Complications for Cyprus as appraisal drills point to significantly reduced amounts of gas

Complications for Cyprus as appraisal drills point to significantly reduced amounts of gas:

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image: eoimages.gsfc.nasa.gov

Cyprus is facing a dilemma with regards to its natural gas strategy, as highly credible information has been leaked over the past few days to local media suggesting a significantly reduced amount of gas for Aphrodite Block 12. This would effectively terminate the chances of establishing an LNG terminal and cooperation with Israel looks like the only way out.

The findings of the first appraisal drilling by Noble Energy point to less than 5 tcf in Block 12, which greatly diminishes the prospects of constructing an LNG terminal that requires 5.5 tcf in order to be economically viable.

Moreover, local sources are putting numbers closer to 3 tcf of gas in place, making the whole investment perilous when considering the high depths involved and the capital needed to create necessary infrastructure. Furthermore, the Cypriot government through its energy authorities has made known that a second appraisal drilling will take place, no sooner than March 2014 and it could be delayed up to a year from now."

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