Katakolo 10m barrel estimate a major bonus for Energean

An Energean Oil & Gas hydrocarbon block in Katakolo, off western Peloponnese, has been certified to measure 10.7 million barrels by an independent agency, representing triple the amount of an initial estimate of 3 million barrels made by Greek authorities when staging an international tender for the block.

The development comes as a major bonus on the domestic front for Energean Oil & Gas, whose CEO Mathios Rigas has essentially based himself in London to organize financial matters concerning a 1.5 billion-euro investment by the company in Israel. As a result, Dimitris Gontikas, managing director of Energean Oil & Gas subsidiary Kavala Oil, is now managing Energean’s domestic matters.

Besides the Katakolo bonus, Energean’s domestic prospects include the Prinos block in south Kavala, certified by an independent agency to possess 40 million barrels, and, possibly, a further 20 billion barrels.

As for Energean’s interests in Israel, the company’s certified deposits amount to 2.4 trillion cubic feet of natural gas, the equivalent of 446 million barrels of crude. Energean holds a 50 percent stake in Energean Israel, which fully owns the Karish and Tanin fields.

Ionian Sea Block 2 seismic survey no sooner than next November

Seismic survey work planned by a consortium comprised of ELPE (Hellenic Petroleum), Total and Edison at Block 2, west of the Ionian island Corfu, cannot take place until at least the end of autumn next year as a result of a delay by Greek Parliament to approve the agreement.

The three-member consortium signed an exploration and exploitation license agreement with the Greek State in late October.

Consortium sources reminded that seismic surveys, needed to identify possible hydrocarbon deposits and drilling targets, can only be performed during specific periods, these being spring and autumn.

As a result of environmental and tourism-related reasons, seismic surveys cannot take place at Block 2 during winter or summer.

Parliamentary approval of Block 2 remains pending, which eliminates any chance of seismic surveys being conducted at this specific license next spring. It is estimated that acceleration of the approval procedure would give the consortium enough time to reserve a specialized vessel, needed for the seismic survey, for November, 2018.

Latest information has indicated that a seismic survey planned for the Gulf of Patras, a license held by ELPE (Hellenic Petroleum), will take place as planned, early in 2019.

Authorities have described the Gulf of Patras as an area of great hydrocarbon potential, based on seismic survey work conducted in the past by DEP-EKY, a former subsidiary of DEP (Public Petroleum Corporation).

In the past, over 70 drilling ventures have been perfomed at various locations in Greece, including the Gulf of Patras and Block 2, reoffered to investors through open-door international tenders. This development essentially served to reopen Greece’s hydrycarbon market to investors.

HAEE London event examines southeast Europe energy developments

Responding to requests from abroad to address the serious gap in the comprehensive briefing of the British and global energy community on the Greek-Cypriot dip type and their combinatorial capabilities, ΗΑΕΕ, the Greek Think Tank for Energy Economics, as the Greek affiliate of the international think tank based in the US, ΙΑΕΕ, has used well-known representatives of the market, state, political and academic life, and presented, in London, Greek and Cypriot activities covering the full spectrum of the energy sector.

In this integrated approach to the energy developments in Greece and Cyprus, an event entitled “Energy Developments in S.E Europe: Riding the Global Trends”, was staged in London this week, on November 28.

The event was organized in collaboration with the postgraduate studies department at the London Research Center for Energy Management, headed by the President of HAEE, Dr. Kostas Andriosopoulos, who also coordinates the energy teaching of the other departments of the complex. The international network of energy agents in the eastern Mediterranean region is informed about developments in the ESCP network, which, apart from academic completeness, also has the advantage of being directly connected to the energy market.

Cyprus was represented by the candidate for the presidency in the forthcoming elections, Nikolas Papadopoulos, who has experienced the whole energy course of the island. The particular value of his contribution at the London conference lies in the fact that, as a candidate for President of Cyprus with a great chance of electoral success, he presented with realism what can and should be done on the island, with the possibilities and conditions prevailing today.

The energy future of Greece was presented by HHRM president Giannis Basias, who analyzed the data on the existence of hydrocarbons in the Greek offshore and land environment and underlined the positive prospects for their exact localization and exploitation, both for Greece and the foreign companies considering investments in the region.

The spectrum of investment, scientific, technical, bureaucratic and political factors concerning foreign energy investments in Greece was presented by TAP director Richard Skoufias.

The experienced manager of the complicated and demanding project concerning the construction of the Greek section of the Southern Corridor for the transportation of natural gas from the Caspian Sea and other sources to Europe underlined the fact that TAP has been accepted in practice by the Greek society and leaders at regional and central level, resulting in its smooth implementation.

TAP, Skoufias stressed, is a model of successful foreign investment in Greece as it has been a concern to cover the specificities of local communities.

The interest of foreign companies to invest in Greek energy was expressed by Melina Yosserand, spokesperson for the American shale gas exporting company Tellurian Inc., seeking participation in the development of the prospective LNG floating station in Alexandroupoli, northeastern Greece. This project promises to promote US gas up to Bulgaria and further north. The energy project in Alexandroupoli, which also involves DEPA, Greece’s public gas corporation, is an immediate goal for the US.

The plans of the international energy community for hydrocarbons in Greece and Cyprus were presented by the President of the International Gas Union Mel Ydreos. He underlined that the eastern Mediterranean region is mature for direct investment in research and exploitation of natural gas, while also noting that theoretical obstacles and objections experienced from time to time can be attributed to political considerations which should not interfere with the smooth functioning of the free market.

The Head of Energy Strategy and Planning, energy consultant Tasos Garis recapitulated the conclusions of the conference and added the important factor of electricity and alternative forms of energy, a prerequisite and need not only for the protection of the environment, but also rationalization in many aspects, including economic and energy support to the modern society.

 

 

EDEY head sees hydrocarbon results within 3 years

The country’s hydrocarbon exploration endeavors will produce surprise results within the next three years, Yiannis Basias, the recently appointed chairman of EDEY, the Greek Hydrocarbon Management Company, has forecast in an interview for local business news channel SBC’s Energy Week show.

The EDEY chief, who reminded that Prinos in northern Greece is the only hydrocarbon source producing at present, noted that exploration work covering a large part of western Greece may have commenced by the end of the year as nine licenses have either already been approved or are about to be approved.

“We could have some good results in the next three years,” Basias remarked, adding that the outcome of drilling ventures will determine whether foreign and Greek firms will decide to further pursue their efforts.

The EDEY chief put the probability of success at between 20 and 25 percent. “Therefore, we need to conduct five drilling operations, which is why the endeavor carries financial risk, as each drilling effort could cost between 50 and 150 million euros,” Basias said.

He pointed out that the offshore areas being eyed are challenging deep-water blocks. “This means that major deposits will need to be discovered to make the effort feasible for oil companies,” the EDEY boss explained.

Major oil companies currently appear interested and prepared to take risks, Basias told, adding that the results of recent private meetings with investors in London were encouraging.

Commenting on a delayed international tender concerning blocks in the Ionian Sea and off Crete, Basias explained that all related requirements were delievered by EDEY last summer and publication is now being awaited in the EU’s official journal, the OJ.

A seven-year period would be needed for production to begin if hydrocarbon deposits are discovered, according to Basias.

Energean Oil & Gas announces first CPR results for Montenegro blocks

Energean Oil & Gas has announced the first Competent Persons Report (CPR) for its assets offshore Montenegro, compiled by Netherland Sewell & Associates (NSAI), detailing the recoverable gas and liquids resource estimates in respect to Energean’s 100% interest in blocks 4218-30 and 4219-26.

The CPR shows the combined net unrisked prospective recoverable resources (P50) for the two blocks, awarded to the company earlier this year, as 1.8 TCF natural gas and 144 mmbbls liquids (438 mmboe in total).

Energean is currently the sole operator, with 100% working interest, of offshore blocks 4218-30 and 4219-26. The blocks were officially awarded in March 2017, following the signing of a concession agreement between the company and the State of Montenegro. The two blocks cover a surface area of 338 km2 in shallow waters.

The CPR is part of the first three-year exploration phase, which entails a mandatory work programme including a 3D seismic survey covering the two blocks that is planned to be acquired in 2018, and geological and geophysical (G&G) studies. The total cost of this initial exploration phase is estimated at US$5m.

The CPR is an important step in scoping the potential of the offshore Montenegro area, which is currently underexplored, despite the fact that oil and gas discoveries were made during drilling by previous Operators in late 20th century, but not commercialised.

Commenting on the CPR findings, Energean CEO, Mr. Mathios Rigas, stated:

“The CPR further suggests that Montenegro sits in the ‘sweet spot’ of untapped potential in the eastern Adriatic. The area remains substantially underexplored, despite having what appears to be a working petroleum system with extensive sandstone and carbonate reservoir development. The western offshore Adriatic has been a prolific hydrocarbon-producing province for over 50 years for both oil and biogenic gas and we believe that the same hydrocarbon plays extend into offshore Montenegro.

“With exploration experience in western Greece, Energean has developed a detailed understanding of the area’s geology and is committed and uniquely positioned to maximise development possibilities and unlock the region’s hydrocarbon potential.”

Energean is a leading independent E&P company focused on the eastern Mediterranean region, where it holds nine E&P licenses, encompassing offshore Israel, Greece, the Adriatic and onshore north Africa.

It is the only oil and gas producer in Greece with a 35-year track record of operating offshore and onshore assets in environmentally sensitive areas and employs 480 oil and gas professionals.

The group has 37 million barrels (2P) in the Prinos License, offshore northeastern Greece and through its subsidiary Energean Israel, a company in which Energean and Kerogen Capital hold 50% each, resources of approximately 450 million barrels of oil equivalent (2C) in the Karish and Tanin Fields.

Energean Oil & Gas has recently received approval from the Israeli Government of the FDP for the Karish and Tanin fields, aiming to use an FPSO and produce first gas in 2020.

Energean Oil & Gas is also pursuing an ongoing investment and development programme to increase production from the Prinos and North Prinos Oil Fields and develop the Epsilon Oil Field, located in the Gulf of Kavala, northern Greece.

The company has secured a 25-year exploitation license for the Katakolo offshore block in western Greece with first oil expected in 2019/20, representing the first production of oil or gas in the west of the country.

Energean Oil & Gas also has significant exploration potential in the licenses held in western Greece, Montenegro and Egypt, which provide the basis for future organic growth.

Crete offshore blocks tender set for EU gazette publication

An international tender offering exploration and exploitation rights to offshore blocks southwest and west of Crete, as well as the Ionian, is expected to be published in the Official Journal of the European Union (OJ) within the next ten days, sources have informed.

The tender, announced on August 17, also needs to be published in the OJ, the EU’s official gazette of record, before the countdown for binding offers begins. Once published, interested parties will have 90 days to submit their offers to EDEY, the Greek Hydrocarbon Management Company.

Certain pundits have linked the anticipated speed-up of the tender’s publication to ExxonMobil’s Cretan interest and Greek Prime Minister Alexis Tsipras’s current official visit to the US for a meeting with President Donald Trump.

The interest expressed by ExxonMobil, joined by France’s Total and ELPE (Hellenic Petroleum) as consortium partners, prompted Greece’s energy ministry to proceed with the tender.

If no other investors emerge with offers, then the Greek State will move ahead and begin negotiations with this three-member consortium.

Italy’s ENI, which discovered Zor, the gigantic Egyptian gas field, is rumored to be interested in two Crete offshore blocks, one southwest, the other west of the island. The Italian firm has already established operations in Cyprus and is eyeing the wider southeast Mediterranean region.

Total, Edison, ELPE set to sign off-Corfu Block 2 agreement

A consortium comprised of Total, Edison and ELPE (Hellenic Petroleum) is expected to be granted an exploration and exploitation license for offshore Block 2, west of the Ionian island Corfu, very soon – possibly within the next few days, definitely within the current month.

Procedures entered the home stretch last week when a supervisory committee completed a pre-contractual inspection, offering its approval for the Block 2 agreement.

The process dates back to 2014 when Block 2 was offered to investors as part of a wider international tender. Participants submitted offers in 2015 and, last year, the Total-Edison-ELPE consortium was declared a preferred bidder for hydrocarbon exploration work at the offshore block west of Corfu.

The agreement expected to soon be signed will require Parliamentary approval before the consortium can start work. The team’s effort will begin with new seismic surveys whose sharper data should provide greater detail to help determine drilling locations.

Authorities have high hydrocarbon deposit hopes for Block 2 and the area west of Corfu. Scientists believe the region shares similar geological traits to a geological zone off Italy, where considerable oil deposits have already been identified. The upcoming survey work at Block 2 promises to determine this theory’s validity.

France’s Total, one of the world’s biggest oil compamies, is heading the Block 2 consortium. Italy’s Edison, a partner in the venture, is a member of the EdF corporate group, also French.

Barring unexpected developments, the first round of drilling should take place in approximately three to four years, around 2020 or 2021.

According to forecasts based on existing seismic survey data, Block 2 could contain a deposit amounting to two billion barrels.

Balkan hydrocarbon collaboration discussed at Athens conference

The prospect of collaboration between state hydrocarbon companies was raised by Yiannis Bassias, chief executive of EDEY, the Greek Hydrocarbon Management Company, at the Balkans Petroleum Summit, held in Athens October 3-4 by global event organizer IN-VR Oil & Gas.

The summit brought together state hydrocarbon authorities, regulators and international oil company officials for a discussion on exploration and production projects, as well as an exchange of ideas on future hydrocarbon projects in the Balkans.

Bassias, as part of his contribution to the event, also underlined the similarities and differences between methods favored by Balkans countries in dealing with the resurgence of Balkan region interest by the international industry over the past seven years.

The importance of midstream projects and new infrastructure, need for reprocessing exisiting data and coordination for common regional petroleum targets, achievable only through information exchange by Balkans states, were among the topics addressed at the event.

Participants unanimously agreed that the EU hydrocarbon directive should be used as a guiding mechanism for a framework of common business practices.

The panel agreed to stage a follow-up meeting in the near future and meet annually.

Other participants included: Vladan Dubljevic, Executive Director of the Montenegrin Hydrocarbon; Milica Zorić, Head of Geology and Mining Division of the Ministry of Mining and Energy of Serbia; Florina Sora, Senior Advisor of the National Agency of Mineral Resources of Romania; Ilia Gjermani, Director of Petroleum Department of the Ministry of Infrastructure and Energy of Albania; and Hazim Hrvatovic, Director of the Institute of Geology of the Federal Ministry of Energy of Bosnia and Herzegovina

 

 

 

‘ExxonMobil plans to invest €5bn for Crete exploration’

Global oil industry giant ExxonMobil has committed itself to investing 5 billion euros for hydrocarbon exploration and exploitation in the Greek market, Economy and Development Minister Dimitris Papadimitriou told investors at the 12th annual London roadshow of Athens-listed firms, as part of the government’s wider effort to present Greece as a market now beginning to attact major investments.

The minister made reference to a series of foreign investment plans for the Greek market, including that of ExxonMobil.

Sources have confirmed the ExxonMobil intention to set aside 5 billion euros for investments in the Greek market, developments permitting.

An international tender offering exploration and exploitation licenses for offshore blocks west and southwest of Crete is still in progress, meaning that the minister’s reference to ExxonMobil does not represent a finalized investment plan. Rivals, such as Chevron, for example, could suddenly emerge with a better offer, or the tender could sink.

ExxonMobil has joined forces with France’s Total and Greece’s Hellenic Petroleum (ELPE) for the Crete tender.

It should also be reminded that, besides Prinos, in the country’s north, no other location in Greece has yet to produce confirmed hydrocarbon deposits. All is still at a speculative stage.

By comparison to Papadimitriou’s hasty remarks concerning ExxonMobil’s investment plan for Greece, energy minister Giorgos Stathakis has remained far more reserved.

Bidders for the Crete hydrocarbon international tender, offering two offshore blocks, one south of the island, the other southwest, measuring nearly 40,000 square kilometers in total, face a December deadline.

Offers will need to be submitted to EDEY, the Greek Hydrocarbon Management Company. According to the tender’s terms, bids will be appraised within 60 days of the deadline and contracts signed within 60 days of the appraisal’s completion.

 

More Cypriot gas discoveries needed for sustainability, expert explains

Hydrocarbon deposits discovered through a drilling initiave conducted by Total at Cyprus’s Block 11, an offshore plot southwest of the island, cannot yet be utilized, but the drill has provided many significant and positive findings that promise to support prospective efforts, Dr. Konstantinos Nicolaou, a petroleum geologist and board member of the Cyprus Hydrocarbons Company (CHC), as well as a technical consultant for Energean Oil & Gas in Greece, has told energypress in an interview.

The official denounced various media reports purporting to various additional hydrocarbon discoveries in Cyprus’s exclusive economic zone (EEZ).

Nicolaou also noted that work concerning Cyprus’s “Aphrodite” gas field is not being delayed. Instead, the scientist pointed out that additional deposits possessing satisfactory hydrocarbon amounts still need to be discovered to make the development of an LNG terminal sustainable and prompt investments.

 

 

 

Tenders stir up interest amid survey purchase complaints

Licences to be offered by the Greek State for exploration and exploitation of offshore blocks in the Ionian Sea and off Crete now appear to be drawing wider attention following an initial interest displayed by investors that prompted authorities to organize three tenders.

However, prospective investors are believed to be discontent with a term requiring them to purchase existing seismic surveys. The terms of the upcoming tenders were recently published in the local gazette.

Initial interest expressed by a consortium comprised of ExxonMobil, Total and ELPE (Hellenic Petroleum) for two blocks off Crete, one southwest, the other west, led authorities to announce a tender, while Energean Oil & Gas got the ball rolling for a third tender offering an Ionian Sea block.

Though new firms now entering the picture have yet to be named, authorities have noted that these are mid-scale and large-scale enterprises which have eyed the Greek market in the past.

Shell, Japex, Dana Petroleum, INA and Hunt are believed to be among the oil companies maneuvering ahead of the tenders.

The sale procedures are expected to be launched towards the end of September, when published in the Official Journal of the European Union. Investors will then have 90 days to submit their offers. Greek authorities will push for the appraisal procedure of offers to have been completed by early 2018.

Prospective investors have expressed objections against a term requiring all participants to purchase existing seismic surveys concerning their respective areas of interest. PGS has conducted surveys covering 12,347 square kilometers of offshore Greek territory.

A number of sources told energypress that investors should have the right to conduct their own seismic surveys and then purchase the PGS data as additional information only if needed.

It is estimated that the cost of purchasing seismic surveys concerning the Ionian Sea block is roughly two million euros, while the price tag for the seismic surveys linked to the two blocks off Crete is estimated at five million euros.

 

 

Ministry’s revision plan, a risk, catches oil majors by surprise

Major foreign oil companies showing an interest to invest in Greece’s hydrocarbon market have been caught off guard by an energy ministry intention for legal framework revisions, meaning legal adjustments investors will need to make may prompt delays, which is paradoxical to the ministry’s ultimate objective for swifter progress in this sector.

Top-level government officials had previously assured investors that prospective exploration and exploitation ventures would be based on the exisiting license system.

The ministry has declared that it wants to reduce the amount of time needed by authorities to issue exploration and exploitation licenses. However, its intention to switch from a lease agreement to production sharing agreement system for the sector will force investors to make legal revisions for protection.

These legal adjustments by prospective investors will require at least six months, while forthcoming tenders could be end up being delayed by about a year, pundits have informed.

All this comes at a time when procedures are already underway for the announcement of a tender concerning offshore blocks located northwest, west amd southwest of Crete.

In seeking to make revisions at such a crucial time, the ministry is taking a risk. The Greek hydrocarbon market was rocked by delays in 2014, when a major tender was staged. Investors showed limited interest as the tenders at the time ended up coinciding with a drastic drop in oil prices.

Wider developments in the Mediterranean, including the discovery of new hydrocarbon deposits, have provided the Greek market with a second opportunity.

It remains to be seen if major oil companies will remain interested in the Greek hydrocarbon market should legal framework revisions be carried out.

 

 

 

Energy ministry planning key hydrocarbon sector changes

The energy ministry plans to make revisions to the legal framework concerning the country’s hydrocarbon sector, the intention being to swiften procedures for tenders offering exploration and exploitation licenses, bolster the operating ability of  EDEY, the Greek Hydrocarbon Management Company, and, possibly, change the sector’s concession model. The ministry’s plan is expected to be presented tomorrow at KYSOIP, the Government Council for Economic Policy.

The ministry aims to implement its revisions by the end of the year so as to avoid major delays experienced in the past.

According to the energy ministry’s plan, EDEY is expected to be reshaped as a more flexible enterprise, which would simplify hiring procedures for specialized personnel, needed to take on an anticipated greater workload. EDEY is planning to stage a series of new tenders.

The existing framework allows for lease agreements and production sharing agreements, both standard systems in the global industry. To date, all exploration and exploitation deals signed in Greece have been based on lease agreements.

The government wants to increase its involvement, thereby increasing its share of the investment risk and, by extension, potential benefits. The market’s response to these prospective changes remains to be seen.

EDEY pursuing 3-year plan to draw key hydrocarbon investors

The reprocessing of existing seismic data and accumulation of new data in selected areas, a move aiming to attract petroleum companies, both local and foreign, with experience in hydrocarbon exploration and production, stand as the main objectives set by EDEY, the Greek Hydrocarbon Management Company, for the next three-year period, company officials have stressed.

EDEY, now led by a recently appointed new board, aims to revitalize Greece’s oil and gas sector though the establishment of a skilled team possessing deep knowledge in technical, legal and economic issues concerning the country’s hydrocarbon domains, the company noted in a statement.

As a result, EDEY has already teamed up with scientists and technical officials possessing specialized hydrocarbon exploration and exploitation skills, EDEY noted.

The company also plans to form a think-tank whose line-up will include legal officials with petroleum sector backgrounds as part of an effort to improve Greece’s exisiting legal framework for the hydrocarbon sector.

EDEY plans to sign a new agreement with Norway’s PGS for the collection of additional seismic data in new areas. PGS, supported by France’s Beicip, had previously conducted a seismic survey for EDEY in 2013.

A total of six exploration licenses have been issued in Greece since 2013, primarily for western parts of the country. The additional seisimic data and reprocessing of older data is expected to draw more investors to vacant blocks in the Ionian Sea, south of Crete, as well as onshore expanses in central Greece.

EDEY receiving EBRD support for offshore safety rules

The deadline of an international tender launched by the European Bank for Reconstruction and Development (EBRD) for the recruitment of a specialized consultant to offer EDEY, the Greek Hydrocarbon Management Company, guidance in the implementation of offshore safety regulations, a task the hydrocarbon company has taken on, expired just days ago.

EDEY assumed the responsibility of monitoring and implementing offshore safety regulations in 2016 following a Greek energy ministry proposal.

In other parts of Europe, legal obligations for the safety of offshore regulations vary and are covered by either independent agencies or ministries. For example, in Cyprus the task has been assumed by the country’s labor ministry while in the UK and Norway, an independent authority has been charged with the task.

EDEY sought support from the EBRD for the task. The EBRD is offering financial support, assessment of current conditions, and is also staging the international tender, seeking an international expert who will audit Greece’s exisiting offshore facilities and offer training to personnel.

The EBRD expects to reach a decision on the international tender’s preferred bidder in about two weeks.

ELPE, Exxon, Total express exploration interest for broad offshore area

A powerhouse consortium comprised of ExxonMobil, Total and ELPE (Hellenic Petroleum) has expressed an interest to Greek authorities for hydrocarbon exploration work covering a gigantic offshore expanse southwest of the Peloponese and stretching all the way to the island Gavdos, south of Crete, according to souces.

Quite clearly, the trio is interested in exploring deep-sea regions for which sufficient data does not yet exist. The only favorable hydrocarbon hints at this stage are limited to encouraging signs provided by previous seismic surveys at specific areas.

The wider area of interest, measuring numerous square kilometers, includes offshore blocks that had been incorporated into an international hydrocarbon tender back in 2013.

The areas framed by the consortium are not located in any disputed zones. All are clearly located within Greece’s Exclusive Economic Zone (EEZ), as prescribed by the United Nations Convention on the Law of the Sea.

The Greek State does not face any deadline as to the time period it has at its disposal to respond to the consortium’s proposal. However, once the proposal has been officially received, the Greek State will need to publish the consortium’s expression of interest in the Official Journal of the European Union (OJ), formalizing its acceptance and setting the terms of an international tender. The publication will need to remain in the OJ for at least one month.

An announcement of a tender within the current year, followed by the launch of seismic survey work in 2018, whose results will determine future moves, is viewed as timely progress.