Cyprus to earn $400-500 bln from natural gas

* Strategic opportunity for LNG trains to Europe, replace Nabucco *

The natural gas under the seabed of Cyprus could amount to $400-500 bln influx to the Cyprus economy over the next couple of decades, explained Dr. Michael Economides, a leading expert on energy geopolitics, adding that the financial impact could be in excess of a trillion dollars if the multiplier effect onto the local economy was taken into account.

Economides gave a lecture at the University of Cyprus on “Eastern Mediterranean Natural Gas: A geopolitical game changer”, hosted by the Cyprus District 27 of AHEPA, the largest Greek-American association in the world.
According to Economides, Israel’s and Cyprus’ successes in the energy arena are a game-changer in regional geopolitics. The two countries have cooperated and defined the borders of the continental shelf and natural gas may bring Israel and Cyprus (and by extension Greece) into a natural alliance.

“The situation creates a new reality in the area, perhaps as important as the Arab Spring,” Economides said.
He added that in line with the U.S. Geological Survey, the size of the ultimate recoverable natural gas in the Eastern Mediterranean is 200 trln cubic feet (Tcf) of natural gas and 3.7 bln barrels of oil. Israel has already booked about 50 Tcf and a dozen new Cypriot blocks, currently in the process of being offered to international bidders, will add 50 Tcf, perhaps 75 Tcf to what has already been discovered.

Economides added that Cyprus could become the vehicle for liquefied natural gas (LNG) liquefaction and then export LNG to a natural gas starving Europe, suffocated by Russian natural gas imports. An alternative and substantial source of natural gas to Europe could provide what the ill-fated Nabucco pipeline is unlikely to ever deliver. Three LNG trains to be constructed on Cyprus can export 20 mln metric tons of LNG per year (MTPA) amounting to about 33% of Russian exports to Western Europe, which were 3.3 Tcf in 2009.

The audience included the Rector of the University of Cyprus, Constantinos Christofides, and Cyprus Energy Chief Solon Kassinis.

Dr. Economides is a professor at the Cullen College of Engineering, University of Houston and Managing Partner of Dr. Michael J. Economides Consultants, Inc. He is the Editor-in-Chief of Energy Tribune and Editor-in-Chief of the peer-reviewed Journal of Natural Gas Science and Engineering.

He has served as Senior Technical Advisor to China’s CNOOC and subsidiary COSL, to China’s Sinopec on gas exploitation, including shale, to ENI, Italy’s main petroleum multinational company and for more than five years to Yukos and Sibneft, Russia’s major petroleum companies.

PHOTO: From left, Periklis Theodoridis (AHEPA Cyprus District Secretary), Dr Michael Economides, Phanos Pitiris (AHEPA Cyprus District Governor), John Georgoulas (Vice President AHEPA ACY001).