ExxonMobil, QatarEnergy declare Cyprus gas marketable in deal with Nicosia

Exxon Mobil

Yesterday 11:35

    NICOSIA, June 30 (Reuters) - Energy conglomerates ExxonMobil XOM.N and QatarEnergy signed a deal with Cyprus on Tuesday declaring prospects in two offshore gas fields marketable, a milestone in efforts by the east Mediterranean island to develop offshore gas reserves.
The Declaration of Marketability signed in Nicosia advances a project central to the region's ambitions to supply more gas to Europe. 
ExxonMobil has reported discoveries in two offshore blocks in fields known as Glaucus and Pegasus. 
Cypriot officials say the combined discoveries could be between 8 and 9 trillion cubic feet.
The deal signed on Tuesday "represents a major step towards establishing the Eastern Mediterranean as a credible alternative energy corridor for Europe", Cyprus President Nikos Christodoulides said in Nicosia alongside representatives of ExxonMobil and QatarEnergy.
Some additional drilling on the two offshore fields would be required before moving into the front-end engineering and design (FEED), officials say.
A final investment decision is anticipated around 2029 and production in 2033, said ExxonMobil Vice President and head of global expansion John Ardill. 
QatarEnergy signed a preliminary deal with ExxonMobil and Egypt's government in May to study the development and commercialisation of gas discoveries in Cyprus using Egypt's existing gas and LNG infrastructure. 
The reserves from Pegasus and Glaucus would probably be delivered with a pipeline tie-back to Egypt, Ardill said.
Tie-backs to underutilised infrastructure in Egypt are also being considered for other Cypriot discoveries; approximately 3.5-4.5 tcf in Aphrodite, licenced to Chevron CVX.N, and the more than 3 tcf Cronos discovery licenced to Italy's Eni ENI.MI with France's Total TTEF.PA. 
     

 (Writing by Michele Kambas; Editing by Emelia Sithole-Matarise)