[NGW Magazine] Cyprus pins hopes on mini-Zohr

A new gas find by Eni, not far from the Zohr field offshore Egypt, has inevitably excited the government of Cyprus, where Calypso lies. LNG imports will still be needed in the short term – but thereafter... ?

Italian Eni gave the island of Cyprus hope that it too can share in some of the riches just across the boundary in Egypt's waters when it announced February 8 a new, significant, natural gas discovery with a rig it was operating.

In a cautiously-worded statement the company said it made a lean gas discovery in Block 6 Offshore Cyprus with Calypso 1 (Figure 1). The well, which was drilled in 2,074 metres of water depth reaching a final total depth of 3,827 metres, encountered an extended   gas column in rocks of Miocene and Cretaceous age. The Cretaceous sequence has excellent reservoir characteristics, it said.

Figure 1: Licensed blocks in Cyprus EEZ

Source: MCIT Cyprus

An intensive and detailed data collection (fluids and rock samples) has been executed on the well. Calypso 1 is a promising gas discovery and confirms the extension of the ‘Zohr-like’ play in the Cyprus Exclusive Economic Zone (EEZ), Eni said, and additional studies will be carried out to assess the range of the gas volumes in place and define further exploration and appraisal operations. Eni and French Total each have half the block.

Eni has been present in Cyprus since 2013 and has interests in six licences in the EEZ of Cyprus (in Blocks 2, 3, 6, 8, 9 and 11), five of which are operated. 

On the same day Cyprus’ energy minister Yiorgos Lakkotropis, while presenting the results from drilling Block 6, said that extensive quantities of natural gas have been discovered. The reservoir, he said, is of "excellent quality."

He stressed that this discovery is particularly important as it increases the gas reserves in Cyprus, confirming that there is a complete geological association between Calypso 1 and Zohr, although it was too early to assess the size of the find. 

Detailed geophysical and geological studies and further research and evaluation work are required. 

But in any event, he pointed out: "What is important is that we have a natural gas discovery and we need more time to declare the quantities…This is a particularly positive development, on the one hand, increasing the endogenous natural gas reserves and reaffirming the existence of a petroleum system as well as a hydrocarbon reservoir within of the Cypriot EEZ, similar to the Egyptian Zohr deposit."

An exuberant Cyprus press is already referring to this new discovery as a ‘small Zohr’, claiming that it extends over an area about 35% of Zohr, which covers an area about 100 km². 

However, the minister is now trying to tone it down, by highlighting that peculiarities of the geology make speculation pointless. He said the possible range is wide, with the lower estimate being low. Results are expected to be announced during the next few weeks.

This is reflected is subsequent press coverage that ‘the significance of the discovery in Calypso appears to be much greater than the actual quantity of gas because it places Cyprus firmly on the global and European gas map’. 

Calypso 1 lies at the south-east corner of Block 6 and early indications, based on seismic data, are that the reservoir may be expending into the adjacent blocks, 7, 10 and 11.

Lakkotrypis confirmed that the drillrig, Saipem 12000 (Figure 2), is on the way to Block 3, to drill the next target, dubbed Cuttlefish. Drilling is expected to start end of this week. Block 3 is owned 80% by Eni and 20% by Kogas. 

Figure 2: Drillship SAIPEM 12000

 Source: SAIPEM

Expectations are for a moderate size find, but because Cuttlefish is closer to Cyprus coast, about 80 km offshore and in shallower water and target depth, the cost of production and transportation of any natural gas find to Cyprus could be very competitive. This opens up serious opportunities for the transportation of such gas to Cyprus for power generation.

The current exploration campaign will be completed with ExxonMobil’s much awaited drilling in Block 10, during the second half of 2018. Lakkotrypis said that the first drilling target in block 10 has already been fixed under the name ‘Delphinus’. A second target named ‘Anthea’ is at the stage of final definition.

In the meanwhile, Turkey is maintaining pressure by declaring a new Navtex (notice to mariners), blocking an area south-east of Cyprus and within Block 3, including the area of the Cuttlefish target. The Cypriot authorities said they are watching developments but are not worried. In fact, Cyprus has issued its own Navtex providing protection of drilling activities, extending from Limassol to Block 3 and Cuttlefish.

Turkey's sensitivity to Eni’s activities in Cyprus’ EEZ was conveyed by its president Tayyip Erdogan, who informed the Italian government during his visit there in early February. He said: "We have pointed out to them that the actions of Eni in drilling for ​​natural gas in that area involve a risk for northern Cyprus and for us."

Concerned about such developments, Egypt warned Turkey February 7 against any infringement of its economic rights in the eastern Mediterranean under the maritime border demarcation agreement signed in 2013 with Cyprus that allows exploration for hydrocarbons in the area. 

In the meanwhile, Cyprus is carrying on with its plans with the full support of Eni, Total and ExxonMobil and their governments.

Charles Ellinas