An untold treasure awaits us to mine from the Greek seabed
An untold treasure awaits us to mine from the Greek seabed
Eastern Mediterranean hydrocarbon basins
In the Eastern Mediterranean basin, which has an area of 1/3 of Saudi Arabia (figure 1), according to reasonable estimates, an untold treasure is hidden. Geographically it is divided into three compartments: The first compartment is the Levantine basin and includes the EEZs of Syria, Lebanon, Israel and the eastern part of the Cyprus EEZ (plots 2, 3, 9, 12 and 13).
In this basin, mainly in the Israeli EEZ, 460 wells were drilled and natural gas deposits containing 1,5 trillion M3 (cubic meters) of natural gas and 3 billion barrels of oil were found. In this area, the US Geological Survey estimates that there are another 3,5 trillion M3 of natural gas. Correspondingly, the Israeli Geological Survey estimates that there are another 8 trillion M3 of natural gas and 26 billion barrels of crude oil.
The second compartment includes the Nile Cone, which exclusively includes Egypt’s EEZ. In this compartment, approximately 1900 wells were drilled and 1,8 trillion m3 of natural gas was found, not including the “Zor” deposit, which geologically belongs to the third compartment. The US Geological Survey (USGS Technical Report 2010) estimates that there are another 9 trillion m3 of natural gas in this compartment.
The third section includes the Mediterranean Ridge area. The Mediterranean Ridge starts from the Gulf of Kyparissia in Greece and ends at the Trough of Eratosthenes, i.e. south of Limassol in Cyprus. It essentially includes 3/4 of the Cypriot EEZ, a very small part of the Egyptian EEZ, where the “Zor” deposit is located, the entire area south of the Dodecanese and the entire Libyan Sea (southern Crete and the Libyan Sea).
In this area, exploration began in September 2015. Three wells were drilled in coral reefs, namely in “Zor” (Egypt) and “Onisiphorus” and “Kalypso” (Cyprus). 1,1 trillion m3 of natural gas were found. A tremendous success. In this virgin area located west and southwest of Crete, 16 coral reef targets with exactly the same characteristics as the coral reefs in which deposits were discovered in Egypt and Cyprus were also identified by the work of PGS and EDEY (Hellenic Hydrocarbon Management Company).
The area of the reefs amounts to 3.310 km2. “Zor” with a reef area of 100 km2 has 0,8 trillion. M3 of natural gas. Given that the coral reefs are very similar, if we have the same completeness, which the drilling will show, the expected reserves should be in the order of 26,48 trillion. M3 of natural gas. If we add the reserves of the Gulf of Kyparissia of 0,5 trillion M3, then the total according to the calculations should amount to 27 trillion M3.
An untold treasure in the Eastern Mediterranean
The very probable natural gas reserves of the Eastern Mediterranean basin – according to estimates – total 48 trillion m3. The distribution by country is as follows:
- Greece 27 trillion M3.
- Cyprus (according to Spectrum) 4 trillion M3
- Israel (according to its own Geological Survey) 8 trillion M3
- Egypt (according to the US Geological Survey – USGS Technical Report 2010) 9 trillion M3.
It is noted that the natural gas reserves in the intermediate area between Crete and Cyprus, namely south of the islands of Kasos, Karpathos, Rhodes and Kastellorizo, are not included. The natural gas reserves that exist in the Ionian Sea, inland Western Greece and in the Thermaikos are also not taken into account. 80% of these quantities are exportable to Europe, the Far East and the USA, although the latter seems impossible at the moment.
The above estimates do not include the natural gas deposits that exist in the Gulf of Sirte and very close to the offshore plots southwest of Crete. The exploitation of these deposits will be undertaken by the joint venture of ExxonMobil, Total and Hellenic Petroleum. This quantity of 48 trillion M3 of natural gas makes the Eastern Mediterranean basin the largest natural gas basin in the world.
Companies conducting exploration in Cyprus and Greece. Quantities of natural gas that can be channeled from Greece to Europe and Asia
If the estimates are confirmed, the natural gas reserves of Cyprus and Greece amount to 31 trillion M3. This will be proven by the drillings when they are carried out by the companies (figure 2). For comparison purposes and because the cubic foot is also used as a measure, we note that one M3 is slightly more than 35,315 cubic feet.
Potential competitor to Russia
If the estimates are confirmed in practice, the fact that a very large part of these quantities of natural gas will prospectively go to the European market makes us potential competitors of Russia. More specifically, the area of the 10 targets in the two huge plots of land that have been granted to the ExxonMobil, Total and HELPE consortium is 2.000 km2 (the size of the prefecture of Chania), i.e. 20 times larger than the target of the “Zor” field.
If these targets have the same natural gas content as the targets of the “Zor” and “Calypso” fields, then the expected quantities will be in the order of 16 trillion m3, i.e. more natural gas than the combined EEZs of Egypt and Cyprus. Still according to the estimates, the worst-case scenario is that the quantities of natural gas in these two areas amount not to 16 trillion m3, but only to 2 trillion m3.
Let us also assume that the quantities of natural gas in block 10 (Kyparissia Gulf (the rights are held by the Hellenic Petroleum-Edison consortium) are 0,5 trillion M3 and in block 2 west of Corfu (a joint venture of Total, Edison and Hellenic Petroleum) are 0,3 trillion M3. If the companies' estimates are valid, in the future we will be able to export 45 billion M3 annually to the EU for at least 35 years (figure 2).
Natural gas liquefaction station in Gavdos with the aim of exporting it by LNG ships
The remaining quantity of 1,2 trillion M3 will allow us to export another 40 billion M3 per year for 30 years in the form of liquefied natural gas. One idea is to liquefy in Gavdos (figure 3) and export it by LNG ships around the world. This is the solution that ExxonMobil and QatarOil are aiming for for Cyprus' natural gas.
Huge investments
The investments needed to bring the fields into production are enormous. For each reserve of 1 trillion m3 of natural gas, investments of around $4 billion are needed. If all 16 targets shown by EDEY under Crete have the same natural gas content as the “Zor” field, then the investments that the companies will make to bring the fields into production exceed $100 billion.
The government talks a lot about investments, but the great growth in Greece will come from investments that will be made mainly in the fields. This size of investment can only be afforded by very large oil companies, expecting, of course, multiple profits. The quantities of natural gas that can be channeled to Europe from EastMed, if the plan is implemented, the TAP and the so-called Central-Med will amount to 75 billion M3 per year (figure 4).
Natural gas pipelines transporting 75 billion M3 per year to Europe from Azerbaijan, Eastern Mediterranean countries and Greece
This quantity can easily be increased to 100 billion M3 per year, covering the future needs of the EU. It may be that at the present juncture, due to the pandemic, demand has fallen, dragging down prices, but when we return to normality, we will return to steadily increasing demand. In his statements on 12/02/2018, Commissioner Miguel Cañete had estimated the increase in the EU's needs for natural gas from 70% to 83% by 2040, i.e. a further increase of approximately 100 billion M3 per year.
Deeper and oil fields
Beneath the natural gas deposits of Crete, which are found in the first 4.000 meters (Miocene), there are – in line with what Israeli geoscientists expect – also deposits of other hydrocarbons. These are mainly gaseous hydrocarbons and crude oil at greater depths and in the sediments of the Oligocene, Eocene, Paleocene, and all sediments in the Mesozoic Era (figure 5).
Hydrocarbon deposits that may exist under Crete in addition to natural gas
If in the Israeli EEZ they believe that in the Mesozoic sediments there are 26 billion barrels of crude oil, then proportionally, because we are in the same basin, there must be perhaps 75 billion barrels under Crete. This possibility should be the subject of new geophysical surveys by the Hellenic Geophysical Research Institute.
If, therefore, it is confirmed by drilling that the natural gas reserves in Crete are in the order of 27 trillion M3, then the value of the deposits – based on prices that applied in normal periods – will be in the order of 7 trillion dollars. Based on the Maniatis law (4001/2011), 20% of the value of the deposits is taken by the public sector, i.e. approximately 1,4 trillion dollars, and 5% of the value is taken by the region, i.e. 350 billion dollars.