Turkey Suspends ENI Energy Deals over Cyprus Exploration
Turkey has suspended energy deals with ENI over the Italian firm's involvement in exploring for oil and gas offshore Cyprus.
According to a report from the Anatolia news agency Wednesday, Turkish Energy Minister Taner Yildiz said: "We have decided not to work with ENI in Turkey, including suspending their ongoing projects."
ENI is a partner in the Samsun-Ceyhan pipeline project that is intended to deliver Russian and Kazakh oil to Turkey's Mediterranean coast. But this year has seen the firm sign license agreements that gave it and its partner Korea Gas Corporation the right to explore for hydrocarbons in blocks 2,3 and 9 within the Republic of Cyprus's Exclusive Economic Zone (EEZ), in the western part of the Levant Basin.
ENI CEO Paolo Scaroni confirmed Wednesday that the oil pipeline project is on hold. "I am sorry over the reaction from Turkey and I am hopeful we will find an accord," Dow Jones reported him as saying.
Turkey has long-demanded that oil and gas companies involved in bidding and acquiring licenses offshore Cyprus withdraw from deals made with the Republic of Cyprus. Rigzone reported May 18, 2012 that Turkey had threatened reprisals against several major companies that had made applications for licenses in the Mediterranean island's waters.
Cyprus has been divided on ethnic Turkish and Cypriot lines since a brief war in 1974 and the prospect of oil drilling in the EEZ has renewed tensions between Turkey and the currently cash-strapped Republic of Cyprus.
Yildiz recently declared that revenues generated from drilling offshore Cyprus should be shared between the Republic of Cyprus and its Turkish-dominated neighbor in the north of the island. Other oil and gas companies that have deals with the Republic of Cyprus include Total and Noble Energy, which has already found up to nine trillion cubic feet of gas in the country's waters at its Aphrodite discovery.
Last week, in a bid to avoid a punitive bail-out deal from the EU and the IMF the Republic of Cyprus was rumored to have considered a proposal from Gazprom to allow the Russian company to explore for offshore gas in return for a package that would see small country's books balanced.
Cypriot waters are not the only part of the Levant Basin where there is potential for disputes and conflict. Lebanon and its southern neighbor Israel are both keen to develop offshore oil and gas in their respective portions of the basin, with the pre-qualification period to apply for Lebanese licenses set to end tomorrow (March 28, 2013).
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Total Starts Up Antwerp Refinery And Petrochem Complex After Upgrade (Nov 30)
- Hoegh LNG: Pakistan LNG Import Project Consortium Folds (Nov 16)
- France's Total Buys Engie's LNG Business For $1.5B (Nov 08)
Company: ENI more info
Operates 11 Offshore Rigs
- Italy Prosecutors Probe Eni For Tax Evasion At Refineries (Nov 22)
- Officials: BP, Eni Interested In Developing Iraq's Majnoon Oilfield (Nov 20)
- Eni's Giant Gas Field Prompts Egypt to End Imports in 2018 (Nov 15)
Company: Noble Energy more info
- US Shale Producers Promise both Higher Output and Returns (Nov 03)
- Fault at Israel's Tamar Gas Field Prompts Use of Dirtier Fuels (Sep 22)
- Leviathan Partners in Talks to Pipe Gas to Egypt Via Jordan (Aug 10)
Company: Kogas more info
- S. Korea's KOGAS Says Interested In US Shale Gas Projects (Feb 10)
- Total, Shell, Eni Eligible to Bid for New Iran Oil, Gas Projects (Jan 03)
- Eni Board Authorizes Investment for First Phase of Coral Discovery (Nov 18)