The Energy Sector is Not Only About the LNG Plant

lngDespite the economic woes which cast upon Cyprus the haircut on deposits, also known as ‘bail-in’, the Cypriot economy has demonstrated remarkable resilience. The scheduled drilling programme for hydrocarbons in blocks 2, 3, 9, 10 and 11― beginning in late 2014 ―could well nudge the economy out of the slump.

Until then, there are constructive things that could be done to spur growth and contain the scourge of unemployment. Within three years from signing the contracts with the Republic of Cyprus, in early 2013, companies are scheduled to spud at least five exploratory wells. If we add to this another three appraisal wells, it is expected that about eight offshore wells in all will be completed.

Given that the cost per offshore well comes to $100m― a conservative calculation ― the value of investments that will be channelled into Cyprus is expected to reach $800m. But the real question is what proportion of these investments will diffuse into the real economy? Put differently, how can Cyprus best take advantage of this juncture through job creation? Read more

Cyprus and Norway sign double taxation agreement

tax treaty 1Cyprus and Norway have signed an Agreement on the Avoidance of Double Taxation and the Prevention of Tax Evasion, concerning Income Taxes, as well as a relevant Protocol.

The Agreement was signed at the Ministry of Finance in Nicosia between Minister of Finance Harris Georgiades and Norwegian Ambassador to Cyprus Sjur Larsen.

In statements, Georgiades said such agreements were important for the further expansion of commercial and financial relations with significant economies, such as Norway.

He said the effort to update, maintain and expand the network of double taxation agreements was one of the most important pylons in the government’s policy. Read more

Cyprus´ banks face continuing economic turmoil

neo 15On Jan. 30, the Bank of Cyprus announced it would release a 900 million-euro ($1.2 billion) tranche of frozen deposits. Two days earlier, Cypriot President Nicos Anastasiades returned from a visit to Qatar during which he said the capital controls in place would likely be lifted in the near future. The capital controls, which were implemented in March 2013, have been gradually loosened over the past year, and a further relaxation of certain restrictions is likely over the coming months.

However, considering the poor state of the Cypriot economy and financial sector, it is unlikely that the restrictions will be completely lifted, and the high number of nonperforming loans will cause greater distress. As a result of weak Cypriot banks there will be little credit growth, and the debate over how to deal with nonperforming loans is likely to lead to political and social instability. Read more

John Tomich: Emerging Picture in Cyprus is Very Exciting

tomCyprus gas discovery underpins Noble’s long-term profile in region.

Noble Energy’s activity thus far in the Eastern Mediterranean, John Tomich, the company’s Cyprus Country Manager, recently explained that discovery of hydrocarbons in Cyprus’ Exclusive Economic Zone (EEZ) will serve to underpin the gas giant’s long-term profile in the region.

Natural Gas Europe reports how Noble entered Israel in 1998 and made its first discovery offshore in the early 2000s: 1 trillion ft³ (tcf) of natural gas in Mari-B. – “Basically, it started the Israel natural gas industry,” he said, “And led to significant market penetration for natural gas for electric power generation in Israel.”

Noble, he explained, had drilled a number of wells after that and made additional discoveries, but the next major milestone was in 2009, when the company discovered the Tamar gas field, roughly 10tcf of gas; the next year, Noble drilled the Leviathan, which was close to 20tcf. Read more

Gabriela Guellil: Cyprus Has to Attract Investors

gabiBilateral relations between Cyprus and Germany are getting stronger day by day, the German Ambassador to Cyprus, Dr. Gabriela Guellil, has stated in an interview with the Cyprus News Agency (CNA).

Covering a range of topics, Guellil underlined that the implementation of the economic adjustment programme will help Cyprus to stabilise the financial sector, to modernise its administration, and to become a trustworthy and competitive economic player again. – Moreover, the discovery of hydrocarbon reserves in the Exclusive Economic Zone (EEZ) of Cyprus can, and should, serve as a catalyst for the creation of conditions that will enhance a just and viable solution of the Cyprus problem.

Expressing satisfaction with the fact that Cyprus is receiving a lot of acknowledgement by its international lenders, the Troika, during its evaluation missions, Guellil credited the Government of Cyprus for taking all necessary measures to restore the confidence in the international markets. Read more