Cyprus and Chevron-led group extend gas field talks

Reuters/Esam Omran Al-Fetori

Cyprus and international energy companies led by Chevron have agreed to extend talks on how to develop its Aphrodite offshore gas field amid progress in negotiations, its energy minister said on Friday.

“It is not a new negotiating round, it’s an extension, because there is progress in the conversation,” energy minister George Papanastasiou told Reuters, confirming a report in the authoritative Middle East Economic Survey journal that talks would be extended to November 5.

To avoid “working against the clock” in the negotiation, he said, “we extended it”. “It was a mutual extension, the contract allowed any extra extension so this is what we did,” he said.

“We believe that by November 5, we will arrive to an agreement,” he added.

Chevron did not immediately respond to a request for comment.

Nicosia disagreed with modifications proposed by Chevron and its partners earlier this year to a 2019 agreement to develop the estimated 3.5 trillion cubic foot gas field, particularly a proposal to remove what Cyprus considers essential processing infrastructure on the sea surface.

The modifications removed a floating gas processing plant, which Nicosia believes is necessary in its exclusive economic zone, and cut the number of production wells to three from an initial five.

Chevron is a partner in the field with Israel’s NewMed and Shell.

The US is backing Chevron’s plans, which it believes will help get gas to the market faster and does not involve building large infrastructure, Reuters reported this month.

The overall objective of the project, which remains unchanged, is to connect Aphrodite via a subsea pipeline to Egypt, where the gas can be sold in the domestic market or liquefied and shipped to Europe, which has been largely cut off from Russian supplies.