Cyprus, Egypt sign framework agreement for transfer of gas to Egypt

Cyprus and Egypt on Wednesday signed a framework agreement for the transfer of natural gas from a Cypriot field via pipe to Egypt's liquefaction terminals.

The gas field, about 85 km off Cyprus' southern shores, is managed by Texas-based Noble Energy. It is estimated to contain 4.5 trillion cubic feet of natural gas.

The agreement was signed at the Cypriot Ministry of Energy in Nicosia by visiting Egyptian Petroleum Minister Tarek El Molla and Cypriot Commerce and Energy Minister Yiorgos Lakkotrypis.

They said in a joint statement that the deal provides for the construction of a pipe from the Aphrodite field in Cyprus's exclusive economic zone to either Egypt's shores or to an existing pipe system which was used for the transfer of Egyptian gas to two terminals at Idku and Damietta.

The agreement allows Egypt to use gas for domestic consumption or re-export.

The actual transfer of Cypriot gas to Egypt would require further commercial agreements between private companies for the construction of the pipe system and the sale of the gas.

"In essence, today we signed an agreement which stipulates that the two countries will respect the provisions of any trade agreements that may take place," Lakkotrypis said.

"We hope that this agreement will facilitate and expedite trade agreement, creating a secure investment framework for the sale of natural gas from Cyprus to Egypt," he added.

Though Egypt has discovered a mammoth gas file called Zohr next to Cyprus' EEZ blocks recently licensed for gas exploration to international energy companies, it has said that it could buy as much gas as Cyprus could allocate.

The Egyptian minister said the current planning is part of the development of the east Mediterranean gas as a whole.

"Our strategy is optimally to position ourselves as an energy hub in the region," El Molla said referring to an agreement locking into cooperation between Cyprus, Greece and Egypt.

Cyprus is about to announce new licensing for gas exploration to energy companies, including Italian ENI, French Total, Norwegian Statoil and Exon Mobil in association with Qatar Petroleum.

This will be additional to licenses already awarded for other offshore blocks to ENI in association with South Korean KOGAS and Total.

Source : XINHUA