Hydrocarbon Exploration Activities Offshore CyprusHydrocarbon Exploration Activities Offshore Cyprus

Solon KassinisDirector - Energy Service

Ministry of Commerce, Industry & TourismRepublic of Cyprus

Delegation of French Oil & Gas CompaniesNicosia, 05 December 2012

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Block 12 Oct. 2008: Exploration Licence and PSC with Noble Energy International Ltd Sept. 2009: 469 sq km 3D seismic survey (Prospect: Aphrodite) Jun. 2011: 4,000 km 2D seismic survey + Grav & Mag Surveys Sept. 2011: First Exploratory Well Oct. 2011: First Renewal of the Exploration Licence – 25% Relinquishment

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Block 12

Natural Gas Discovery 28 Dec. 2011 7tcf gross mean estimated resources 40 sq. miles field area 5,860m total depth 1,688m water depth

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Next Steps: Appraisal Drilling An appraisal well is planned to be drilled in

Aphrodite field within the first quarter 2013 5,950m total depth 1,730m water depth Preparation of tenders for the appraisal drilling

under progress The whole appraisal process is anticipated to

be completed by early 2015

ENSCO 5006

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Next Steps: Upstream Development

Verification (exploratory) well drilling Reservoir appraisal and assessment Studies on the installation of offshore

and onshore equipment Production drilling and well completion Subsea system installation Deep water host commissioning Export pipeline installation

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Next Steps: Pipelines Studies are underway regarding the pipeline routing from the gas field to Cyprus’ shore Gas Supply from Block 12 via pipeline: 2017-2018 Interim Solution: Proposals for

the transport of natural gas to Cyprus for meeting its domestic demand under evaluation

Subduction Zone

Submerged Canyon Complex

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Next Steps: Downstream Development The political decision for the establishment of an onshore LNG plant has been taken Available land for the construction up to 3 trains (5MT/year each) Additional gas flows from

other upstream fields (EEZ of the Republic of Cyprus and the neighboring countries) will be handled by the plant

It will be the largest investment in the island's history

Indicative timetable for project competition: 2019

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Next Steps: Downstream DevelopmentLNG Export to Regasification Terminals

REPUBLIC OF CYPRUS Energy Service – MCIT

LEGEND

Existing pipeline Planned pipelineTans-Med Gas PipelineCompressor Station

Gas Discovery - Next Steps: Downstream DevelopmentNatural Gas Pipeline: Israel-Cyprus-Greece

REPUBLIC OF CYPRUS Energy Service – MCIT

Gas Discovery - Next Steps: Downstream DevelopmentUndersea Electric Power Line: Israel-Cyprus-Greece

REPUBLIC OF CYPRUS Energy Service – MCIT

Natural Gas Supply to Europe (2011)

LNG Qatar: 43 bcmAlgeria: 13 bcmNigeria: 14.5 bcmEgypt: 4 bcmTrinidad Tobago: 4 bcmNorway: 2.5 bcmSource: BP Statistical Review of World Energy

LNG FlowsPipeline Gas Flows

Pipeline Gas Russia: 115 bcmNorway: 93 bcmAlgeria: 33 bcm

REPUBLIC OF CYPRUS Energy Service – MCIT

Natural Gas Demand in Europe - 2030

Source: Eurostat & Eurogas

Primary Energy Consumption (Μtoe)

Natural Gas Share in EU’s Primary Energy Consumption (%)

REPUBLIC OF CYPRUS Energy Service – MCIT

Natural Gas Demand in Europe - 2030

Source: Eurogas

Necessary Additional Natural Gas Supplies up to 2030

Natural Gas Production within EU declines The share of Natural Gas in EU’s primary energy consumption will remain high i.e. mainly for

power generation purposes The exploitation of shale gas faces environmental challenges

The North East Mediterranean Region could be a new source for Natural Gas Supply to Europe

REPUBLIC OF CYPRUS Energy Service – MCIT

More Gas (Oil?) Discoveries are coming…

2nd Licensing Round: 11 Feb. – 11 May 2012 Available Blocks: 1-11 & 13 Number of Applicants: 15 Companies/Consortia Number of Applications Submitted: 33 Negotiation Phase

Blocks 2 & 3: ENI-KOGAS Block 9: Total-Novatek-GPB Block 11: Total

REPUBLIC OF CYPRUS Energy Service – MCIT

2nd Licensing Round Block 2

Water Depth: 248 - 2,051 m (average 1,575 m) Average Distance from Vasilikos: ~75 km

Block 3 Water Depth: 782 - 2,020 m (average 1,481 m) Average Distance from Vasilikos: ~125 km

Block 9 Water Depth: 1,887 - 2,351 m (average 2,108 m) Average Distance from Vasilikos: ~105 km

Block 11 Water Depth: 1,194 - 2,186 m (average 1,621 m) Average Distance from Vasilikos: ~190 km

Extensive Existing Seismic Data: 2D seismic grid 5x5km 659 sq. km 3D (2007) seismic data in Block 3

Proposed Working Program for Blocks 2, 3, 9 & 11: Extensive 2D & 3D seismic surveys 1 / 2 exploratory wells for the first exploration

phase (3yrs)

REPUBLIC OF CYPRUS Energy Service – MCIT

Cyprus' Energy Profile Will Change Radically… New Exploration Licenses (more hydrocarbon discoveries) Proposals for gas supply as interim solution (2015) Gas Supply to Cyprus via Pipeline Establishment of LNG plant for

gas transport to EU and the International Markets

Other options for gas monetization: • Gas export pipeline• GTL• Petrochemicals

Cyprus can develop the necessary infrastructure for providing services to drilling activities

REPUBLIC OF CYPRUS Energy Service – MCIT

Thank you for your attention!