Cyprus authorities have threatened to terminate the contract with 3 major energy companies involved in the development of the Aphrodite gas field in the Eastern Mediterranean, reports the newspaper Phileleftheros.
The Israeli company NewMed Energy has informed the Tel Aviv Stock Exchange about this threat. On August 25, the Cypriot Minister of Energy, Trade and Industry, Yorgos Papanastasiou, sent NewMed, the US company Chevron and the UK Shell a letter saying that all 3 companies were given 3 months to remedy the violations of the terms of the original contract, which was changed in 2019 in favor of the interests of the foreign members of the consortium.
The Cypriot minister made it clear to the parties that failure to comply with this condition would give official Nicosia the right to revoke the license issued to the consortium and thus deprive the partners of the rights to develop the field.
In this regard, NewMed announced that the consortium intends to submit an “updated development and production plan” in the coming days. This plan is based on the terms included in the original version of the contract.
Phileleftheros, for its part, suggests that the claims of the Cypriot authorities may be related to the fact that the consortium did not complete the design and study (FEED) work within the agreed time frame. According to the island state, this circumstance may negatively affect the future Final Investment Decision (FID) regarding the exploitation of the Aphrodite gas field.