ATHENS — Greece’s Prime Minister Antonis Samaras says the cash-strapped country could earn up to 150 billion euros ($206 billion) in three decades from offshore oil and gas deposits.
Samaras said the rough estimate, which is worth nearly half of Greece’s 320 billion-euro debt mountain, was “neither optimistic nor pessimistic,” and could increase depending on further exploration results.
He said surveys have provided “very strong indications of significant” reserves off Greece’s western coast, and work is ongoing in waters off the island of Crete in the south. Substantial findings would be a major windfall for a country that has been in recession now in a seventh year with harsh austerity measures creating record unemployment and deep poverty.
Greece has been forced to cut spending sharply, raise taxes and enact wide-ranging economic reforms to secure vital rescue loans after it nearly went bankrupt.
The government said despite a primary surplus of as much as 1.5 billion euros that it still wants to negotiate debt relief with the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) that is putting up $325 billion in two bailouts that will run out this year.
“There are very strong indications… that over the next 25-30 years, state tax revenue from (hydrocarbons) could reach 150 billion euros ($206 billion),” Samaras told reporters at the energy ministry. The potential windfall is believed to lie in the Ionian Sea and near Crete.
The gulf of Patras is thought to hold some 200 million barrels of crude oil, while another 50-80 million barrels are believed to lie near Ioannina and another three million barrels near Katakolo.
Greece in 2012 picked a Norwegian contractor to carry out seismic surveys in the Ionian Sea and south of Crete in search for oil and gas. Drilling contracts for the region are to be issued later this year.
“We are completing the concession agreements for the gulf of Patras and Ioannina, where the indications are strongest, and they will be tabled for ratification by parliament,” Samaras said.
State proceeds from the concession are to be used to support the country’s struggling pension funds, and for scientific research, Samaras said.
In June, 2013, Samaras said Greece planned to set up a national hydrocarbon company to prospect for natural gas and oil deposits in the Ionian Sea and the area south of Crete.
Samaras held a meeting with officials from Greece’s Energy, Environment and Climate Change Ministry (YPEKA) and experts where he said speeding up exploration for hydrocarbon deposits in Greece is one of the country’s greatest comparative and geopolitical advantages, NewsEurope reported at the time.
He said that Athens had formed “strategic alliances” with foreign exploration companies. International competitions were under way for exploration off Ioannena and Katakolo, and in the Gulf of Patra, he said, hailing the involvement of Greek scientists in efforts to tap the country’s energy potential necessary for development of natural deposits that may generate wealth.
Samaras called for the need that the Greek energy program become a part of the European Union’s networks, underlining its importance for the Greek economy and energy independence.
The Greek government hopes that the country will discover major oil and gas reserves, similar to the discovery in Cyprus’ block 12 by US Noble Energy. Cyprus granted concessions for natural gas exploration to ENI/KOGAS consortium in blocks 2, 3 and 9 within Cyprus’ EEZ and Total for blocks 10 and 11.
Exploration is also underway off Cyprus by international companies as government officials there are hoping for lucrative finds, although it could take years. Cypus also had to seek a bailout from the Troika after its state banks were brought to the edge of ruin by big holdings in devalued Greek bonds and through bad loans to Greek businesses that failed.