Despite the war in Gaza, majors committed to developing East Med gas are playing the long game as evidenced by Eni and TotalEnergies’ recent discoveries offshore Cyprus and Chevron’s decision to invest the final $24 million needed to kick off an overall $673 million plan to expand production at Israel’s Tamar gas field.
Lebanon meanwhile has offered nine offshore blocks in a 3rd licensing round that ends in July, while TotalEnergies, Eni, and QatarEnergy ponder what to do next after having drilled a dry hole last autumn on Block 9 in Lebanese waters near Beirut’s maritime border with Israel.
Chevron Declares FID on Israel’s Tamar Expansion
Chevron and its partners in the Tamar consortium announced a final decision to invest $24 million in the second of a two-phase plan to boost Tamar’s production capacity to up to 1.6 Bcf/D from the current 1.1 Bcf/D for domestic consumption and additional gas exports to Egypt.
“Reaching FID for Phase 2 of Tamar’s expansion reflects Chevron’s ongoing commitment to partnering with the State of Israel to continue development of its energy resources for the benefit of domestic and regional natural gas markets,” Jeff Ewing, managing director of Chevron’s Eastern Mediterranean Business Unit, said in The Times of Israel.
Phase 1 of the project envisions laying a 150-km pipeline between the production platform and the Tamar gas field located offshore west of Ashkelon in parallel to two existing pipelines. This third pipeline will initially boost production to 1.2 Bcf/D, according to Chevron.
Existing compressors at the onshore terminal at Ashdod will be reinstated during Phase 2 with work on both phases expected to be completed in 2025 at a total investment of $673 million.
On 16 February, Tamar partners announced the signing of a contract to sell 4 billion m3 per year of gas to Egypt’s state-backed buyer Blue Ocean Energy over 11 years starting on 1 July 2025.
Operator Chevron Mediterranean Ltd. holds 25% of Tamar with partners Abu Dhabi’s Mubadala Energy (11%) and Israeli participants—Isramco (28.75%), Tamar Petroleum (16.75%), Tamar Investment 2 (11%), Dor Gas (4%), and Everest (3.5%).
Well Tests Show Big Potential Offshore Cyprus
Eni and TotalEnergies announced that tests on the Cronos-2 appraisal well on Block 6 offshore Cyprus had yielded production capacity estimates exceeding 150 MMscf/D, according to press statements issued separately by Eni and TotalEnergies on 15 February.
Located 160 km southwest of the Cypriot coast, Cronos-2 encountered several carbonate reservoir intervals with a net reservoir thickness of 115 m, confirming the lateral extension of the Cronos-1 discovery that was drilled 3 km away in August 2022.
Production tests confirmed a connection with a thick gas column with excellent permeability intervals, the partners added.
“The successful appraisal of the Cronos gas discovery confirms the presence of significant resources and production potential in Block 6,” TotalEnergies’ Julien Pouget, senior vice president Middle East & North Africa, exploration & production, said in a prepared statement.
Full evaluation of the discovered resources will now be carried out to determine the best development option,” he added.
Cronos-2 is the fourth well that Eni has drilled in Block 6 following the gas discoveries of Calypso in 2018 and of Cronos and Zeus in 2022.
The Italian major operates Block 6 and holds a 50% interest with France’s TotalEnergies partnering for the other 50%. Eni also operates Blocks 2, 3, 8, and 9 and has participating interests in Blocks 7 and 11, operated by TotalEnergies.
In Cyprus, TotalEnergies also holds participating interests in partnership with Eni in Blocks 2 (20%), 3 (30%), 8 (40%), and 9 (20%).
Lebanon Rests Hopes on New Licensing Round
TotalEnergies informed Lebanon’s Energy Ministry and the Lebanese Petroleum Administration in October that the long-awaited first appraisal well it spud in September on Beirut’s Qana prospect (Block 9) turned up dry, according to Lebanese media.
Lebanon’s leading television station and news site, Lebanese Broadcasting Corporation International, reported that drilling stopped when water was encountered at a depth of 3900 m.
TotalEnergies has a 35% operator interest in Block 9 with participating interests held by partners Eni Lebanon BV (35%) and QatarEnergy International Investments LLC (30%)
The French major had awarded Transocean with a “a one-well contract at a rate of $365,000 (per day) plus three one-well options at rates that may vary between $350,000 and $390,000,” according to Transocean’s quarterly fleet status report.
But no decision has been announced to date as to whether TotalEnergies will exercise any of the options for additional wells. Transocean’s most recent fleet status report shows the rig in question (Transocean Barents) moving to the Black Sea in 2025.
Lebanon has, however, tendered blocks 1, 2, 3, 4, 5, 6, 7 ,8 and 10 in its sector under a 3rd licensing round that closes on 2 July 2024, according to the Lebanese Petroleum Administration.
The consortium of TotalEnergies, Eni, and QatarEnergy submitted bids on Blocks 8 and 10 during a previous 2nd bid round but had failed to sign by the 16 February 2024 deadline. The blocks were passed into a 3rd round, according to a LinkedIn post by Wissam Chbat, board member of the Lebanese Petroleum Administration.
