NICOSIA, Cyprus — Cyprus will earn an estimated $9.3 billion over 18 years from exploiting its Aphrodite gas field under a renegotiated contract with Shell, US-based Noble and Israel’s Delek, the energy minister said Wednesday.
George Lakkotrypis told reporters that a reworking of the production contract ensures Cyprus receives an average yearly income of $520 million over the lifespan of the gas field.
“We believe 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.
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,” he said, whereas the consortium previously had no obligation to stick to a timeline.
It was the “biggest development project” on the island with around $7.9 billion invested in infrastructure.
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 (127 billion cubic metres) of gas but it has yet to be commercialized.
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 an Egyptian LNG facility via pipeline.
It has pushed ahead with exploring for offshore energy resources despite the collapse in 2017 of talks to end the island’s decades-long division.
That has angered 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.
Last month, Turkey sent a drillship inside Cyprus’s exclusive economic zone after announcing it would begin its own energy exploration.
In February, ExxonMobil and Qatar Petroleum discovered a huge natural gas reserve off the coast of Cyprus, holding an estimated five to eight trillion cubic feet.
Italy’s ENI and Total of France are also heavily involved in exploring for oil and gas off Cyprus.