Gas rig in the Mediterranean
Gas rig in the MediterraneanIsrael news photo: Flash 90

Gas reserves off Cyprus are nearly a third less than initially estimated but remain "substantial,"  the country's energy minister said Thursday, according to the AFP news agency.

Energy Minister George Lakkotrypis said test data from a confirmation drill by the U.S.-Israel firm Noble Energy showed the natural gas discovery in Block 12 ranges from 3.6 trillion cubic feet to 6 tcf with a mean of 5 tcf, falling short of a Noble estimate in 2011 of 5-8 tcf, with a mean of 7 tcf.

Lakkotrypis insisted, however, that the assessment "confirms there are substantial deposits of natural gas with significant possibilities of production."

"Every half a trillion cubic feet of natural gas represents 25 years of power supply for the Cyprus electricity authority," he said, according to AFP.

He said the results would not deter the government from going ahead with the building of a liquefied natural gas (LNG) plant for its offshore gas, as there are other blocks to be exploited.

A second appraisal well will meanwhile be required to specify the quantity in Block 12.

Noble Energy began confirmation drilling off the southern shore of Cyprus in June to ascertain whether there is enough untapped gas to make the LNG venture commercially viable.

Cyprus has signed a memorandum of understanding with a U.S.-Israeli partnership to build the LNG plant to exploit untapped energy wealth.

Israeli firms Delek Drilling and Avner Oil Exploration each own 15 percent of the U.S. project.

The almost bankrupt Mediterranean island is hoping its untapped offshore energy resources can pull it back from the financial brink after a banking meltdown earlier this year that prompted an EU-IMF bailout.

Cyprus is hoping to commercially export its gas, and maybe oil, by 2020.

The eastern Mediterranean has been a hive of exploratory activity, with Cyprus granting permits to international prospectors after Israel discovered massive offshore gas deposits in 2010.

Noble Energy made the first find off Cyprus's southeast coast in 2011 near the Israeli maritime boundary, in a test well named Aphrodite-1.

Based on a preliminary 4.5 tcf assessment of reserves by Noble, the government expects a profit of $12-18 billion over a 14-year period, Lakkotrypis said.

Earlier this year Cyprus signed additional agreements with French energy giant Total and a consortium deal with Italy's ENI and South Korea's Kogas for oil and gas exploration.

Cyprus and Israel have gotten closer as Israel has made an effort to tighten its ties with both Cyprus and Greece over the past few years, particularly in light of Turkey's growing hostility and movement towards radical Muslim elements in the region.