Energy shifts lead Chevron to Greece

Three factors led Chevron to express interest in Kyparissiakos: the U.S. presidential inauguration, new sanctions on Russian hydrocarbon exports, and the drone attack on Turkstream's facilities in Russia. Russia and Ukraine are attacking each other's oil facilities, jeopardizing the region's energy supply security. The Turkstream pipeline, with a capacity of 31.5 Bcm, supplies Turkey with 14 Bcm and Greece and Central Europe with 17.5 Bcm, covering 50% of Greece's energy needs. Consequently, there is a risk of sabotage to the underwater cables and pipelines in the Black Sea at a time when calm in Turkey-Greece relations is necessary. The new sanctions of 2025, the inability of the U.S. to quickly increase LNG exports, cold weather events in Europe, and the reduction of Russian oil exports by 2-2.5 million barrels per day are driving global oil prices up. Natural gas prices in Europe are rising, with exporters preferring higher selling prices, and recent U.S. LNG shipments are heading to Europe instead of Asia. U.S. LNG exports to the EU will not significantly increase before 2027, resulting in the EU continuing to import Russian natural gas. After 2027, new regasification terminals are expected in the Gulf of Mexico and the eastern coast of the U.S.

Under these conditions, Greek policy is adapting to the new U.S. strategy, and Greece will soon launch a new tender for the South Ionian region, despite contrary announcements in January 2023 and April 2024. The tender completion process will take about a year, with 2-3 years for the initial research phases and an additional third phase lasting another 2 years. For a successful discovery, the overall timeline ranges from 6 to 7 years unless urgent situations compress the phases into two years. Undoubtedly, Chevron possesses significant expertise in deepwater research and production technology and is already present in the Eastern Mediterranean. However, the geophysical data from 2013 and other recent data are sparse, and the targets are at great depths. New, denser, and three-dimensional data are needed, as pointed out by HHRM (Hellenic Hydrocarbon Resources Management) back in 2018-19. Additionally, the 11,000 square kilometers of the region are cramped, close to the National Marine Park, and require a new Strategic Environmental Study, indirectly affecting the oil production programs of Katakolo and the drilling of the Patraikos Gulf, which have cost significant resources for Energean and Hellenic Petroleum.

"TA NEA Energy Supplement February 15, 2025"   Yannis Bassias  Translation from Greek