Eni, Korea Gas sign deal for Cyprus exploration

Eni SpA has won three exploration blocks off the coast of Cyprus, marking the biggest Italian oil company’s entry into the search for resources in the eastern Mediterranean island’s waters.

The company and partner Korea Gas Corp signed contracts for blocks of about 12,530 square kilometers in the deep part of the Levantine basin off the south coast, Rome-based Eni said on Thursday in a statement.

It holds 80 percent of the joint venture deal and Kogas the balance. “The result is of significant importance for consolidation of Eni’s position in the Mediterranean region, which is a strategic area” for the company, it said in the statement.

Cyprus is attracting industry interest after US explorer Noble Energy Inc said in 2011 it found as much as 8 trillion cubic feet of gas off the southern coast. The blocks, 2, 3 and 9, awarded to Eni are near the Noble Energy discovery, according to Minister of Commerce, Industry and Tourism Neoklis Sylikiotis.

Companies in the region need to deal with a territorial dispute between Turkey, which occupies the northern part of the island, and the Greek-Cypriot government. Turkey, which has urged Cyprus to freeze oil exploration because it claims some areas are in Turkish territory, sent warships to the area following drilling by Noble in 2011. [Bloomberg]

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