Petroleum Minister Tarek al-Molla - Reuters
CAIRO – 24 August 2018: Cyprus’s cabinet formed a committee to renegotiate the recent gas agreement with Egypt for the 4.5 trillion cubic feet Aphrodite gas field according to the new energy prices.
Aphrodite lies in block 12 of Cyprus’s exclusive economic zone and it is Cyprus’s first gas finding, discovered in 2011.
At the end of last year, a consortium including Texas-based Noble Energy Inc., Israel’s Delek and Shell, which operates an LNG terminal in Egypt, had reached a preliminary agreement to sell Aphrodite’s gas through Egypt.
Egypt currently has two liquefied natural gas (LNG) facilities in both Edco and Damietta. Such facilities could be used to export Cypriot gas to foreign markets.
The consortium said that because of the low international price of oil, the project would not be viable and they had asked for a review of the financial conditions in the existing agreement.
“From then on the progress of the negotiations will define the course of the talks,” Cyprus Energy Minister Yiorgos Lakkotrypis said. “If all goes as planned, natural gas will start flowing to Egypt in 2022,” he added.
The gas will be used for domestic purposes or possible be re-exported.
International oil prices fell to below $40 from over $100 per barrel four years ago. Currently, Brent Oil is traded at around $70.
Egypt has rapidly increased its production of natural gas and hopes to become a hub for exporting to Europe after making a series of big discoveries in recent years. Egypt aims to halt gas imports by 2019 and achieve self-sufficiency.