Energy ministry to revise hydrocarbon contracts offered

The environment and energy ministry has decided to begin a process leading to revisions of a standard contract offered for hydrocarbon exploration and exploitation.

Revisions are expected to be made to an existing contract blueprint providing lease and tax revenues for the Greek State. This model is applied in most European countries and was introduced by local authorities for Greece in 2011. The blueprint was used for a tender offering 20 offshore blocks, a procedure that drew bids for three of these blocks (ELPE, Energean); three onshore blocks (also ELPE and Energean); as well as an open-door procedure. The experience gained from this activity as well as international industry trends will be utilized to improve the contract blueprint.

The ministry also plans to create a new contract blueprint, also applied internationally, which is based on distribution of production. This model was one of the election campaign policies trumpeted by Syriza prior to its election victory in 2015.

The revision process is expected to begin soon but it remains unknown how swiftly it can be completed.

Energy ministry officials are maintaining regular contact with Cypriot authorities who have already adopted a model Greece is interested in implementing.

“The main thing is to assess the obligations each model creates for the Greek State and whether these can be covered by existing structures,” a well-informed authority told energypress.