On the sidelines of the Greece, Cyprus, Israel tripartite meeting in Thessaloniki, Yiorgos Lakkotrypis, Minister of Energy, Commerce, Industry & Tourism for the Republic of Cyprus, in an interview with IBNA stated that one of the top priorities in terms of implementation of the East Med project was at “what price gas will be transported to Europe after the pipeline is completed”.
Read the full interview below
The tripartite meeting between Greece, Cyprus and Israel took place today. As Minister of Energy of the Republic of Cyprus, how do you see the East Med developing?
Today, the main issue on the energy agenda at the tripartite meeting was of course the East Med but also the Interconnect cable. On the East Med we agreed that a joint declaration will be issued, in order to support the project and try to acquire the necessary European Union funding for it. Funding for the detailed technical studies, what we call FEED (Front End Engineering & Design) which will result in finalising every last detail, both technical details and the financial viability of the project. One of the key questions was at what price will gas be transported to Europe after the pipeline is complete. It is one of our top priorities in terms of the implementation of the project. That is why the next step is to support the implementing body to obtain EU funding for the detailed technical studies.
Is there a timeframe for the implementation of the project?
It is still early. I understand that in September there will be an invitation for expression of interest to fund such projects. Allow me to explain that what has been funded so far were the pre-FEED studies. FEED will cost much more and we will request the support of the EU to assist the implementation body. In September, at the end of the year, decisions will be made for the implementation to proceed, deep sea studies to proceed and everything else.
So, there is no issue with the implementation of the project…
No. At this stage there is no issue because the project is following the normal order of things. That is, pre-FEED, FEED, and if everything is goes ell and there are technical agreements already signed then we will proceed to the final investment decision. The project follows its normal course. Following the EU’s presence, as you saw in Tel Aviv last April in the quadripartite meeting with the Commissioner. As you will see in the declaration signed earlier, the next meeting will be in Cyprus around the end of 2017.
Before the end of 2017 new efforts for exploration in the Cypriot EEZ will take place. Is there an issue with Turkey and its attempts to block it?
Turkey has an issue. For us, of course, the serious violations of the sovereign rights of the Republic of Cyprus, as they are expressed and we see them on a daily basis, are serious but they make us even more determined to proceed to exercise this indisputable right and to proceed to drilling next July and then the drilling that is currently being planned. However the blocks and dates have not yet been specified by the companies.
On 28 June negotiations in Geneva restart. Will this be a problem for the exploration in the Cypriot EEZ?
We have been clear thus far and we will continue to be clear. Negotiations on the Cyprus issue are not linked with our strategy, planning or actions for hydrocarbons. When we launched the third licensing round, the talks were running. When we concluded the 3rd round of bidding and signed off on it, the same. The same is true now. These are two different things.
How is cooperation with Egypt including trilateral cooperation developing? There were positive developments and progress in the last meeting.
The most important thing, as far as energy is concerned at least, since the relationship is on multiple levels, is the focus on commercial agreements which are currently being negotiated between the Aphrodite companies, plus of course the Republic of Cyprus which is being represented by the Hydrocarbons Company of Cyprus on the one hand, and on the other hand the Egyptian firms that could acquire the natural gas of Aphrodite. In order to proceed with the development of the field, I believe it is most important that it is done through a direct pipeline from the Cypriot EEZ to the Egyptian shores. We are at an advanced stage in these negotiations, with the price of oil in the market making them difficult and the project marginal, but we see that companies are finding innovative ways either to reduce development costs or to try to achieve a better price. It is at an advanced stage. We hope for the best results soon.
Has the recent crisis in Qatar affected research and investment in the energy sector in Cyprus, Israel, Egypt and Greece?
As you know, the 10th field is licensed to the Exxon – Qatar Petroleum consortium, a 60-40 joint venture, with Exxon being the operator. Beyond that, it is too early to be able to draw conclusions whether it will affect the energy sector in Cyprus or, more generally, whether it will affect the energy industry. As you know, Qatar is the largest exporter of liquefied natural gas right now and we need to see what will happen there. We are watching it closely, but it is too early to come to a conclusion.
How is cooperation with Lebanon developing following the first trilateral meeting held between the foreign ministers?
We actually concluded a three-day official visit by the President of the Republic of Cyprus to Lebanon. For us it is a neighbouring country that we want to engage with in the energy sector. Especially because it is currently launching its first round that will end in September 2017. So, it was important to begin talks with Lebanon because it was a country that had been missing from the puzzle in this region so far, and the President has proposed to start this debate in a tripartite format beyond bilateral relations, i.e. between Cyprus, Greece and Lebanon./IBNA