Friday, June 7, 2019
Israel extends deadline for bids in second gas license round to mid-July - PLATTS
London — Israel has extended by a month to mid-July the deadline for bids in its second international gas licensing round due to the number of requests for documentation from interested parties.
The round is offering licenses for 19 blocks within five zones as Israel looks to move forward with upstream developments to help feed an offshore gas pipeline to southern Europe.
"Due to the number of requests received from companies that purchased the documents of the competitive process, they are allowed another month to prepare for submission," the energy ministry said.
The round was launched in November by energy minister Yuval Steinitz who said he hoped to attract new international energy companies to the country's already proven offshore.
Any company holding over 20% of an existing production license will not be able to participate in the current bid round following criticism of work offshore Israel to date, which has been dominated by a handful of companies, including the US's Noble Energy and Israeli explorers Delek and Ratio.
Each of the 19 blocks measure up to 400 square km and each zone, consisting of multiple blocks, is as large as 1,600 sq km.
The zones are located in the southern extent of Israel's economic waters, an area which has been previously licensed in part and had previous seismic research and limited exploration activity.
The round is offering licenses for 19 blocks within five zones as Israel looks to move forward with upstream developments to help feed an offshore gas pipeline to southern Europe.
"Due to the number of requests received from companies that purchased the documents of the competitive process, they are allowed another month to prepare for submission," the energy ministry said.
The round was launched in November by energy minister Yuval Steinitz who said he hoped to attract new international energy companies to the country's already proven offshore.
Any company holding over 20% of an existing production license will not be able to participate in the current bid round following criticism of work offshore Israel to date, which has been dominated by a handful of companies, including the US's Noble Energy and Israeli explorers Delek and Ratio.
Each of the 19 blocks measure up to 400 square km and each zone, consisting of multiple blocks, is as large as 1,600 sq km.
The zones are located in the southern extent of Israel's economic waters, an area which has been previously licensed in part and had previous seismic research and limited exploration activity.
Thursday, June 6, 2019
What do closer Lebanon-Cyprus energy ties mean for Israel - THE JERUSALEM POST
Interesting developments have occurred recently in the Mediterranean Basin. On April 11, the foreign and energy ministers of Cyprus and Lebanon met in Beirut and agreed to accelerate their contacts on energy issues. Specifically, they agreed on intense negotiations to conclude a unitization deal between their two countries. Such an agreement would set out terms for the development of joint resources and the running of joint gas and oil fields, located on both sides of the two states’ economic maritime border.
Lebanese Foreign Minister Gebran Bassil, formerly his country’s energy minister, noted that negotiations would be launched on May 7, at which point both sides would try to map out their points of agreement and disagreement to complete the talks by September. At the same time, a tripartite Lebanese-Cypriot-Greek summit is scheduled to take place in June. The Cypriot foreign minister added that a unitization agreement would send an important and calming message to international energy companies seeking to invest in the region.
The Lebanese are clearly interested in speedy progress on the issue, realizing that their country is lagging behind in developing its energy potential, compared to Israel and Cyprus. Moreover, according to the Lebanese minister, Beirut is planning to carry out an exploratory drill next year along or adjacent to its maritime border with Cyprus.
Aphrodite revenue sharing at 57.1% - 42.9% - KNEWS / KATHIMERINI CYPRUS
The revenue sharing formula is pegged to the price of oil
Cyprus media reported on Thursday that based on the revised agreement reached between the Ministry of Energy and the Noble - Shell - Delek consortium 57.1% of net revenues from the Aphrodite gas field will be received by the Republic of Cyprus and 42.9% by the firms developing the Block 12 reservoir.
The deal is expected to be approved by the Council of Ministers in July as the government is eager to move forward with the project.
The 5% reduction comes amid falling commodity prices and the considerable cost involved in developing an ultra-high depth well
Cyprus media reported on Thursday that based on the revised agreement reached between the Ministry of Energy and the Noble - Shell - Delek consortium 57.1% of net revenues from the Aphrodite gas field will be received by the Republic of Cyprus and 42.9% by the firms developing the Block 12 reservoir.
The deal is expected to be approved by the Council of Ministers in July as the government is eager to move forward with the project.
The 5% reduction comes amid falling commodity prices and the considerable cost involved in developing an ultra-high depth well
Wednesday, June 5, 2019
BP to Redirect Focus From Oil Assets in Egypt to Gas Reserves - YAHOO FINANCE / ZACKS EQUITY RESEARCH
BP plc BP recently announced its decision to divest Gulf of Suez oil concessions in Egypt to an upstream energy firm Dragon Oil. The value of the transaction has not been disclosed yet.
With the divestment, the British energy giant is planning to focus on gas reserves located off the coast of Egypt. The company has already produced first gas from the West Nile Delta development’s second stage. The project entails the production of natural gas from the Giza and Fayoum fields and the integrated energy firm expects peak production of 700 million cubic feet of gas per day.
BP commenced the first stage of the West Nile Delta project in 2017 and is expecting to start gas production from the final stage by the second half of 2019. Notably, in the first stage, BP developed the Taurus and Libra fields, while the final stage involves the development of the Raven field.
Overall, the West Nile Delta is a major upstream project and the company is expecting the full development — comprising the first, second and final stages — to produce roughly 20% of the current natural gas production volumes in Egypt. BP added that the national gas grid will utilize the entire gas being produced from the West Nile Delta.
ENERGY: Cyprus strikes $9 bln gas production deal - FINANCIAL MIRROR
Cyprus will earn $9.3 bln over 18 years from exploiting its Aphrodite gas field after Nicosia renegotiated a contract with industry giant Shell, US-based Noble and Israel’s Delek, the energy minister said Wednesday.
Energy Minister George Lakkotrypis told reporters that a re-working of the production contract ensures the Cyprus government receives an average yearly income of 520 million dollars over the lifespan of the gas field.
“We believe that it is a good deal under the circumstances, it will allow the Republic of Cyprus to earn significant commercial revenues estimated at over $9 billion during 18 years of the well’s lifespan,” Lakkotrypis told reporters.
He said the figures were based on the average price of oil being around $70 a barrel.
Lakkotrypis said under the new deal, the consortium was obliged to keep to a tight deadline to tap the gas reserves.
“Based on the development and production plan that we discussed, we expect the first gas to be extracted by 2024-25."
Previously the consortium had no obligation to stick to a timeline, no natural gas is expected to flow from Aphrodite and be pumped to Egypt via a pipeline.
Contract would see $9.5b revenue over 18 years from AphroditeJune 5, 2019 at 10:13am - IN-CYPRUS
Bouli Hadjioannou
Cyprus should see a total net revenue of $9.5b from the sale of natural gas from the Aphrodite plot to Egypts’ Idku LNG terminal under an agreement between the Energy Ministry and the Noble-Shell-Delek consortium, Phileleftheros reported on Wednesday.
It said the calculations are based on projected average prices over a period of 18 years, beginning in 2024, it added.
The newspaper said that the state will receive an average of $525 m a year for each of the 18 years.
In the first years, and until capital investment made by the companies is paid off, state revenue is estimated at between $200m and $250m.
Once the infrastructure is paid off, the lion’s share will go to the state which can anticipate revenue of some $750m a year, the newspaper said.
Tuesday, June 4, 2019
Israel Expects U.S.-mediated Lebanese Sea Border Talks in Weeks - HAARETZ / REUTERS
Israel expects to launch U.S.-mediated talks with Lebanon on setting their maritime border within weeks, a senior Israeli official said on Tuesday, naming a UN peacekeeper compound in southern Lebanon as a possible venue.
Lebanon has not commented publicly on whether it would attend talks or on any possible timeline.
The United States, which has been sending a senior envoy on shuttle missions between Lebanon and Israel, also has not announced a date or venue but said it is prepared to help them resolve the dispute.
Formally at war since Israel's 1948 founding, the neighbors have long disagreed on border demarcations in the eastern Mediterranean, an issue that gained prominence in the past decade when large deposits of natural gas were found there.
The United States, which has been sending a senior envoy on shuttle missions between Lebanon and Israel, also has not announced a date or venue but said it is prepared to help them resolve the dispute.
Formally at war since Israel's 1948 founding, the neighbors have long disagreed on border demarcations in the eastern Mediterranean, an issue that gained prominence in the past decade when large deposits of natural gas were found there.
Monday, June 3, 2019
Cyprus’ gas export future uncertain, despite discoveries - OFFSHORE MAGAZINE
LONDON – Exploration to date offshore southern Cyprus has proven around 11 tcf of recoverable gas, according to Wood Mackenzie.
Whether the discoveries can be commercialized remains to be seen, said Robert Morris, senior analyst: Caspian and Europe Upstream Oil and Gas.
Cyprus has no domestic gas market only limited potential for development, he pointed out, but there are options for exporting the gas.
One would be through Egypt’s under-used liquefied natural gas (LNG) export infrastructure to the south. This would offer the lowest cost with the fastest time to market and potentially the best netbacks.
But Egypt’s own recent offshore gas finds, including the giant deepwater Zohr field, mean that the LNG facilities are getting busier. This means the earliest for significant spare capacity for Cypriot gas could be 2025 – further if Egypt’s run of successes continue.
Cabinet denies giving up stake in Zohr gas field to foreign company - EGYPT TODAY
CAIRO - The Cabinet's media center revealed Sunday that Egypt did not give up its stake in Egypt’s gas field,Zohr,to a foreign company, stressing that all the rumors on social media are baseless.
Zohr is not the only gas field in Egypt; West Nile Delta (WND), Greater Nooros Area, Atoll Phase 1, and WDDM – Burullus Phase 9B are all important gas fields that add to the national gas production.
Egypt’s total gas production came to 6.6 billion scfd in September, compared to 2017’s average of 5.1 billion scfd and 2016’s 4.4 billion scfd, according to the Petroleum Ministry, meaning that between 2018 and 2017, there was a 29.4 percent year-on-year increase.
Italian Oil Company Eni discovered Egypt's giant gas field, Zohr, in 2015. In December 2017, the company delivered the first gas production from the field estimated at 30 trillion cubic feet, which makes it the biggest gas field in the Mediterranean region.
Delek hopes to start gas exports to Egypt by the end of June - ENTERPRISE
Delek looks set to meet its end-of-June target to start gas exports to Egypt: Israel’s Delek Drilling is on track to begin commercial sales of natural gas to Egypt by the end of the month, with technical testing on the pipelines that will carry the gas currently underway, Deputy CEO Yossi Gvura tells Reuters.
Trial shipments from Israel’s Tamar and Leviathan gas fields were originally supposed to come in March of this year, but capacity restrictions posed by Israel’s domestic pipeline network meant that the imports had to be delayed.
Background: Under the terms of a USD 15 bn contract signed last year, Delek and its partner Noble Energy should supply Alaa Arafa-led Dolphinus Holding with 3.5 bcm from each of the Leviathan and Tamar gas fields for a combined total of 7 bcm. Delek, Noble and Egypt’s East Gas signed a USD 518 mn agreement for a 39% stake in Ashkelon-Arish pipeline operator Eastern Mediterranean Gas (EMG), intended to pave the way for Egypt to begin importing an initial 100 mn scf/d in 1Q2019.
Background: Under the terms of a USD 15 bn contract signed last year, Delek and its partner Noble Energy should supply Alaa Arafa-led Dolphinus Holding with 3.5 bcm from each of the Leviathan and Tamar gas fields for a combined total of 7 bcm. Delek, Noble and Egypt’s East Gas signed a USD 518 mn agreement for a 39% stake in Ashkelon-Arish pipeline operator Eastern Mediterranean Gas (EMG), intended to pave the way for Egypt to begin importing an initial 100 mn scf/d in 1Q2019.
Sunday, June 2, 2019
The government is badly mishandling our gas imports - CYPRUS MAIL
Charles Ellinas
By not considering other import options the government is condemning us to even higher electricity prices
The planned import of liquefied natural gas (LNG) to Cyprus is about to enter a new and worrying dimension which could stifle competition and likely lead to high gas prices and more expensive electricity than ever before.
During a public consultation organised by Cyprus Energy Regulatory Authority (Cera) between April 12 and May 13 regarding its draft ‘Statement of Regulatory Practice and Methodology of Natural Gas Tariffs’ it emerged that the government intends to declare the natural gas market in Cyprus as an emerging market for 10 years, giving monopoly rights to natural gas public company (Defa) and its subsidiary Etyfa, the Natural Gas Infrastructure Company – set up with 30 per cent participation by the EAC to manage the LNG reception, storage and regasification facilities. This is based on a view expressed by the Council of Ministers in 2007 that, under certain conditions, and taking advantage of EU regulations, it was then the government’s intention to declare the gas market in Cyprus as isolated and emerging.
Two companies responded to the consultation call: Greek company Energean and PEC Powerenergy Cyprus. The latter is in the process of building the first private gas-fired power generation plant in Cyprus. Not surprisingly both tabled multiple objections to the government’s intentions.
The fact that only two companies saw the need to take part in this consultation is by itself of concern. There could be many reasons for this lack of interest: lack of understanding, indifference and possibly a belief that the consultation is just a paper exercise that will not alter decisions already made. Whatever the reasons, it does not bode well. The end result could be higher energy costs for the already heavily burdened Cypriot consumer.
The planned import of liquefied natural gas (LNG) to Cyprus is about to enter a new and worrying dimension which could stifle competition and likely lead to high gas prices and more expensive electricity than ever before.
During a public consultation organised by Cyprus Energy Regulatory Authority (Cera) between April 12 and May 13 regarding its draft ‘Statement of Regulatory Practice and Methodology of Natural Gas Tariffs’ it emerged that the government intends to declare the natural gas market in Cyprus as an emerging market for 10 years, giving monopoly rights to natural gas public company (Defa) and its subsidiary Etyfa, the Natural Gas Infrastructure Company – set up with 30 per cent participation by the EAC to manage the LNG reception, storage and regasification facilities. This is based on a view expressed by the Council of Ministers in 2007 that, under certain conditions, and taking advantage of EU regulations, it was then the government’s intention to declare the gas market in Cyprus as isolated and emerging.
Two companies responded to the consultation call: Greek company Energean and PEC Powerenergy Cyprus. The latter is in the process of building the first private gas-fired power generation plant in Cyprus. Not surprisingly both tabled multiple objections to the government’s intentions.
The fact that only two companies saw the need to take part in this consultation is by itself of concern. There could be many reasons for this lack of interest: lack of understanding, indifference and possibly a belief that the consultation is just a paper exercise that will not alter decisions already made. Whatever the reasons, it does not bode well. The end result could be higher energy costs for the already heavily burdened Cypriot consumer.
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