CYPRUS: Gas pipeline to Egypt a done deal but there is a snag - FINANCIAL MIRROR

07 August, 2018

Nicosia and Cairo have agreed to build a gas pipeline from the Aphrodite field in Block 12 to Egypt, but those reserves could remain untapped in a row over profits.

The deal could come unstuck if the government does not strike a compromise on profit sharing with the consortium licensed to exploit Block 12.

CyBC TV said the agreement, already approved by Brussels, is undergoing the finishing touches before it is signed at an official ceremony in the Autumn.

An Energy Ministry official has briefed the political parties on new demands by US firm Noble, UK-Dutch Shell and Israel’s Delek to exploit Aphrodite gas.

They want a change in the product-sharing contract which outlines the percentage of revenues to be received by the state in any commercial deal.

The three companies have proposed a ratio change of 60-40 in favour of the Republic of Cyprus be reversed so that Noble, Shell and Delek receive the lion’s share of the 60% instead.

Such a reversal in the profit ratio would see the state lose in the region of €2.5 bln to the consortium.

Delek, Noble and Egypt said to put final touches on gas deal - WORLD OIL

8/AUGUST/2018MIRETTE MAGDY and YAACOV BENMELEH

CAIRO and TEL AVIV (Bloomberg) -- The companies developing Israel’s largest natural gas fields and their Egyptian partner have finalized details of a deal that would give them control over a pipeline to Egypt, according to people familiar with the matter, a crucial step that would pave the way for a $15-billion export contract.

The deal involves setting up joint venture companies in Cyprus and the Netherlands, through which Israel’s Delek Drilling LP, U.S.-based Noble Energy Inc. and their Egyptian partner, East Gas, would buy a 37% stake in Eastern Mediterranean Gas Co., held by businessmen Sam Zell and Yosef Maiman, among others.

An initial agreement is expected to be signed in a month or less, the people said, speaking on condition of anonymity because the negotiations are confidential. Separately, efforts also involve a substantial reduction of a $1.76-billion fine imposed on Egypt by an arbitration court in favor of Israel Electric Corp.

The agreements would eliminate legal obstacles to implementing the gas export contract, seen as a step adding economic depth to a relationship dominated by security since the two countries signed a peace treaty more than four decades ago. It would also advance Egypt’s plan to capitalize on its own giant Zohr gas field and become a regional energy hub.

Shares of Ratio Oil Exploration 1992 LP, a partner in an Israeli gas field that is party to the export deal with Egypt, rose as much as 3% on the news. The Tel Aviv Oil & Gas Index gained as much as 0.9% to 902.58, the highest in one month.

The deal is shaping up as follows:

TurkStream's 2nd Leg to Become Operational by December 2019 – Turkish Minister - SPUTNIK NEWS

08.08.2018 15:21

ANKARA (Sputnik) - The second leg of the TurkStream gas pipeline is expected to be put into service by December 31, 2019, Turkish Energy and Natural Resources Minister Fatih Donmez said Wednesday, citing information provided by Russian energy giant Gazprom, which is involved in the construction project.

"The construction of the offshore portion of the first leg of TurkStream has been completed. Gazprom built it on its own. They covered a 930 kilometer [578 mile] route. Now, construction of the land portion is underway. Gazprom continues laying down the second leg of the offshore part [of the pipeline]. Gazprom has notified us of the date [it will become operational] — December 31, 2019," Donmez told A Haber TV Channel.

The TurkStream pipeline will have a capacity of 15.75 billion cubic meters (556 billion cubic feet) per year. One leg is expected to supply natural gas solely for Turkish consumption.

The second leg will transport gas to European countries through Turkey, and is scheduled for completion in 2019. Gazprom is considering options for extending the pipeline through Bulgaria and Serbia or through Greece and Italy.

The new Cypriot-Egyptian agreement regarding the natural gas pipeline - LYGEROS

7 August 2018
Nikos Lygeros

The new agreement between Cyprus and Egypt regarding the natural gas pipeline, which carries the European Union's necessary stamp of approval, is the implementation of the intermediate path towards the exploitation of the mineral wealth.

It constitutes a new success which enhances the alliance context with Egypt, but also the triple point of contact issue, where Greece is also involved, at both geopolitical and geo-economic levels, since it will also have an impact upon the East Med pipeline which is of strategic importance.

The other important element is that it regards a transnational agreement that goes beyond European Union issues.

Therefore it constitutes an effective response to Turkey's provocative statements.

It's indicative in practical terms that Egypt functions catalytically in regards to this relationship, and that the two countries now obtain mutual interests, a factor which is very important at a geostrategic level.

With this agreement, Cyprus acquires an energean ally which has a European orientation, both politically and technologically.

Consequently, Cyprus' position is becoming upgraded and the island can now see differently the Eastern Mediterranean and its interconnection with the European Union.

EGX, Oil Ministry officials begin deliberations over setting up natural gas futures exchange - ENTERPRISE

Tuesday, 7 August 2018

EGX, Oil Ministry officials begin deliberations over setting up natural gas futures exchange: Bourse officials have reportedly started talks with the Oil Ministry to set up a futures exchange for natural gas, banking sources tell Al Mal. Officials met last week to begin discussing their vision for the establishment of energy-oriented futures exchanges, beginning with natural gas, according to the sources, who add that the gas exchange market will be the main platform used for striking gas sale and purchase agreements and determining prices, quantities, and delivery dates. The framework is still in the early drafting stages, the sources said, hinting that we’re still a long way from seeing the market turn into a reality.

Background: The recently-amended Capital Markets Act and its executive regulations included provisions that allow for the establishment of futures exchanges and the introduction of other financial instruments, such as green bonds, sukuk, and margin trading. We had heard in May that Financial Regulatory Authority boss Mohamed Omran had tasked a committee with drafting the rules and regulations that would govern futures exchanges, which are part of a four-year strategy to develop Egypt’s non-banking financial sector. New regulations to govern short-selling are also in the works and expected to be complete by 3Q2018.

Gas pipeline deal reached with Egypt – CyBC - CYPRUS MAIL

AUGUST 6TH, 2018
Evie Andreou

Nicosia has reached an agreement with Cairo on a pipeline to connect the Aphrodite gas field in block 12 to Egypt, it was reported on Monday.

According to state broadcaster CyBC, the inter-state agreement is expected to be signed in the autumn.

The two countries had signed in 2017 a preliminary agreement to transport natural gas from Cyprus to Egypt to be liquefied at Egypt’s LNG facilities and re-exported to Europe and other markets.

CyBC, citing diplomatic sources, said that the agreement has already been given the green light by the EU and it is being scrutinised for the final touches.

Cyprus demarcated its maritime border with Egypt in 2003. The Aphrodite gas field, discovered in December 2011 by Houston-based Noble Energy, is estimated to hold some 4.5 trillion cubic feet of gas.

Edison stops gas exploration in Israel - GLOBES

6 Aug, 2018 18:47
Amiram Barkat

The market sees the decision as proof that gas exploration in Israel is not attractive due to restrictions on gas exports.

Italian company Edison, owned by a French group, one of the oldest foreign investors in the Israeli gas exploration market, has closed down its activity in Israel in recent weeks. The market is interpreting the decision as proof that gas exploration in Israel is not attractive and that the restrictions on gas exports imposed by the Tzemach Committee should be eliminated. Government sources argue that the company closed its office because of strategy changes, not because of anything involving the Israeli market.

Edison's office, managed by Octavio Viglione, was active in Israel for five years and was closed two months ago. As far as is known, the company is maintaining its connection with Lavi Capital, managed by former Ministry of Finance director general Yarom Ariav, which provided it with consultation services and representation for years. As of now, Edison is continuing its activity in the Royee license in which it is a partner with Israeli partnership Ratio Oil Exploration (1992) LP (TASE:RATI.L).

Egypt to Begin Importing Israeli Gas in 2019 - HAARETZ / REUTERS

Aug 06, 2018 10:28 AM

Avi Waksman and Assa Sasson

Egypt’s Dolphinus Holdings plans to start importing gas from Israel for re-export in the first quarter of 2019, sources in the country’s energy sector said on Sunday, under agreements signed in February to buy $15 billion worth of gas over 10 years. “Imports will start in small quantities first and will gradually increase to reach their climax in September 2019,” one source told Reuters. The source gave no details on prices or quantities. Partners in Israel’s Tamar and Leviathan offshore gas fields, which include Delek Group, Isramco and Ratio, said in February that they would supply Dolphinus with around 64 billion cubic meters of gas over a decade. Although controversial in Egypt, Cairo hopes that the imports will help in its efforts to become a regional energy hub. Delek shares ended up 0.4% at 528.60 shekels ($143.15). (Reuters)

Indications that gas finds will be high in block 10 - CYPRUS MAIL

AUGUST 5, 2018

Elias Hazou

ExxonMobil and Cyprus could hit the jackpot later this year when the US energy behemoth bores down into the seabed in search for natural gas. But according to an energy analyst, the potential windfall could have broader ramifications for the government’s arrangements with other companies operating in the island’s exclusive economic zone.

Charles Ellinas tells the Sunday Mail of highly sanguine chatter inside the industry over the potential of block 10, located southwest of Cyprus and licensed to a consortium of Exxon and Qatar Petroleum.

The seismic data is extremely encouraging.

Weeks ago, Ellinas was speaking to a senior executive of one of the companies that had bid for block 10 but did not get the contract.

“He told me: ‘If they [Exxon] don’t find something big there, I’ll quit my job’.”

Natgas market regulator sets fees for private sector’s use of the state grid at USD 0.38 MMBtu - ENTERPRISE (Corrected)

Sunday, 5 August 2018

The Natural Gas Regulatory Authority set on Thursday the fee that private sector players will have to pay to use the state’s national grid to transport gas at USD 0.38 / MMBtu, according to its official website. The rate applies for the first year of the program, suggesting a revision could be in the works after the initial trial period. License fees will be calculated based on the amount of gas transferred and can be settled in EGP. The regulator will be issuing permits for different types of commercial gas market activities, including grid operations and maintenance, supply, distribution, and shipping, with different fees set for each type as follows:

• USD 0.57/MMBtu for transmission licenses;
• USD 0.31/MMBtu for shipping licenses;
• USD 0.23/MMBtu for distribution licenses;
• USD 0.08/MMBtu for supply licenses.

Permit requests must be processed within 10 working days of application and any additional documents required by the regulator must also be submitted within 10 working days. The regulator will then have 45 days to approve or deny the request and fees must be deposited within seven days of that date.