Growing Tensions In The Eastern Mediterranean Over Abundant Offshore Gas Discoveries

Written by Dr. Sasha Toperich and co-written by Jonathan Roberts, WYLN Mediterranean Basin Fellow

The Eastern Mediterranean is emerging as the region to watch in contemporary global affairs. Standing at the focal point for future progress and conflict is energy security. The US Geological Survey estimates that there is 120 trillion ft3 of natural gas in the Eastern Mediterranean. With declining gas supplies in the North Sea and Europe searching for new energy source prospects to decrease its energy dependence on Russia, the immense, newly-discovered natural gas reserves in the Eastern Mediterranean is reshaping relations between countries in the region and far beyond. The race for drilling, pipeline routes, and export agreements has begun, and it is already a bumpy ride. Fixed midstream assets and pipes will be key to bringing the newly discovered natural gas to world energy markets, but the current political landscape in the “core” Eastern Mediterranean countries—defined as Cyprus, Egypt, Greece, Israel, Lebanon, Libya, Syria, and Turkey—will require significant effort to overcome a number of challenges.

The potential to promote stronger regional cooperation is great, but so is the potential for further conflict. In particular, relations between Turkey and Cyprus, Egypt and Israel, and relations in the Levant will be key for energy security in the Eastern Mediterranean. The first relation worth noting is that of Turkey and Cyprus. Experts have reached a notional consensus that a pipeline route north to Turkey via Cyprus is economically the most realistic possibility, regardless of the expansive mountainous terrain it must cover to connect it with the Trans-Anatolian Pipeline (TANAP) and the wider Southern Gas Corridor. However, Turkish vessel rammed a Greek coastguard boat off Imia, but fortunately no casualties were reported. Turkey has also threatened to use force against a drillship chartered by Italian oil giant Eni (operating in partnership with France), forcing the Saipem 12000 drilling vessel to leave the area. The Cyprus government and the European Commission warned Turkey to refrain from any threat against Cyprus, calling Turkey’s behavior “damaging for good neighborly relations and the peaceful settlement of disputes.”

In response, Turkey denounced Cyprus’s unilateral drilling and Turkish President Recep Tayyip Erdogan warned Cyprus and foreign companies to not infringe on Turkey’s sovereignty. The Italian government says it is monitoring the situation and that it would take all possible diplomatic actions to resolve the issue. Cyprus President, Nicos Anastasiades, stated that Turkish action violated the international law, but that he will do all it takes to avoid further escalation of the crises. Turkish Cypriots are now calling for the settlement of rights to all 12 drilling plots before there are any political discussions on Cyprus unification. It is believed that Cyprus’s offshore natural gas reserves rival that of Egypt’s vast Zohr gas field. Earlier hopes that the Turkey pipeline route would help bring a political compromise to Cyprus unification talks, now look grim. Nevertheless, the suggested pipeline via Turkey is more economically feasible than a longer, expensive undersea route.

Cyprus, Egypt, and Greece have opened the door for cooperation on energy matters. The three countries have signed an agreement for the creation of a new undersea electricity cable, the Euro-African Interconnector. This cable will link Cyprus to Egypt and Greece through Crete and will further establish Cyprus as a regional energy center. The cable between Cyprus and Egypt will connect to other African and Middle Eastern countries, and the cable between Cyprus and Greece will create a connection with European countries. Similar to Cyprus, Egypt has also an opportunity to position itself as an important energy hub. The country has oil trade agreements signed with Jordan and Iraq. Exploration of the Zohr gas field has led to an immense surplus of supplies, which Egypt will export. Such a financial windfall will significantly help Egypt with its ongoing robust reforms, supported by the IMF, after ousting Morsi’s destructive Muslim Brotherhood government. Egypt’s relations with Israel will be vital for the country to maximize the benefit from its energy surplus. Shared commercial and strategic interests in the two countries have fostered important dialogue, but not without contention.

Recently, Egypt’s Dolphinus Holdings and Israel’s Delek Drilling (together with its U.S. partner, Noble Energy) signed a 15 billion dollar, 10-year deal to export gas from Israel to Egypt. Gas will be delivered from Israel’s already-operational offshore Tamar gas field. Beginning in late 2019, this will also include the offshore Leviathan gas field. Development on the Tamar gas field began last year, a $3.75 billion investment. Currently, Egypt and Cyprus are closing a deal where Cyprus will sell natural gas to Egypt’s liquefied natural gas plants (LNG) from its offshore Aphrodite gas field that has around 4.5 trillion cubic feet of gas. It will likely go to Egypt’s Damietta and Idku LNG plants, located about 400 miles south of Cyprus. Egypt and Cyprus, together with the European Union, will sign an agreement to build a Cyprus-to-Egypt gas pipeline, the EU being the main beneficiary. The deal with Egypt has provoked outspoken Israeli disapproval. Owners of the rights to Israel’s Ishai, which borders the Aphrodite field, have asked the Israeli government to stop the Cyprus-Egypt deal. They claim that any extraction of gas on the Cypriot side would lead to extraction of gas from Ishai as well. The Israel government responded that “development of the reservoir necessitates agreement between the parties and safeguarding the rights of both countries.”

Energy Security In The Eastern Mediterranean

The Eastern Mediterranean therefore has two viable options to supply gas regionally: to build a pipeline connecting Israel, Cyprus, and southern Europe, or to create a network of pipelines from Israel into Egypt where it could be liquefied and exported. But the latter between Egypt and Israel faces a serious energy security risk, the belligerence of Islamist militants in Sinai. In 2015, the jihadi group Ansar Beit al- Maqdis, otherwise known as the “Champions of Jerusalem”, blew up the natural gas pipeline near el-Arish (the provincial capital of North Sinai), although they did not directly claim the responsibility. It will be up to Egypt’s military to secure northern and central Sinai from the terrorist group. Egyptian President, Abdel Fattah el-Sisi, with his recently-launched military operation called “Comprehensive Operation Sinai 2018”, plans to maintain full control of the Sinai desert, the Nile Delta, and the Western Desert. This operation was ordered after an attack on a Sinai mosque that killed more than 300 people, stunning the entire nation as the deadliest attack of its kind in Egypt. Building up a permanent military and civil presence in these areas can eliminate security risks.

Tensions between Israel and Lebanon over offshore energy continue to rise. The Lebanese government has announced oil and gas tender exploration in disputed territory on the countries’ maritime border, encouraged by the discover of vast sub-sea gas fields over the past decade. These findings include Israel’s Leviathan and Tamar gas fields, located in waters near the disputed Israeli-Lebanese marine border. This long-standing dispute between Israel and Lebanon over 300 square miles of waters has triggered talks of another conflict between the two countries. With ongoing Syrian and Lebanese hostilities toward Israel, a much more economically feasible Israel-to-Turkey pipeline through Lebanon and Syria is off the table.

Indeed, Israel faces immense pressure on many fronts. Hezbollah continues to provoke Israel from its Syrian and Lebanese border, inflicting psychological warfare in an attempt to affect Israeli public opinion and influence Israel’s military mobilization. These provocations are best viewed as proxy to mounting Israel-Iran belligerence, according to Dr. Spyridon Litsas, scholar at the Begin-Sadat Center for Strategic Studies. Tehran’s rising position and Jerusalem’s mounting pressure could ensure the outbreak of conflict in a real-life example of a Thucydides’ Trap. Just recently, Italy, Cyprus, Israel, and Greece signed the provisional agreement to complete the world’s longest subsea pipeline. However, many question its economic viability. In April of 2017, EU and Israeli officials expressed their support for the Eastern Mediterranean Gas Pipeline (EastMed) via Crete, which bypasses Turkey and avoids liquefaction. The EastMed pipeline will require a serious investment, with construction costs estimated to be 6.2 billion euros. But the EU must acknowledge current political realities in the region that elevate their own energy security risks; considering this, the EastMed pipeline may end up more profitable thanks to its low-risk profile. Investors will inevitably look for more gas findings in the area that justify long-term investment, given whether there are sufficient volumes available. Given the myriad of disputes and hostilities, perhaps the best way forward for the Eastern Mediterranean can be summarized in the words of former US Secretary of State Rex Tillerson when he addressed Israeli-Lebanese disputes, “We’ve asked no one to give up anything. Rather, we’re looking for a solution.”


15 Responses to “Growing Tensions In The Eastern Mediterranean Over Abundant Offshore Gas Discoveries”

Post A Comment

military dot image Andy    Thumb up 0 Thumb down 0

Very insightful piece that outlines well the situation in the Eastern Mediterranean. While energy supplies and energy security triggered conflicts, as they may well do so now again, perhaps there is an opportunity to break through in bringing peace and stability in the region through energy cooperation. Thank you for highlighting this !

military dot image Josh    Thumb up 0 Thumb down 0

Glad you quoted our now former Secretary of State, Rex Tillerson! The US should keep the leading role in helping solve the issues in the Eastern Mediterranean. Timely and excellent article! Our Assistant Sec of State Wess Mitchell is in the region, in fact in Cyprus TODAY! Thank you US Military for keep posting important world issues at your website.

military dot image Andy Braner    Thumb up 0 Thumb down 0

Will be watching with interest to see the Eastern Mediterranean Gas reverberate through geo-politica issues going forward. l

military dot image Tea    Thumb up 0 Thumb down 0

Great article. The authors clearly show the abundance of offshore gas reserves – there is plenty for all countries in the region. This is an opportunity to press for cooperation over confrontation.

military dot image Pile    Thumb up 0 Thumb down 0

Very insightful and detailed outlook of an energy-potent region. Must-read!

military dot image John M.P.    Thumb up 0 Thumb down 0

It is good to see Egypt and Israel strengthening their business cooperation. Good story!

military dot image Haris O.    Thumb up 0 Thumb down 0

Good the US is energy independent, to help the Eastern Mediterranean region share in wealth and enhance cooperation.

military dot image Furcage    Thumb up 0 Thumb down 0

It seems Egypt is emerging as a new energy hub! Good for them! nice article!

military dot image E. Neveba    Thumb up 0 Thumb down 0

Thank you US Military and authors for this excellent article!

military dot image N.Budé    Thumb up 0 Thumb down 0

Good article about a big potential country. Thank you Mr.Toperich and US Military, very intresting and important

military dot image John C    Thumb up 0 Thumb down 0

Thank you authors for your insightful comments. Seems like very exciting times in the east!

military dot image Jason M    Thumb up 0 Thumb down 0

Fascinating look at energy in Mediterranean – it would be great to have delved more into the role of renewable energy sources in the region

military dot image aylin    Thumb up 0 Thumb down 0

very good written article. Congrats!

military dot image Wallie    Thumb up 0 Thumb down 0

Thanks so much for sharing and keeping us updated on these important issues of our day. Are there any US Congressman or Senators engage on this matter?

military dot image Olivia    Thumb up 0 Thumb down 0

A very interesting and thought-provoking piece. Thank you Dr. Toperich and Mr. Roberts for sharing on this important issue!

Leave a Reply

Previous Post <<
Next Post >>