Greece Potentially Sitting On $600 Billion Worth Of Natural Gas: Report
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An underwater geological formation just off the Greek island of Crete could prove to be Greece’s economic salvation, claimed a report by Reuters on Wednesday, after a study predicted that it may hold up to $600 billion worth of natural gas – enough to clear the country’s debt and bring billions in annual cost savings.
An underwater geological formation just off the Greek island of Crete could prove to be Greece’s economic salvation, claimed a report by Reuters on Wednesday, after a study predicted that it may hold up to $600 billion worth of natural gas – enough to clear the country’s debt and bring billions in annual cost savings.
The study, which was presented to Greek Prime Minister Antonis Samaras in June and seen by Reuters, reportedly found geological similarities between offshore Crete and the prolific Levantine Basin (where recent Israeli and Cypriot discoveries are clustered); and said that it may hold an estimated 3.5 trillion cubic meters (Tcm) of natural gas, which would enough to cover over six years of EU gas demand.
Though the study authors admitted that it would take years to fully explore and develop any offshore gas sector, they expect the reserves to generate $599 billion in state revenues over 25 years, while reducing Greece’s dependence on energy imports – which cost about 5 percent its GDP this year.
[quote]“We feel this is a very conservative figure,” said one of the study’s co-authors Elias Konofagos, whose Athens-based company Flow Energy informally advises the government on energy strategy.[/quote]According to Reuters, another study published in the Journal of Environmental Science and Engineering in June estimated that there could be up to 4 Tcm of gas, and 3 billion barrels of crude oil, in the same location.
Unsurprisingly, the Greek government has already launched a licensing round to explore the site and has commissioned a seismic survey company to pin down the extent of hydrocarbon deposits. The results are expected in mid-2013.
Additionally, analysts say that, if the gas estimate proves accurate, Greece could also become a transit hub for gas to Europe, by establishing an exclusive economic zone to legally extract hydrocarbon, while working with Israel, Cyprus and Lebanon to combine exports via a joint pipeline.
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Nevertheless, the geologists also warned against placing too much hope on the estimates, as only drilling can truly determine the facts. Poland for instance saw its hopes of achieving energy self-sufficiency this summer fade away, after early estimates of shale gas reserves prove to be overly optimistic.
Petroleum geologist David Peace told Reuters that if the Greek estimates turn out accurate, more geological surveys may be done in the Mediterranean Sea, including studies by other troubled eurozone nations such as Italy and Spain.
[quote]”If you look at the offshore license map of Italy, about two-thirds of it is open…Italy is one area that has been overlooked, especially the south,” said Peace, noting that Italy has now relaxed a two-year drilling ban and has promised to reduce red-tape.[/quote]
