The Cyprus Hydrocarbons Company was prescribed by the Council of Ministers as the legal entity responsible for the management of the Republic’s participation in the activities of prospecting, exploring and exploiting hydrocarbons, based on Article 16 of the Hydrocarbons (Prospection, Exploration and Exploitation) Law of 2007.
The National Oil Company was established through the Council of Ministers’ decision no. 73.493, dated 2.5.2012, as a private limited liability company with the mandate to act as the commercial arm of the Republic of Cyprus, marketing the island’s share of any future hydrocarbons production and holding the government’s share in oil and gas infrastructure projects.
The Council of Ministers’ decision no. 75.903, dated 16.10.2013, defined the provisions of the company’s Articles of Association and officially authorized the company to undertake the management of the participation of the Republic of Cyprus in activities of prospection, exploration and exploitation of the Hydrocarbons.
CHC was set up in its present status on March 2014. The Company has a Board of seven (7) Non-Executive Directors that are appointed by the Ministerial Council, and is managed by an Executive Team whose members were recruited primarily from Oil and Gas Majors covering skill sets from Geoscience to Production Engineering and Commercial Management.
CHC’s main activities include, inter alia, the following:
(a) Marketing / disposal of RoC’s ownership interests
(b) Acting as an observer in the operating or management committees established in accordance with the provisions of Production Sharing Contracts (PSC)
(c) Managing the offtake of the GoC share of profit oil or gas, in accordance with the provisions of the PSCs
(d) CHC will have an ownership interest in a potential LNG terminal and the LNG Liquefaction Plant
(e) Participation in the procedures for the appraisal of whether the exploitation of hydrocarbons discoveries has a potential commercial nature, and discussion with the contractors of any development solution within Cypriot EEZ
(f) Upon termination, relinquishment or cancellation of a PSC, the assets belonging to the contractor required for Hydrocarbons Operations in the relinquished area will revert to CHC ownership
(g) CHC shall manage the ownership interests of the GoC in subsea pipelines
(h) CHC shall expand its operations to include owning participating interests in hydrocarbons licenses and performing physical hydrocarbons operations