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Noble Announces Natural-Gas Discovery Off Coast of Cyprus

29 December 2011 10:47 (UTC +04:00)

Baku - APA-Economics. Noble Energy Inc.â€™s plans to develop as much as 8 trillion cubic feet of natural gas off the coast of Cyprus may be complicated by a dispute with Turkey over development of the field, BusinessWeek reported.

The discovery may hold 5 trillion to 8 trillion cubic feet of gas, Houston-based Noble Energy said in a statement today. The field, which lies in the Mediterranean Sea between Cyprus and Israel, covers 40 square miles (100 square kilometers) and requires more appraisal before development, the company said.

Turkey doesnâ€™t recognize the Greek Cypriot government and in September it sent an exploration vessel accompanied by warships and fighter jets to the area after Noble started drilling. Cyprus is divided after Turkey invaded the northern third of the island in 1974. Development projects should await resolution of the islandâ€™s political status, Turkey has said.

â€œThe politics are going to get more and more complicated as you get closer to development,â€ said John Malone, an analyst at Global Hunter Securities LLC in New York.

United Nations Secretary-General Ban Ki-Moon summoned Cyprus President Demetris Christofias and Dervish Eroglu, the leader of the Turkish Cypriot community, to New York for a new round of talks in January to reunify the island.

The discovery is in his nationâ€™s â€œexclusive economic zone,â€ Christofias said at a press conference in Nicosia today. â€œCyprus is coming into Europeâ€™s energy map with prospects of substantially contributing to the EUâ€™s energy security.â€

The U.S. Geological survey estimates that the Levant Basin, a triangular slice of the Mediterranean lying between Cyprus and Israel, may hold 122 trillion cubic feet of gas. Noble Energy discovered about 9 trillion cubic feet of gas at the Tamar field in 2009 and as much as 20 trillion cubic feet at the Leviathan field in 2010, both off the Israeli coast.

The Cyprus field is the first discovered off the nationâ€™s coast. At current gas prices of about $4 per million British thermal units, the find would be worth $32 billion, said Constantinos Hadjitassou, energy researcher at the University of Cyprus.

Noble Energy operates the Cyprus well and owns a 70 percent share. Delek Drilling-LP and Avner Oil Exploration LLP each hold a 15 percent stake, it said.

Noble Energy fell 1.7 percent to $94.02 at the close in New York. Expectations for the Cyprus field were high, Michael Hall, an analyst at Robert W. Baird & Co., wrote in a note to clients, and â€œwere recently increased following the upgrade of Leviathan potential and rumors that Cyprus could represent Nobleâ€™s largest eastern Mediterranean prospect.â€