Eni awards $1.8bn in contracts to kick off Cyprus’ first gas project
Italian energy major signs key deals for Cronos development, targeting first gas in 2028.
Italian energy major Eni has locked in the main engineering, procurement, construction, and drilling contracts for the Cronos gas development offshore Cyprus, marking the start of the project’s execution phase in Block 6. The contracts, valued by local media at around $1.8bn, were signed with eight major offshore contractors, setting the stage for Cyprus’ first hydrocarbon production by the first half of 2028.
Eni’s decision to fast-track the Cronos development has triggered a wave of contract awards, with each contractor taking on a specific role in the project’s execution.
TechnipFMC has been tasked with supplying flexible gas production lines, while Dalmine will provide gas export and monoethylene glycol pipelines. Oceaneering International will deliver subsea umbilicals and control systems, ensuring the seamless operation of the subsea infrastructure. Meanwhile, China Merchants Heavy Industry will design, construct, transport, and install the floating control unit, a critical component for managing the offshore operations.
Natural Gas
McDermott, a US-based offshore engineering contractor, secured a contract worth between $500m and $750m for offshore transportation, installation, tie-ins, and commissioning of subsea pipelines and equipment.
Petrojet, an Egyptian contractor, will construct a new onshore gas pipeline connecting the Zohr facilities in Egypt with the Damietta LNG terminal. This pipeline is essential for transporting the processed gas to the liquefaction plant, where it will be prepared for export. The drillship’s involvement underscores the technical complexity of the Cronos development, which targets four subsea wells in Block 6.
Halliburton, which secured a bundled well construction and completions contract in September, will handle drilling fluids, directional drilling, cementing, automation, and other well services. The company’s role is critical to ensuring the safe and efficient drilling of the subsea wells, which are expected to tap into resources estimated at more than 3 trillion cubic feet (Tcf) of gas initially in place.
The project’s fast-track approach leverages existing infrastructure, including the Zohr field in Egypt, to accelerate the timeline for first gas, which is expected in the first half of 2028. Once operational, the field is projected to reach a production plateau of up to 500 millionlion standard cubic feet per day (MMscfd), with the gas liquefied at the Damietta LNG terminal for export, primarily to European markets.
Contracts split across key offshore and subsea specialists: cronos gas project
Eni’s partner in Block 6, TotalEnergies, holds a 50% stake in the project, while Eni operates Block 6 and Block 8 and holds interests in Blocks 7 and 11.
The execution phase of the Cronos project was formally launched on October 26 at a ceremony in Nicosia, attended by Cypriot President Nikos Christodoulides and Energy Minister Michael Damianos. The event underscored the project’s significance for Cyprus, both economically and geopolitically. Eni’s press release outlined the scope of the awarded contracts: “The awarded contracts include floating control unit, transportation and installations, offshore sealines, subsea production system, flexible lines, umbilicals, onshore line EPC [and] drilling rig services.”
The Cronos development is expected to produce around 2.8lion metric tons per annum (MMtpa) of liquefied natural gas (LNG), which will be exported primarily to Europe. This aligns with Europe’s broader strategy to diversify its energy sources and reduce dependence on Russian gas, particularly in the wake of geopolitical tensions. The project’s success could pave the way for further hydrocarbon developments in Cyprus, with Eni and TotalEnergies already holding interests in multiple blocks in the region.
For the contractors involved, the Cronos project represents a significant opportunity to showcase their capabilities in the offshore and subsea sectors. The $1.8bn contract value underscores the scale of the project, which involves a complex web of subsea infrastructure, pipelines, and drilling services. The involvement of global players like McDermott, Baker Hughes, and Saipem highlights the project’s technical challenges and the high stakes involved in delivering first gas by 2028.
The next steps for the Cronos development include the completion of the subsea infrastructure, the installation of the floating control unit, and the drilling of the four subsea wells. Once these milestones are achieved, the project will move into the commissioning phase, with first gas expected in early 2028. The successful execution of Cronos could serve as a blueprint for future offshore developments in the Eastern Mediterranean, a region that is increasingly viewed as a key player in the global energy landscape.
Cyprus, the Cronos project is a critical step toward energy independence and economic growth. The country’s emergence as a gas producer could attract further investment in its energy sector, while the establishment of a regional gas hub could enhance its geopolitical standing. As the project progresses, all eyes will be on Eni and its partners to deliver on their ambitious timeline and unlock the full potential of Cyprus’ offshore resources.
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