Cyprus grants extension to Total's natural gas exploration concession

The Cypriot government granted a two-year extension on the natural gas exploration license for energy giant Total for an offshore field, a spokesman said on Thursday.

"The Council of Ministers accepted a request by Total for a two-year extension of it's license in block 11 of Cyprus's exclusive economic zone," deputy government spokesman Victor Papadopoulos said.

He said the block had to be redrawn as Total was obliged by its original contract to cede back to Cyprus one quarter of its concession because it had failed to carry out an exploratory drilling within the prescribed period.

Total had decided to pull out of gas exploration in Cyprus's offshore fields after it said it had failed to identify potential targets for drilling.

But its interest was revived after Italy's Eni discovered a well containing 30 trillion cubic feet of natural gas in Egypt's Zohr field adjoining Total's concession.

The Zohr gas deposit was found in a geological formation of carbonate layers in the bedrock which had not previously been considered as potential natural gas reservoirs.

Similar geological formations were reportedly detected by Total in the northern part of its block 11 off Cyprus.

Cyprus's Energy Minister Yiorgos Lakkotrypis has said that Total had even asked for the return of block 10 which it had abandoned and for a concession of block 9, which are along the Egyptian marine boundaries.

This aspect of Total's request has not been considered by the Council of Ministers because the Attorney General has been asked to provide legal advice on whether such a move is allowed without prior open bidding.

Total's original license in block 11 expires in February 2016. Local media said Total plans to carry out an exploratory drilling during its new two-year contract in the summer or in the autumn of 2016 at the latest. Endit