Chevron Corp, Shell PLC and NewMed Energy LP have sanctioned pre-construction works for the delayed Aphrodite natural gas field development offshore Cyprus.
“[T]he partners in the reservoir adopted a decision on commencement of FEED [front-end engineering design] for the production systems and the transmission infrastructure in the sum of approx. $105.7 million”, NewMed Energy, owned by Israel’s Delek Group, said in a stock filing.
Meanwhile negotiations continue between the consortium and the Cypriot and Egyptian governments about exporting output to Egypt, NewMed Energy added.
Early this year Nicosia approved a $4-billion updated development plan, following failed talks on cost-saving changes to the original terms approved by the government November 2019, according to a regulatory disclosure by NewMed Energy February 15, 2025.
“Concurrently, an amendment was signed between the partners and the Cypriot government to the PSC [production sharing contract], in the context of which the partners undertook, inter alia, to adopt a final investment decision in 2027”, the February announcement said.
Along with the approval of the new plan, Cyprus also revoked a notice of breach issued August 2024 over the co-venturers’ failure to launch a FEED, a milestone agreed in the PSC, according to the February announcement.
The new plan envisions four initial production wells to be connected to a floating production unit with a capacity of about 800 million cubic feet a day, which would be shipped to Egypt via a subsea pipeline, according to that announcement.
On February 17 NewMed Energy announced a non-binding memorandum of understanding (MOU) involving the consortium, the government of Cyprus and Egypt, and state-owned Egyptian Natural Gas Holding Co (EGAS) about sale arrangements and the construction of the required transmission infrastructure.
“According to the MOU, EGAS shall serve as the sole buyer of the natural gas produced from the reservoir, while the partners shall be granted an option to purchase specific quantities of the gas that is sold to EGAS as liquefied natural gas”, NewMed Energy said then.
Chevron operates Aphrodite, which sits on Block 12, with a 35 percent stake through Chevron Cyprus Ltd. Shell PLC’s BG Cyprus Ltd also holds 35 percent. NewMed Energy has the remaining 30 percent.
To contact the author, email jov.onsat@rigzone.com
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