Five Ways for the "Third Corridor" by Cyprus
In a classified report that was leaked in the local press, the Cypriot regulatory agency for energy outlined five ways under which a third corridor can be achieved.
The report, produced after months of consultations with the stakeholders involved in Israel, Cyprus and Greece, was commissioned for the President of Cyprus who is presently negotiating for the second licensing process for assumed gas reserves offshore the island.
The report firstly mentions that Cyprus is steadily becoming a regional natural gas hub based on natural gas findings. Thus it firstly proposes that a land based LNG terminal should be constructed in the Vasiliko area, some 50 miles from where Noble Energy is currently pursuing its exploration process. Noble is said to be favorable to that option and has stated so numerously when in talks with the Cypriot President.
The regulatory agency, actually proposes that to be the main option. It continues by offering the option to construct a sub water pipeline that will export the gas to the Island of Crete in Greece, thereafter to Southern mainland Greece and finally the pipeline will connect with the pipelines envisaged for the Southern Corridor, most notably the Trans Adriatic Pipeline (TAP). Thus one axis will go to Italy and another route will continue to Bulgaria.
This option was recently proposed by Greece's DEPA which is actually lobbying in effect for that, according to statements of its managers and estimations by Greek experts. DEPA is drafting presently a viability research for that option that talks about a 8 billion cbm per annum pipeline from Cyprus with the ability to supply Bulgaria.
A third option proposed by the Cypriot agency is the creation of a floating LNG station and a fourth, is the construction of a combust natural gas (CNG) station in Cyprus, whereby the product will then be exported to Mediterranean markets from there.
Lastly the fifth option calls for the construction of a 2,000 MW natural gas powered station in Cyprus and the electricity produced will be exported in Israel and Greece via the so-called "EuroAsia cable", which envisages the interconnection of the electric market of Israel with that of the EU. A memorandum of cooperation was signed by these three countries recently. In that case the electricity production from Cyprus will be exported to Israel and/or Greece in exchange of the natural gas production available by the offshore field.
The energy agency also comments that amongst these five options there could be complimentary functions and also that the Israeli offshore fields should be also taken into account in all these plans, so a sot maximize the benefits for investments.
All in all, the options being discussed first and foremost depend on the availability of sufficient amounts of gas to be commercially available. Secondly, not all of them secure the diversification of EU natural gas supplies and thirdly it is of importance to estimate what exactly would be the strategies of other interested players such as USA, Russia and Turkey.