ExxonMobil is moving forward with the Declaration of Commerciality in Block 10, with a timetable for the commercialization of natural gas deposits “if all goes well”, between 2030 and 2035, the company’s Vice President, John Ardill, said following his recent meeting with the President of the Republic, Nikos Christodoulides, at the Presidential Palace in Nicosia.
Welcoming him to the Friday, 23 January meeting, the President of the Republic stated, among other things, that ExxonMobil’s activity in the Exclusive Economic Zone (EEZ) of the Republic of Cyprus is very important and constitutes a vote of confidence.
He added that they would discuss the company’s future plans for Blocks 5 and 10, noting that the Government is also ready to discuss additional blocks.
For his part, the company executive said, among other things, that ExxonMobil’s activities in Cyprus’ EEZ have been successful, particularly at Pegasus, expressing the company’s desire to continue with this momentum.
He also said that the goal is to proceed with commercialization and production of the discovered natural gas as soon as possible, noting that, so far, the total quantity in the Block 10 deposits Glaucus and Pegasus is estimated at between 6 and 9 trillion cubic feet.
“We had a very important meeting today between ExxonMobil, who operates Block 10 and Block 5, with both the Ministry earlier today and with the President's office and the President himself just now. We have a very long and strong relationship together, and that's been a very successful partnership,” he said in statements after the meeting.
He recalled that this cooperation led to two discoveries: the Glaucus field in 2019 and Pegasus last year. “The next step for our partnership is to look at paths for those two resources to move to development. And that's the topic of the conversation today”, he added.
As he noted, during his meeting with President Christodoulides, the company presented a plan to advance the deposits through a Declaration of Commerciality, which, as he said, will constitute the next big milestone. Subsequently, options toward the development of the deposits will be evaluated.
Asked about the timetable for implementing the above, Ardill said that the first and most important step “in front of us is the Declaration of Commerciality. We will be looking at that in the first half of this year, April time frame would be our target. And we're doing the work right now on both sides to make that important milestone happen. That really puts us then on the path to development”, he said.
He noted that the next steps will include additional drilling and the final stages of appraisal. He recalled that the appraisal well has already been completed at Glaucus, while it is still pending for Pegasus. “The next natural step is an appraisal well at Pegasus and a test, and we would look to do that in 2027. That will give us all the subsurface information. And then we go into what's called front-end engineering and design, which is FEED, that would follow that. And that would be ahead of a final investment decision on the project, then ultimately to start up the production”.
“If all of that works, we would expect to have production in a 2030 to 2035 time frame. And so, we'll obviously be working as quickly as possible, and there are some key steps in there we still have to go through. So that's why we always use a range”, he said.
Regarding the findings of the deposits, Ardill noted that there is a range of 6 to 9 trillion cubic feet (TCF). “The reason there's a range on that is we don't have that second appraisal well yet from Pegasus. And once we have that, range will narrow. But what we do know at this point is we've got enough gas to move towards development”, he noted.
As for Block 5, where Exxon is also active, he said that the exploratory well “Electra” was unsuccessful at finding commercial hydrocarbons. However, he noted that “it was very important from a geology standpoint. It proved up reservoir and a working hydrocarbon system. So, we take that information and we're incorporating it into our ongoing work on Block 5 to understand additional prospectivity. And that work's ongoing”, he underlined.
Asked whether the company is also showing interest in blocks of Cyprus’ EEZ that have not yet been licensed, he said this was part of today’s discussion. “What we want to do is the most important and first priority is to get Glaucus and Pegasus on the path to fastest development. So we spent more than half the meeting working on that and we have a clear path forward there that we're aligned around”.
He also added that in the second half of the meeting, they discussed with President Christodoulides what more can ExxonMobil do for Cyprus in terms of expiration beyond Block 5 and 10. “We have a list of ideas there that would include additional new acreage. We talked about that. And so that's in our plans to work on in the months ahead”.
For his part, the Minister of Energy, Commerce and Industry, Michalis Damianos, said that “we had a very constructive discussion with the Exxon delegation in Cyprus. We thanked them for their support to the Republic of Cyprus over all these years, and we believe that their presence here also demonstrates the level of support of the company itself, both toward the Republic of Cyprus and more broadly toward drilling and natural gas exploration in our EEZ.”
Asked whether the government is satisfied with the timetable mentioned by Exxon’s representative, he said, “this is the timetable that has been decided. We are proceeding as planned.”
(Source: CNA)
