Cyprus to Move Forward with More Oil Drilling Licensing

Cyprus will move ahead with further licensing for oil drilling after analyzing the results of its most recent exploration, the country's energy minister Yiorgos Lakkotrypis said on Wednesday.

 

Cyprus announced the completion of a third round of licensing for well drilling in which Exxon Mobil (XOM), Italy’s ENI and France’s Total won additional blocks offshore. The contracts will be signed on April 5 and 6, but it has not yet been determined which blocks off Cyprus' coast the companies will drill, Lakkotrypis said.

 

The minister said that while the country's current priority is "exploration, exploration, exploration," he expected much more for Cyprus on the energy front.

 

"Once we have the results of this exploration 2.0 as I called it, then of course there will be a fourth (round) and a fifth and a sixth and I’m sure there will be plenty more," Lakkotrypis told Reuters on the sidelines of Capital Link's Invest in Cyprus Forum in New York City.

 

Additionally, ENI and Total will have additional wells on the already licensed block with ENI expected to begin work in late June or early July. ENI will also progress with "a couple" of wells this year, Lakkotrypis said. Exxon will be developing its well in 2018 with a number of exploration wells to take place in the coming years.

 

Cyprus is seeking to develop its energy sector to bolster an economy that relies largely on tourism, business services and shipping. However efforts to expand the energy sector could be complicated by the island's division between Turkish Cypriots and Greek Cypriots.

 

Turkey, which supports a breakaway Turkish Cypriot state in northern Cyprus and is highly influential there, says the Greek Cypriot-led government of the island has no right to explore for hydrocarbons.

 

Cyprus and Turkey do not have diplomatic relations and peace talks between Greek and Turkish Cypriots to reunite the island under a federal umbrella broke off abruptly in February.

 

Lakkotrypis said the government was committed to negotiating an agreement with Turkey but that its oil and gas development was not part of that discussion.

 

"Cyprus is a sovereign country," he said. "We will continue to go ahead and proceed with strategic plans in the oil and gas industry to develop the industry with the help of some of the biggest companies in the world."


(Reporting by Dion Rabouin,; Additional reporting by Michele Kambas in Cyprus; Editing by Andrew Ha