ExxonMobil, QatarEnergy get drilling ops with Valaris rig underway as Cyprus and Egypt sow the seeds of energy bonds

Two energy giants, U.S.-headquartered ExxonMobil and Qatar’s QatarEnergy, have fired the starting gun on drilling activities off the coast of Cyprus, using one of the drillships owned by Valaris, an offshore drilling contractor.Meanwhile, Cyprus is working on laying the groundwork to develop its resources and energy ties with Egypt.

The Ministry of Energy, Trade and Industry disclosed on January 24, 2025, the start of drilling operations on the Elektra-1 prospect, within Block 5 of the Exclusive Economic Zone (EEZ) of the Republic of Cyprus.

These activities are being undertaken with the Valaris DS-9 drillship by a joint venture (JV), encompassing ExxonMobil Exploration and Production Cyprus, the operator of the JV, and QatarEnergy International E&P, which holds a hydrocarbon exploration license for the block.

According to Cyprus’ authorities, the drilling operations will be monitored in real time by personnel from the Hydrocarbons Service of the Ministry of Energy, Commerce, and Industry.

These drilling activities come shortly after ExxonMobil confirmed a new gas discovery in the western region of the Mediterranean Sea, off the coast of Egypt, which was made with the same drillship, currently drilling the Elektra-1 prospect.

While ExxonMobil exercised a six-month-priced option for the Valaris DS-9 drillship, which began in January 2025 in direct continuation of the existing firm program, the U.S. giant has two more six-month extension options to prolong the rig’s drilling assignment.

The cooperation between Cyprus and Egypt in natural gas transmission infrastructure and the commercialization of gas fields in Cyprus’ EEZ was the main topic of discussion during a meeting in Nicosia between George Papanastasiou, the country’s Minister of Energy, Commerce, and Industry, and Karim Badawi, Minister of Petroleum and Mineral Resources of the Arab Republic of Egypt.

The two ministers exchanged views on ways to strengthen the energy security of Cyprus and Egypt, with an emphasis on cooperation in joint infrastructure projects for the transportation of natural gas, especially from the Cronosdiscovery in Block 6. The duo believes this infrastructure could form part of a new energy corridor from the Eastern Mediterranean to Europe.

In addition, the infrastructure would be used to accelerate the commercialization of Cyprus’ natural gas fields by transporting gas from the Cypriot EEZ to Egypt for liquefaction and exports to international markets.

Nikos Christodoulides, President of Cyprus, and Abdel Fattah Saeed Hussein Khalil El-Sisi, President of Egypt, plan to sign an agreement for the Kronos field on February 17, concerning the commercial exploitation of the field, with Egypt assuming the role of the host country for the natural gas.

A memorandum of understanding (MoU) between Cyprus, Egypt, and the management company for the Aphrodite fieldwill also be inked on the same date.

During the meeting with Badawi, other energy issues were also discussed, such as Egypt’s use of the Prometheus floating regasification unit. These agreements are said to mark an important step in the energy cooperation between the two countries.