Israel’s Delek Drilling in Negotiations with Cyprus for LNG Terminal

Cyprus is negotiating with Israel’s Delek Drilling to develop a liquefied natural gas (LNG) terminal by 2020 to tap the East Mediterranean’s natural gas and serve buyers in Europe and Asia, writes Reuters on Wednesday.

"Delek confirmed strong interest in our plans and that they are very interested to invest in our export facility," said Charles Ellinas, chief executive of the state-owned Cyprus National Hydrocarbon Company (CNHC).

Delek and subsidiary Avner Oil exploration hold a 30% stake in Block 12 (also known as Aphrodite) which is located offshore Cyprus and is estimated to contain between 5 and 8 trillion cubic feet (tcf) of gas. Noble Energy operates Block 12 with a 70% interest.

Noble Energy is already supporting the LNG project in Cyprus. According to Ellinas, CNHC will be entering into a LNG Project Agreement with Noble Energy.

“Such a joint venture will have three main components: shared facilities, an LNG train and marketing and sales. It will be designed to accommodate other players as we expand the facility to accept more gas and more trains,” said recently Ellinas to Natural Gas Europe.

Cyprus is currently in the early stages of planning the construction of a terminal that would allow Cyprus to export its gas. Technip, a French company specialized in the building and operating of natural gas and oil terminals, conducted a study on behalf of Noble for the construction and operation of the LNG terminal in Cyprus. The results of the study, shared with Cyprus National Hydrocarbons Company (CNHC), confirmed Noble’s wish to accelerate the process of building the LNG terminal before a possible drop in the price of LNG.