Cyprus is considering whether to extend next month’s deadline for bids for an oil and gas round to entice more potential investors as it seeks to maximize revenue and bolster finances.
The government is holding an auction for offshore exploration permits covering the south of the island, according to the Cyprus Hydrocarbons State Co., also known as Kretyk. It has already granted licenses for exploratory drilling in six blocks to Noble Energy Inc., Total SA and a joint venture between Eni SpA and Korea Gas Corp.
“The bidding finishes on the 26th of May, though possibly we can extend this period,” Solon Kassinis, vice president of Kretyk, said in a phone interview.
The east Mediterranean island nation says it has gas reserves of as much as 60 trillion cubic feet, equal to about 21 years of U.K. demand. The gas reserves could help the economy recover after Cyprus avoided a sovereign default by accepting a 10 billion-euro ($13 billion) bailout.
“We shall prepare requests for interest to see if we are going to collaborate to materialize LNG,” Kassinis said, referring to plans to export liquefied natural gas. More companies are interested in exploring off Cyprus, he said, without identifying any.
Noble plans to start drilling an appraisal well in June and may announce the commercial viability of their field in block 12 in the Economic Exclusion Zone by the end of the year, Kassinis said. The deposit holds at least 7 trillion cubic feet of gas, which could rise to as much as 10 trillion cubic feet with further exploration, he said.
“Depending on the actions we take and how fast we do it,” Kassinis said, the first LNG could be shipped from Cyprus by 2018.
Total, Eni and Kogas plan to conduct seismic surveys this year and drill their first wells in 2014, Kassinis said. Russia’s OAO Gazprom hasn’t sent Cyprus a proposal to explore for gas in the island’s waters.