gas from the Israeli fields.
Stover described the region as “an opportunity that can get near-term impact, requires little capital and will provide a relief from the gas shortage in Egypt.”
Noble’s plans for the region were further delayed for another two months as the Israeli Antitrust Authority postponed its decision to April (after the March 17 elections) on whether to designate Noble and Delek’s interests in the Tamar and Leviathan fields as a cartel.
The Israeli government also expects oil companies to agree to a domestic sales mechanism which will determine maximum government-set prices for domestic sales.
Stover said that further investment in the expansion of Tamar and the initial development of Leviathan “have been suspended until regulatory issues are resolved”.
Last week the Israeli authorities and the exploration companies failed to reach an accord that would at least allowed the development of Leviathan.
Dr Charles Ellinas, former Executive President of Cyprus National Hydrocarbons Company, told the Cyprus Weekly that the potential delays in the development of Leviathan could affect negatively regional deals.
“The industry’s view is that these regulatory disputes and uncertainties have created major setbacks with the risk of pushing investors away from the region.”
Gas fields in the East Med are deep-water and relatively expensive to produce, Ellinas noted. He added that “the right conditions need to be put in place and maintained to ensure the necessary investment and long-term natural gas trade can take place”.
Source: http://in-cyprus.com/noble-eyes-huge-chance/
