Negotiations between the Cypriot and Israeli government over the rights to natural gas under the seabed in the eastern Mediterranean have reached a “very advanced stage”, Energy Minister Michael Damianos said on Tuesday.
He said that a “very good meeting” on the matter had been held on Monday, “where important commercial terms were agreed upon”, but that “some legal matters remain”.
As such, he added, “we are moving forward by closing several of the pending issues”, with it hoped that those issues will be “closed” within “the next period of time”.
The disagreement stems from the Aphrodite gas field, located in Block 12 of Cyprus’ exclusive economic zone (EEZ).
Block 12 is located at the southernmost tip of Cyprus’ EEZ and borders the Israeli EEZ to its southeast. The Aphrodite field is located in the east of that block.
For years, Israel has argued that part of the gas in Aphrodite comes from a neighbouring field in Israel’s EEZ called Yishai, with some estimates stating that up to 10 per cent of the field could be Israeli, meaning that over €1 billion could be at stake.
Damianos’ predecessor George Papanastasiou had said as early as January last year that negotiations had “entered their final stage”, and that he expected an agreement to be reached by the end of April last year.
“Our aim is to visit the neighbouring country to reach a conclusion and sign it,” he said at the time.
However, various geopolitical developments in the region, including last summer’s 12-day conflict between Israel and Iran, and this spring’s war involving Israel, Iran and the United States, diverted attention away from the dispute between Cyprus and Israel over natural gas.
Damianos on Tuesday said that following on from an agreement with Israel, the government expects the American multinational corporation Chevron, Israeli energy company NewMed Energy, and BG Group, owned by Royal Dutch Shell, consortium to sign a final investment decision regarding Block 12 next year.
Seabed surveys to find a sinking point for the pipeline which will take natural gas from Cyprus’ EEZ to Egypt for liquefaction began in June last year, with the initial aim being for natural gas from the Aphrodite field to be taken the Segas liquefied natural gas (LNG) terminal in the Egyptian port city of Damietta.
