Uncertainty is growing concerning the prospects of hydrocarbon exploration in Greece with larger players pulling out of land exploration, while at the same time, recent statements from Foreign Affairs Minister Nikos Dendias raised more doubts about offshore exploration near the island of Crete.
In particular, after the recent departure of Repsol from two projects, now Hellenic Petroleum (ELPE) seems to be looking at withdrawing from two land exploration sites. The company is considering the departure from the areas "Arta-Preveza" and "NW Peloponnese ", where the group is the exclusive tenant, as well as from a sea plot West of the Gulf of Patras, where it has a 50 percent stake. The group is said to be unhappy with the delays by the state in the search for hydrocarbons and is also concerned about reactions from local communities.
The group is also present in other plots ("Kyparissiakos Gulf-block 10, West and Northwest of Crete, Block 2 West of Corfu) but is not reassessing these projects as they are considered to play a critical role in its search for hydrocarbons.
A blow to the country’s hydrocarbon extraction plan came a few months ago with the withdrawal of Repsol from the block of Etoloakarnania and Ioannina, leaving a question mark about its moves in the Ionian Sea.
Energean, on the other hand, has given a vote of confidence in the research program while remaining in Etoloakarnania and Ioannina and looking for a new partner there after the last extension to complete the first phase of the basic research phase.
ExxonMobil, which participates in the joint venture with ELPE, is also in a difficult position, amidst questions about whether it will stick with the project in this economic climate. ExxonMobil has significantly reduced its assets and is making drastic cuts in capital spending by 2025. Total losses in 2020 exceeded $22 billion.
The pandemic has brought ups and downs in hydrocarbon exploration worldwide as oil prices have come under increasing pressure, and many companies and states have turned to green investments, seeking to change their energy mix with greater RES penetration. Especially in Europe, the goals set by the EU for the transition to "green" energy raises doubts about the support that gas projects may have.
Additional questions were raised by recent comments from Dendias in an interview with Arab News where he stated that "Greece is not going to start digging to the bottom of the Mediterranean to find gas and oil. It takes 10 to 20 years to find and exploit it. Greece does not plan to become an oil and gas producer in the near future."
In a statement that caused a stir in the market, many saw the comments as indicating that Greece may cancel exploration plans south of Crete due to challenges from Turkey over sovereignty to the region. This was denied by ministry officials who said that Greece’s energy program remains intact.
Encouraging messages, however, are coming from France’s Total. The company, although it recorded large losses in 2020, does not intend to change its hydrocarbon exploration program in the two offshore plots west and southwest of Crete and the start of seismic surveys has been set for the end of this year or early in 2022.