The Israeli company New Med, which is involved in the management of the Aphrodite field in block 12 of Cyprus’s Exclusive Economic Zone (EEZ) alongside the American company Chevron and Shell, informed the Tel Aviv Stock Exchange a short while ago that the Cypriot Minister of Energy, Giorgos Papanastasiou, sent a letter to the three companies on August 25 informing them of their breach of the terms of the contract signed (revised) in 2019. The letter warns that the companies must remedy this breach within three months.
Failure to do so, Minister Papanastasiou warned, will give the Republic of Cyprus the right to terminate the licence and consequently revoke the partners’ rights to exploit the Aphrodite field.
This is a serious development, revealing difficulties in communication between the two sides regarding the implementation of the 2019 agreement, which amended an earlier agreement in favour of the companies.
According to New Med’s announcement (formerly Delek) on the Tel Aviv Stock Exchange, the Aphrodite consortium intends to submit an updated development plan (‘updated development and production plan’) for approval by the Cypriot Government in the coming days. This plan is based on the initial development and production plan previously approved.
The breach referred to by the Minister of Energy may be related to the consortium’s delay in promoting the detailed techno-economic study (FEED) within the agreed timelines, which is crucial for the future final investment decision (FID) regarding the exploitation of the deposit.
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