Partners in the Aphrodite natural gas field offshore Cyprus, which include Israel’s NewMed Energy, announced on Wednesday that they were seeking approval from the Cypriot government to build a subsea pipeline that will connect the field to an existing processing and production facility in Egypt.
Israel’s NewMed Energy, formerly Delek Drilling (part of Yitzhak Tshuva’s Delek Group), which owns a 30% stake in the Aphrodite field located in Cypriot waters, said it had presented the Cypriot government with an updated plan for the development of the reservoir, including natural gas processing and production. For this purpose, the Aphrodite partners met with the Cypriot energy minister on Monday to discuss the progress of the development of the reservoir.
The other partners in the Aphrodite gas field, which holds an estimated 124 billion cubic meters of gas, are US energy giant Chevron and Shell, which each own a 35% share.
Chevron, the operator of the field, expects that the new plan will lower originally estimated development costs and bring forward the production start of natural gas from the reservoir as a result of using existing infrastructures in Egypt. The original development plan would have involved the construction of a floating independent production facility in the area of the Aphrodite reservoir.
Discovered in 2011, the Aphrodite natural gas field is located about 170 kilometers (some 105 miles) south of Limassol in Cyprus and 30 kilometers (some 18 miles) northwest of Israel’s Leviathan gas reservoir, one of the world’s largest deep-water gas discoveries. The total cost of the development plan, including the cost of installation of the pipelines to target markets, is estimated at about $3.6 billion.
Both Israel and Egypt have emerged as gas exporters in recent years following major offshore discoveries, as Europe is determined to wean itself off dependence on Russian gas imports. In June, Israel and Egypt signed a memorandum of understanding with the European Union that will see Israel export its natural gas to the bloc for the first time. According to the agreement, Israeli gas could be supplied via Egypt’s liquefied natural gas, or LNG, plants to the EU.
“The regional ties that we have forged create possibilities for regional and global collaborations and infrastructure-sharing, which will help meet demand for natural gas anywhere around the globe,” said NewMed Energy CEO Yossi Abu. “We are making significant progress with development of the Aphrodite reservoir in accordance with the milestones we set in the work plan.”
The partners are seeking to supply natural gas from the Aphrodite field to the domestic market in Cyprus, and to export natural gas by pipeline to other markets, including the Egyptian market, and the global LNG market.
Earlier in May, the partners in the field announced the drilling start of an appraisal well at the field offshore Cyprus, which is expected to take about three months. The appraisal well is drilled to confirm assessments regarding the nature and size of the Aphrodite gas deposit, currently estimated at 4.4 trillion cubic feet. It is also expected to serve as a production well following the completion of the development of the reservoir.