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Cyprus: Historic Gas Discovery

The inhabitants of the island of Cyprus had a very exciting late Christmas present, when Noble Energy announced that they had made a significant gas discovery offshore on December 28 last year.
This article appeared in Vol. 9, No. 1 - 2012

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Regional West-East seismic line illustrating the recent gas discoveries in Israel and the site of the recent Aphrodite discovery off Cyprus. Source: Spectrum The Cyprus A-1 well is reported to have found 95m of pay in multiple high-quality Miocene sand intervals, and initial estimates suggest that the field could hold gross reserves of between 5 and 8 Tcfg . The well, which is in Block 12, has an area of about 100 km2, is in waters about 1,690 m deep, and was drilled to a depth of 5,860m.

Further appraisal drilling will be carried out on the field, known as Aphrodite, and on the rest of Block 12, one of 13 offshore Cypriot blocks available. It is considered possible that these reserve estimates will increase. Noble Energy operates the well with a 70% working interest. Delek Drilling and Avner Oil Exploration will each have 15%, subject to final approval by the Government of Cyprus.

On hearing of the discovery, the Commerce Minister Praxoulla Antoniadou stated that the find could be worth approximately US$129 billion (€100 billion), enough to satisfy he country’s electricity production needs for 210 years. At the moment Cyprus imports has to import all its fuel, so the discovery has very significant implications. There are also serious political implications, as Turkey still lays claim to the northern part of the island, which it invaded in 1974, and it does not acknowledge the internationally recognised Greek Cypriot government. The Greek and Turkish Cypriots have been engaged in peace talks under United Nations auspices for decades, and this discovery is likely to increase tensions in the country.

Exploitation of the reserves could present financial challenges, as it is suggested that building a gas pipeline to reach the Cyprus coast would cost at least US$1.3 billion (EUR 1 billion. The size of the Cypriot market does not justify such a large cost and a liquefaction plant will also be needed to enable gas exportation and render the project profitable.

Israel: Increased Reserves at Leviathan

Approximate location of the recent Noble Energy gas discoveries in Israel and Cyprus, which together amount to over 33 Tcfg. Source: NASA The Cyprus discovery is the fifth consecutive natural gas field discovery for Noble Energy and its partners in the greater Levant Basin. Earlier in December it had announced that results from its Leviathan appraisal well on the Amit license offshore Israel suggest that the reserves are likely to be larger than the initial estimate and the field is now thought to hold up to 20 Tcf reserves of gas.

The upgrading of reserves estimates comes from the discovery of approximately 88m net pay in multiple intervals at the appraisal well, Leviathan 3, which is located more than three miles east of the original Leviathan discovery and was drilled to a total depth of 5,225m (17,146 ft) in about 1,670m (5,480 ft) of water. Reservoir thickness and quality were found to be greater than anticipated and the appraisal well confirmed the gas/water contact.

The Leviathan field, which was initially discovered in December 2010, is estimated to cover about 325 km2. Drilling has now recommenced at Leviathan 1 using the Homer Ferrington deepwater semisub, to investigate deeper targets at the site. The gas found at Leviathan is biogenic in origin, but Noble Energy believe there is good evidence for a thermogenic petroleum in deeper, pre-salt sediments.

Leviathan is operated by Noble Energy Inc. with a 39.66% interest, with Delek Drilling and Avner Oil Exploration having 22.67% each and Ratio Oil Exploration 15%. The field is expected to begin producing by 2016, while the Noble’s other large Israeli accumulation, Tamar, is expected to begin production later this year.

Australia: Thirteenth WA Discovery


Aerial view of the Gorgon LNG plant site being built on Barrow Island, 56km off the north-west coast of Western Australia. Source: Chevron Australia One of the new discoveries, Satyr, lies close to the giant Io-Jansz gas condensate field, which will be developed as part of the massive Gorgon Project. Source: Chevron Australia Chevron has been making steady progress in the Carnarvon Basin off North West Australia. On January 19 this year it announced that its Satyr3 well in Block WA-374-P had discovered 74m (243 ft) net gas pay. The block is in the Exmouth Plateau, about 182 km north of the town of Exmouth in deep waters of over 1,120m. It is operated by Chevron with a 50% stake, partnered by ExxonMobil and Shell, each with 35%. It lies just to the south of the large Io-Jansz gas condensate field, which was discovered in 2000 and contains about 20 Tcf of recoverable reserves and covers an area in excess of 2,000 km2. The primary reservoirs of the Exmouth Plateau are the Middle – Late Triassic Mungaroo Formation, the Late Jurassic (Oxfordian–Tithonian) sands of the Dingo Claystone, which forms the reservoir at Io-Jansz, and the Early Cretaceous Barrow Group.

Satyr 3 is the thirteenth discovery Chevron has made off Australia since 2009. Its most recent success before this was Vos 1, discovered in mid-December 2011. This well was also drilled on the Exmouth Plateau, in the WA-439-P permit area, approximately 300 km from Exmouth and the same distance due west of Satyr. Chevron is again operator on this permit and holds a 50% interest, with Shell holding the remaining 50%.

Chevron has been working in Australia for nearly 60 years and is closely involved with the development of the Wheatstone natural gas projects and the Browse liquefied natural gas development scheme. It is also operator of the Gorgon natural gas project, one of the world’s major natural gas projects and the largest single resource natural gas project in Australia’s history. It is designed to develop the Gorgon and Jansz/Io gas fields, which have a combined resource of about 40Tcfg. The project includes the construction of subsea gas-gathering infrastructure, and it is to be expected that the hydrocarbons found in the Satyr discovery will be exploited as part of the scheme. The project also involves the construction of a 15 million tonne per annum LNG plan on Barrow Island and a plant with the capacity to provide 300 TJ per day of domestic gas for Western Australia. Gorgon LNG will be off loaded via a four kilometre long loading jetty for transport to international markets. The project is on schedule for first gas in 2014.

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