East Med

Serbia discussed as Italy alternative for East Med project

Posted on by admin

An alternative route, replacing Italy with Serbia, for the ambitious 5 billion-euro East Med natural gas pipeline, planned to carry southeast Mediterranean natural gas deposits to the EU via Greece, was discussed at a five-way meeting in Thessaloniki last Friday between leading energy-sector officials representing Greece, Israel, Bulgaria, Serbia and the US.

The meeting’s participants expressed concern over the new Italian coalition’s unfavorable view of such projects. In June, the Italian coalition described as “pointless” the Trans Adriatic Pipeline (TAP) project, the final stage of a bigger project – the Southern Gas Corridor – that will take Azeri gas to western Europe. Intended to diversify Europe’s natural gas sources and lessen the reliance on Russia, the TAP project represents the cornerstone of the EU’s energy security policy.

An extremely complex 1,900-km project whose greatest part would run underwater, East Med is planned to conclude in Italy. It is being supported by the EU as a PCI- status project.

Serbia’s mining and energy minister Aleksandar Antic, one of the five participants at the Thessaloniki meeting, held within the framework of the Thessaloniki International Trade Fair, is believed to have embraced the plan for an alternative East Med route that would include his country – should Italy not clarify its position.

 

Israeli gas grid operator considering East Med entry

Posted on by admin

The participation of Israel’s natural gas grid operator, the Natural Gas Lines Company, in the development of the East Med pipeline, planned to carry southeast Mediterranean natural gas deposits along a route stretching from Israel to Europe, is being examined by the Israeli government, energy minister Yuval Steinitz has revealed.

Established in 2003, the Israeli gas grid operator, wholly owned by the Israeli State, holds a 30-year license for development and management of the country’s natural gas network.

In comments offered to Israeli financial daily Globes, Steinitz, highlighting the important role played by the Natural Gas Lines Company in the domestic natural gas market’s growth, noted that the participation of a state-controlled Israeli firm in the East Med pipeline project would offer further impetus to its development.

The prospective pipeline has already received political support from the governments of Greece, Cyprus, Israel and Italy, as was made clear at a four-way meeting in December, staged for the signing of a Memorandum of Understanding.

The Globes article on the East Med project made reference to the gas pipeline’s technical challenges, which exist mainly because of the deep seas between Cyprus and Crete, an area where waters run close to 3.3 kilometers deep.

Subdued natural gas prices at present have also raised questions about the project’s feasibility. The price gap between regional and European markets will need to be between 1 and 2 dollars per mmBtu, currently not the case, if East Med’s feasibility is to be ensured.

However, this could change with the involvement of Greek firm Energean Oil & Gas, now a player in Israel’s Exclusive Economic Zone (EEZ) with licenses to the Karish and Tanin Fields, offshore Israel. Energean recently acquired further hydrocarbon exploration rights in another Israeli tender.

Less than two months ago, Energean Oil & Gas signed a series of natural gas sales agreements with Israeli gas retailers, offering price levels of less than 4 dollars per mmBtu, well below the price of Russian gas being sold to Europe, ranging between 6 and 7 dollars per mmBtu. This discrepancy is good news for the East Med pipeline’s prospects. Other players may follow Energean with similar price levels.

Utilization of recently discovered natural gas deposits in the wider area, such as Cyprus’s “Aphrodite” gas field and the Israeli-controlled block “Leviathan”, is in jeopardy as a result of the inability, so far, of governments and energy companies to establish export solutions.

 

 

 

East Med natural gas pipeline MoU to be signed in Nicosia today

Posted on by admin

Greece’s energy minister Giorgos Stathakis is in Nicosia today for a four-way Greek, Cypriot, Israeli and Italian meeting, along with EU participation, at which a Memorandum of Understanding for the East Med natural gas pipeline project is expected to be signed.

The prospective pipeline project is planned to carry southeast Mediterranean natural gas deposits along a route stretching from Israel to Europe.

Rejuvenated interest expressed by Italian officials in East Med has bolstered the ambitious project’s development prospects and prompted European Commission support for the project.

Preliminary studies co-financed by the EU have determined the project is technically feasible, financially sustainable and commercially competitive.

Its annual transmission capacity is planned to measure 10 billion cubic meters. The pipeline will be designed to enable a capacity increase to 16 billion cubic meters if needed. The project’s cost is estimated at 6 billion euros. Studies conducted to date indicate the project could be completed by 2025.

Following up on today’s MoU, technical teams representing Greece, Cyprus, Israel and Italy are scheduled to meet on December 21 to sign a finalized agreement.

Then, the leaders of Greece, Cyprus and Israel plan to stage a three-way meeting in Nicosia on January 8.

An article published by the Jerusalem Post to coincide with today’s four-way meeting presented the Greek-Cypriot-Israeli energy collaboration as part of a “series strategic interests” as well as an effort by the three countries to “restrict the Russia-Iran-Hezbollah axis in the region.”

This description has raised eyebrows and further complicates any attempt to determine hydrocarbon trends in the southeast Mediterranean, highly significant both geopolitically and geoeconomically.

 

 

Cyprus taking on East Med investment, operational costs

Posted on by admin

Cyprus willl take on investment and operational costs that may arise for East Med, a prospective pipeline to carry southeast Mediterranean natural gas deposits along a route stretching from Israel to Europe, RAE, Greece’s Regulatory Authority for Energy, and RAEK, its Cypriot counterpart, have agreed.

Both authorities also agreed that the division of the project’s overall cost is substantiated, making conditions mature for the project’s development to commence.

IGI Poseidon, a 50-50 joint venture comprised of DEPA, Greece’s Public Gas Corporation, and Italy’s Edison, is promoting the East Med pipeline.

At present, preliminary deep-sea survey work is being planned around Cyprus and Crete to determine the pipeline’s route.

Then, the next step, scheduled for December, will entail a four-way meeting to bring together the energy ministers of Greece, Cyprus, Israel and Italy for the signing of a Memorandum of Understanding.

The East Med pipeline is planned to cover about 1,900 kilometers and connect east Mediterranean deposits with western Greece via Cyprus, Crete and the Peloponnese.

Its annual transmission capacity is planned to measure 10 billion cubic meters. The pipeline will be designed to enable a capacity increase to 16 billion cubic meters if needed. Studies conducted so far indicate the project’s construction cost could reach 6 billion euros.

Officials plan to utilize prospective interconnections towards Bulgaria (IGB), Albania (IAP) and Italy (ITGI).

East Med was classified as a Project of Common Interest (PCI) by the EU in 2013, a decision that facilitates EU funding, while an EU-financed feasibility study was completed last year.

 

 

 

 

Four-way East Med agreement set to be signed tomorrow

Posted on by admin

Greek, Italian, Cypriot and Israeli officials are scheduled to sign a Memorandum of Cooperation in Rome tomorrow as a further step in the long road leading to the development of East Med, a 6.2 billion-euro project designed to transmit natural gas along a route stretching from Israel to Europe.

Greece will be represented by the energy ministry’s secretary general Mihalis Veriopoulos at the meeting, to be staged as a prelude to an Intergovernmental Agreement for the pipeline project expected to be signed in Cyprus at the end of this year. The Cyprus agreement, which will also include Italian representation, will be a crucial step for the project’s investment prospects.

In the lead up to tomorrow’s  memorandum, Greece Cyprus and Israel had signed a joint declaration on June 15 in recognition of the significant progress made with preliminary technical and financial plans concerning the East Med project.

The energy ministers of Greece, Cyprus and Israel signed the declaration in June as part of a summit meeting at which the heads of state of all three countries made commitments to develop the project.

The East Med pipeline is planned to cover 1,900 kilometers underwater at a depth of as much as three kilometers and transfer approximately 10 billion cubic meters of natural gas, annually, from deposits in the southeast Mediterranean towards Europe.

The project is receiving full support from the European Commission as it represents a new natural gas supply source that promises to reduce Europe’s major energy reliance on Russia.

East Med pipeline will meet all prerequisites, Canete supports

Posted on by admin

European governments and the Israeli administration today pledged full support for the development of the East Med project, designed to transmit natural gas along a route stretching from Israel to Europe.

An objective has been set for the pipeline infrastructure project to be ready by 2025. The East Med project is planned to measure some 2,000 km and connect Israeli and Cypriot natural gas deposits with Greece and possibly Italy. The project’s budget could reach as much as 6 billion euros.

“This is an ambitious project that is clearly supported by the European Commission as it carries tremendous value with regards to supply security and the objective for diversification,” noted the European Commissioner for Climate Action and Energy Miguel Arias Canete.

Following a meeting with the energy ministers of Israel, Cyprus, Greece and Italy, Canete told reporters he believes the East Med project will meet all prerequisites to enable financial commitment.

Israel’s energy minister Yuval Steinitz noted that the pipeline project could be ready by 2025. “But we will try to speed up and shorten this timeline,” Steinitz informed. Asked about Israel’s energy plans, Steinitz responded: “I will develop both pipelines,” referring to East Med and an Israeli-Turkish pipeline.

Elio Ruggeri, CEO of IGI Poseidon, the owner of the East Med project, told Reuters that, according to the current budget, the project is estimated to cost 5 billion euros to reach Greece’s gas network and 6 billion euros to reach the Italian system.

IGI Poseidon is a joint venture formed by DEPA, Greece’s Public Gas Corporation, and Italian energy group Edison.

The energy ministers of all East Med project participants said they plan to meet in Cyprus six months from now to discuss the pipeline’s further development.

 

 

 

 

Greek-Israeli-US naval exercise in area of major energy interest

Posted on by admin

A trilateral naval exercise between the Greek, Israeli and American navies, dubbed Noble Dina, is planned to begin later this month with nearly a dozen surface ships, submarines and related air assets to engage in joint reconnaissance, counterterror and antisubmarine warfare training.

The exercise will be staged in an area that has produced major hydrocarbon discoveries in recent times and already led to major investments. Two major energy infrastructure projects of Greek interest, the East Med gas pipeline, to link Greece, Israel and Cyprus all the way to the Italian coast, and the Eurasia Interconnector, planned to link the Greek, Cypriot and Israeli power grids, will be developed in a wider area to serve as part of the arena for the upcoming naval exercise.

Cyprus will participate as an observer in the three-way drill, which is staged annually. It begins in Greece and will conclude in mid-April at the Israeli Navy headquarters in Haifa.

“It’s one of our most important exercises that allows us to hone our proficiencies in very complex scenarios,” Commander Assaf Boneh, the head of international cooperation for the Israeli sea service, told Defense News. “We’ll be training in a vast area from Greece to Israel, and this gives us a lot of room to practice multiple scenarios that require jointness.”

Officials meet in Brussels ahead of East Med ministers meeting

Posted on by admin

A further step towards the prospective East Med pipeline project’s development is expected to be made today when highly ranked Greek, Cypriot, Israeli and Italian officials meet in Brussels for a meeting on the infrastructure plan to link the European market with major Israeli and Cypriot natural gas deposits.

The four countries will be represented at energy ministry secretary general and management levels. Greece will be represented by the energy ministry’s secretary general Mihalis Veriopoulos.

Financial and technical details concerning the pipeline project will be discussed, while the ground will also be prepared for an imminent meeting between the energy ministers of all four nations on the matter. It is being planned to take place in Israel next month.

There has been much talk as to whether the pipeline project is sustainable or not. If developed, the pipeline, to link Israel, Cyprus and Greece all the way to the Italian coast, will rank as the world’s biggest underwater pipeline project.

A plan presented to the European Commission’s Directorate-General for Energy by prospective project contributor IGI Poseidon, a 50-50 DEPA (Public Gas Corporation) and Edison venture, put the project’s cost at approximately 5.7 billion dollars. This amount, considerably less than the initially anticipated amount, is expected to make the project technically and commercially viable.

The focus is now turning to details concerning EU funding, expected to cover a significant part of the project’s cost, and developing the pipeline according to schedule, the aim being to launch its operations in 2021.

 

DEPA’s East Med pipeline plan receiving Israeli, US support

Posted on by admin

The development prospects of the East Med underwater natural gas pipeline being promoted by DEPA, the Public Gas Corporation, as a plan to trasnsmit gas from the east Mediterranean to European market, are being propelled by Israeli and US support.

Commenting about a forthnight ago, Israel’s national infrastructure, energy and water resources minister Yuval Steinitz noted the project could serve as a main natural gas supply channel if the current signs of substantial deposits in areas controlled by Egypt, Cyprus and Israel are proven.

The recent establishment of talks between DEPA and US oil company Noble Energy, which led to the signing of a memorandum of cooperation in June, reflects the US interest in the development of the underwater project, a key part of energy relations linking Greece, Cyprus and Israel.

Noble Energy is the biggest company active in the development and exploitation of deposits in the east Mediterranean. The US energy company holds stakes in an offshore block within Cyprus’s Exclusive Economic Zone (EEZ) as well as a major Israeli-conttrolled block, Leviathan.

The developing ties between DEPA and Noble Energy have been propelled by encouraging results produced by two different studies conducted on the pipeline’s technical and financial sustainability.

Until recently, Noble Energy had maintained a reserved stance on the plan to construct an underwater gas pipeline, preferring LNG solutions instead for the export of gas from the Cypriot and Israeli deposits. The US company now appears more open to alternatives.

Greek, Cypriot and Israeli officials are scheduled to meet during the current month in Athens, at the European Commission’s local headquarters, to examine the results of preliminary technical and economic studies conducted on the East Med pipeline. Participants will seek to pave the way for more advanced talks at a summit meeting in Israel this December to involve the energy ministers of Greece, Cyprus and Israel, as well as the European Commissioner for Climate Action and Energy Miguel, Arias Canete.

 

 

East Med project feasible, IGI Poseidon chief tells conference

Posted on by admin

Elio Ruggeri, CEO of IGI Poseidon, has stressed the importance for southeast Europe of the East Med pipeline, a project to link Greece with major natural gas deposits in Cypriot and Israeli territorial waters, in a speech delivered at an Economist conference in Athens.

Ruggeri noted that the IGI Poseidon consortium is contributing to the effort to develop a natural gas corridor of multiple uses in the wider region, which will include Russian gas, the most important aspect.

“We are making an effort with Gazprom and, by the end of the year, will know whether the idea will lead to some sort of initiative,” Ruggeri remarked.

Ruggeri added that IGI Poseidon will seek to bring East Mediterranean natural gas to Europe via the East Med pipeline, adding that the project is technically and economically feasible. “There were doubts in the past. We examined the technical and economic sustainability through studies conducted by a leading research firm. This study was completed and showed that the project is technically feasible. Without a doubt, the project can be constructed. The project is also economically sustainable,” Ruggeri noted.

He also said that major potential exists for further natural gas discoveries in the East Mediterranean. “This could mean a new Norway. The region wil require many export solutions. Production and export must be co-developed,” he noted.

Poseidon reaches agreement with Noble for East Med preliminary work

Posted on by admin

Athens-based Poseidon SA, a 50-50 joint venture involving DEPA, the Public Gas Corporation, and Edison, has signed an agreement with Noble Energy International Ltd to finalize preliminary procedures for the East Med pipeline ahead of the project’s Front End Engineering Design (FEED) stage. As part of the agreement, Noble will also conduct a sustainability study for the prospective pipleline, to carry natural gas exports from major deposits discovered in the East Mediterranean region.

The East Med pipeline has been designated as a Project of Common Interest (PCI) and is supported by the EU through the Connecting Europe Facility (CEF), a co-funding program.

The East Med project received two million euros in 2015 through the CEF program to fund activies preceding the FEED stage.

Poseidon is involved in the development of three major natural gas pipeline projects, the Poseidon pipeline, a submarine passage linking northwestern Greece with Italy’s south, the IGB, to interconnect northeastern Greece with southern Bulgaria, and the East Med, planned to run from Cyprus to Greece’s northwest via Crete.

The East Med project, including submarine and overland segments, will cover a distance of roughly 1,900 kilometers. It is being planned to carry as many as 16 billion cubic meters of natural gas per yer (bcm/y) from major Levantine Sea deposits located in Cypriot and Israeli territorial waters. The East Med pipeline may also carry possible natural gas deposits in Greek territory.

East Med, combined with the Poseidon and IGB projects, will be able to supply natural gas to Italy and other countries in Europe’s southeast.