Athens, Greece. A consortium led by U.S. oil major Chevron has signed exclusive lease agreements to search for natural gas off southern Greece, expanding the United States’ presence in the eastern Mediterranean.
Lease agreements and exploration area
The agreement allows Chevron to lead the search for gas in four deep-sea blocks south of the Peloponnese peninsula and the island of Crete, covering 47,000 square kilometers (18,147 square miles). It follows Chevron and Hellenic Energy, Greece’s biggest oil refiner, last year winning an international tender.
Broader context and recent deals
The deal doubles the amount of Greek maritime acreage available for exploration and is the second in months involving a U.S. energy major as the European Union seeks to phase out supplies from Russia and the U.S. seeks to replace them. In November, Exxon Mobil joined Energean and Helleniq to search for gas in another offshore block in Western Greece.
Greece’s energy position and EU transition plans
Greece has no gas production and relies on gas imports for power generation and domestic consumption, and it has revived its quest for gas exploration after a 2022 energy price shock driven by Russia’s invasion of Ukraine. The European Union is building up renewables capacity to cut greenhouse emissions, but has acknowledged the need for natural gas as a transition fuel to help stabilise the grid when intermittent wind and solar energy are not available.
Approval process and timeline
The Greek parliament will need to approve the lease contracts before the Chevron-led consortium can start seismic research later this year. Greece has said the consortium has up to five years to locate potential recoverable deposits and any test drilling would not take place before 2030-2032.
Other licences south of Crete
Exxon Mobil and Helleniq also hold a licence to look for hydrocarbons in another two deep-sea blocks south of Crete and are evaluating seismic data before moving ahead with any exploratory drilling there.
What steps must Greece’s parliament take before the Chevron-led consortium can begin seismic research?