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It gives me great pleasure to address the 21st World Congress of Cypriots in Diaspora, welcoming, in my turn, our expatriates to Cyprus.
I would like to thank you and express my deep appreciation for your continuous efforts, each of you in your own field, to promote our Cyprus abroad, to promote, in the countries where you reside and internationally, the positions of the Republic of Cyprus on our national issue and, in general, for your steadfast and selfless love for our semi-inherited homeland.
I have been invited by the organisers of the Conference to brief you on issues related to the energy sector in Cyprus, which, especially during the difficult period we are going through, is key to the country's competitiveness. It is precisely for this reason that we have redefined our energy strategy, aiming to ensure low-cost electricity and, at the same time, to enhance the security of our energy supply.
The same objectives are, of course, shared by both European countries and our neighbours in the Eastern Mediterranean region, which, in our view, creates a business environment that favours, among other things, the development of the natural gas deposits discovered in the Cypriot Exclusive Economic Zone. In particular, in late 2021, early 2022, the consortium of ExxonMobil and QatarEnergy drilled an appraisal well in the "Glafkos" discovery, in Block 10, in which a drill stem test was carried out, confirming the existence of a natural gas reservoir of excellent quality. Recall that at "Glaucus" a gas reservoir initially estimated between five to eight trillion cubic feet was announced in February 2019.
The same consortium also carried out a 3D seismic survey in Blocks 5 and 10 to identify new potential targets and/or to mature existing ones. At this stage, the data collected is being evaluated and we now await the results both in terms of the "Glaucus" discovery and its development, and for subsequent drilling in these blocks.
During 2022, two exploratory wells were also drilled by the joint venture of Eni and TotalEnergies, in Block 6, which led to the discoveries "Kronos" and "Zeus", with initial estimates of natural gas quantities amounting to 2.5 trillion cubic feet and 2 to 3 trillion cubic feet, respectively. Combined with the "Calypso" discovery in the same block in 2018, a cluster of discoveries has been established in the region, which is expected to help accelerate their development. The consortium is currently working on the appraisal of the three discoveries and, in this context, is planning an appraisal well on "Kronos" around late 2023, early 2024.
At the same time, last July the A3 appraisal well on the "Aphrodite" field, in Block 12, successfully completed by the licensed consortium of Chevron, Shell and NewMed Energy. This is the second appraisal well in Aphrodite, which was the first field discovered in our EEZ in 2011. We knew until now about confirmed gas quantities in Aphrodite in the order of 4.5 trillion cubic feet and the indications we have from the new appraisal well, drilled this time in the centre of the field, are quite encouraging.
The next step for Aphrodite is to arrive at a final Development and Production Plan for the field, based on the revised text submitted by the consortium to our Ministry in June 2023. According to the consortium, the purpose of the revision is to optimise the Development Plan by exploiting synergies with other infrastructure located in Egypt.
The Ministry of Energy is carefully studying the consortium's proposal and we will soon proceed with the necessary consultations, if necessary. In any case, the final approval of the Development Plan will come from the Republic of Cyprus.
On the remaining licensed blocks in the EEZ of Cyprus, let me inform you that our Licensees are proceeding with their exploration program, which is expected to culminate in the next 2-3 years with new exploratory drilling that we hope will lead to new discoveries, increasing the energy potential of our country.
The ongoing energy crisis, but also the adoption of new, more ambitious targets by the European Union aiming at climate neutrality by 2050, now require the acceleration of the transformation of our energy sector. Therefore, the ongoing revision of our National Energy and Climate Plan should reflect the increased ambitions stemming from the REPowerEU and Fit for 55 reform packages, looking towards a competitive low greenhouse gas emission energy system. This system will facilitate and encourage energy saving, further penetration of RES and adoption of circular economy practices.
In this direction, important measures and reforms have already been launched, with the national Recovery and Resilience Plan "Cyprus _ Tomorrow" providing that 41% of the total funds budgeted for the country will be used for green transition purposes.
During the 2021 - 2027 Programming Period, the Ministry of Energy, Trade and Industry has secured about 590 million euros, which will be used mainly for granting financial incentives to households, businesses and public entities for investments in energy efficiency and renewable energy sources. At the same time, we are working to modernize the legislative and regulatory framework of the energy sector, as well as our administrative procedures, having, among other things, proceeded with the establishment of the Single Service for the licensing of renewable energy projects, which is already operating under the Business Facilitation Unit of our Ministry.
I would like to mention in relation to the Single Point of Service that the operation of the online platform for digital submission of applications was recently launched, while the digitalisation of the process for the examination and approval of the required permits will be completed within 2024.
Undoubtedly, the penetration of RES in electricity generation in Cyprus is particularly difficult due to the small and isolated size of the market, the absence of electricity storage systems and the seasonal demand. At the same time, our island is still largely dependent on imported oil products, which makes the Cypriot economy much more vulnerable than those of other countries to fluctuations in the international oil price.
The above challenges make it vital to enhance the security of the country's energy supply, the removal of its energy isolation and the operation of the competitive electricity market and the internal gas market. This interconnection will bring about the end of our country's energy isolation, contribute to the achievement of strategic autonomy in the energy sector and enhance the penetration of RES in our electricity mix.
In addition, €40 million have been secured from European funds to promote electricity storage systems, as well as around €120 million for the expansion, upgrading and digitalisation of networks, including the massive deployment of smart meters.
Regarding the internal gas market, our Ministry is intensifying efforts to implement the LNG import terminal at Vasilikos and, in parallel, the supply of gas for power generation purposes by pipeline from Eastern Mediterranean fields. To this end, we have taken initiatives both at state level (e.g. Israel) and at the level of hydrocarbon and electricity companies, to create the necessary infrastructure, such as a gas transmission pipeline in Cyprus and a modular or floating liquefaction terminal.
These infrastructures will provide the incentive needed by gas producers in the Eastern Mediterranean to use them and transport it to our country as an alternative for use in local conventional power generation and for export. In addition to reducing costs and enhancing our energy security, independent electricity producers will be given the opportunity to operate, creating competition in the electricity market, reducing greenhouse gas emissions in electricity generation and allowing the necessary flexibility in conventional generation to further promote RES.
As you can see, the energy sector in Cyprus is currently facing major challenges, the successful management of which is largely a prerequisite for In this direction, it is imperative that we work collectively to develop and implement a long-term, comprehensive and sustainable energy strategy, on the basis of which we will accelerate Cyprus' green transition, effectively addressing both the growing threat of climate change and the ongoing energy crisis.
You, our expatriates, with your valuable knowledge and experience from your sectors of activity abroad, with your international connections and with your business initiatives, can make a major contribution to our efforts.
I wish you every success in the proceedings of the 21st World Congress of Diaspora Cypriots and thank you for your attention.
I am at your disposal for any clarifications or questions you may have.
(OP/EXP)
Contents of this article including associated images are belongs PIO
Views & opinions expressed are those of the author and/or PIO
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