NewsLocalIsrael, Cyprus agree framework for settling offshore gas dispute

Israel, Cyprus agree framework for settling offshore gas dispute

Israel and Cyprus have reached an understanding over gas reserves straddling their maritime border, the Cypriot energy minister has said, in a key step towards resolving a nine-year impasse over offshore spoils.

Development of the Aphrodite gas field in Cypriot waters has been held up because a small part of it stretches into Israel’s maritime zone and another gas field there. The Cypriot field was first discovered in 2011.

Cypriot energy minister Natasa Pilides said she and her Israeli counterpart Yuval Steinitz on Tuesday agreed upon a framework to resolve the issue, and guidelines would be passed on to the companies involved in the project.

“The framework will be set out in a joint letter which is being prepared. We are both very satisfied we are now at this point after nine years of discussion,” Pilides told reporters.

At the same time, Steinitz, who was in Cyprus to sign a memorandum of understanding on another project, said there was a ‘fair chance’ of an eventual resolution.

“Nothing is certain, but there is a good chance that this might lead us to a solution of this little but significant obstacle in the wonderful relations and cooperation between Cyprus and Israel on energy and on many other issues,” he said.

Cyprus had in 2019 signed a 25-year concession with Noble Energy, Shell and Delek Drilling for exploitation of the Aphrodite field.

Israel had maintained an agreement was required before work started because part of Aphrodite overlapped on to the Israeli side.

Companies on the Cypriot side would enter talks with those on the Israeli side to resolve how the Israeli companies would be compensated, Steinitz’s office said in a statement.

If the companies did not reach agreement within 180 days it would be referred to an international expert who would try to resolve it for another 180 days.

Should there be no agreement by then, the issue would return to a state level, the statement said.

The Aphrodite field holds an estimated 4.1 trillion cubic feet of gas. At stake was about 10% of the deposit, which is a fraction of the gas already discovered in Israel.

Cyprus, Israel and Greece on Monday signed an accord to create a subsea power cable which will cross the Mediterranean and link their electricity grids.

(Reuters)

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