Cyprus can have the best of both worlds if it can export compressed natural gas to regional markets and liquefied natural gas to global markets at the same time.
This is what Adam Hedayat, vice-president for the Mediterranean, Middle East and Africa for Canada-based CNG transporter Sea NG Corporation, told The Cyprus Weekly yesterday.
“We are focusing on the interim solution (for Cyprus) and the smaller values, we are complementary to the LNG, we are not in competition. And we believe that Cyprus can have the best of both worlds at the same time, CNG for regional markets and LNG for global markets,” Hedayat said.
“Our proposal is before DEFA (Natural Gas Public Company)… I look at the Cypriot situation from an external point of view, and with the prevailing harsh financial difficulties the government needs to do two things: one is to reduce the cost of imported fuel and the second is to accelerate export revenue. In conjunction with the longer-term plans for LNG exports,” he added.
Hedayat said that with gas from Israel and their own flexible pipeline Cyprus can have gas within 24 months only - provided all agreements are signed.
The Sea NG alliance has strong financial and operational capability – over 110 billion in assets, added the electrical engineer.
However, DEFA is now evaluating an interim supply competition bid by ITERA International Group of Companies – one of the largest independent producers and traders of natural gas operating in the CIS and the Baltic states.
Insiders in Nicosia have said that only if this bid is considered too expensive will the state consider alternatives.
Houston-based Noble Energy which discovered Cyprus’ natural gas deposits in 2011 has also made an ‘informal interim proposal’ to the government involving the deployment of a spar platform.
A spar platform can drill and produce natural gas from a well faster than conventional drilling rigs and Noble could feed Vassilikos power plant as early as January 2016.
Last month, Cyprus signed a Memorandum of Understanding with Noble Energy, Delek Drilling and Avner Oil Exploration regarding the development of an LNG terminal at Vasilikos. Nicosia aims to begin LNG exports in 2020.
Hedayat said that if an interim CNG solution is implemented, benefits would be immediate with a reduction in national energy import bill of over €100 million per year.
In addition, there would be a potential reduction in cost electricity of over 10% for households.
And cleaner gas could eliminate an EU-required carbon-credit purchase programme.