* Cyprus eyes regional role for east Med gas
* LNG terminal deal seen by year-end
* Cyprus hopes to start exports by 2020
By Michele Kambas
NICOSIA, June 26 Aiming for energy hub status
and hoping to reboot an economy hobbled by a debt bailout -
Cyprus started talks with three energy firms for the development
of a liquefied natural gas (LNG) terminal.
The terminal, with an estimated cost of $6 billion, will
process the vast natural gas reserves off the east Mediterranean
island. Based on its current timeframe, Cyprus hopes to start
exports by 2020.
"Completion of this project is an important step towards the
realisation of our energy strategy, with the ultimate objective
the establishment of Cyprus as a regional energy hub," Energy
Minister Yiorgos Lakkotrypis said at a ceremony on Wednesday
where a project memorandum of understanding was signed.
Cyprus discovered an average 7 trillion cubic feet of
natural gas in Dec. 2011 in one field offshore, close to where
Israel reported major finds within its own maritime boundaries.
U.S. company Noble Energy and Israeli companies Delek
Drilling and Avner Oil Exploration, which
are the dominant players in both the Cypriot and Israeli
projects, will over the next six months discuss the technical
and commercial details of any eventual deal on an LNG terminal.
The sides hope to conclude talks by Dec. 31.
Noble launched an appraisal drilling on its Cypriot offshore
find last month, while Total and ENI are
poised to launch exploratory drills elsewhere off Cyprus by
Facing an unprecedented austerity-driven recession and
record unemployment at 15.6 percent, the island is clinging to
the hope gas discoveries will bring in badly needed revenue and
create jobs. Cyprus receieved a 10 billion euro ($13 billion)
international bailout in March.
Lakkotrypis said there were "multiple ways" to finance the
LNG project, including with equity or debt, but declined to go
into further detail.
Cyprus is marketing the venture to Israeld which has also
reported natural gas finds, and to Lebanon. Israel's government
decided on Sunday that it could export about 40 percent of its
Gideon Tadmor, Avner's CEO and chairman of Delek, said the
idea of using the Cypriot LNG terminal to process Israeli gas
should be explored.
"It is a possibility and opportunity we intend to
investigate," he told reporters.
Israel's government decided on Sunday that it could export
about 40 percent of its newly-discovered reserves.