East Med Offshore waters are warming

Eastern Mediterranean Offshore Waters are warming- OpEd

Relative optimism on Eastern Mediterranean offshore gas explorations may soon face a nasty hard fact. First let’s see the latest offshore reserve figures. New figures are emerging every day about the East Med offshore natural gas reserves. Therefore we advise you to be cautious about the numbers we will give here. There are 320 bcm (billion cubic meter) in the Tamar region of Israel, 600 bcm in the Leviathan region, 130 bcm in the Southern Cyprus Aphrodite region, and an estimated 850 bcm natural gas reserves in the Egyptian Zohr region. Companies BP, ENI, Exxon, Total are working in the East Mediterranean region. Let’s keep in mind that annual Turkish import of natural gas is around 50bcm in recent years.

Turkish Naval Forces war ships, prevented drilling vessel of Italian oil company ENI, from reaching the controversial Cypriot offshore area. There was a pre-announced Turkish military maneuver in the area. Ankara showed its hard attitude towards the conflict with this intervention. Ankara states that the offshore reserves also belong to the Turkish part of the island, and want a fair share of natural gas resources.

Cyprus’s environment offshore region, is now the second area of conflict between NATO members. First conflict is in the Northern Syria. There is no war between NATO countries. This is not allowed. But they can always harass each other, dog fights are normal.

On the other hand, geographically, due to proximity to the mainland, easy logistical support, the overwhelming dominance of the naval and air forces of Turkish armed forces is unquestionable.

Ankara’s regional political and administrative anticipations no longer depend only on perceived threats, but also on energy reserves.

Since last week launched around Cyprus against gas exploration joint venture of French Total- Italian ENI, Turkey has stepped up military activities in the region.

The Egyptian-Turkish dispute continues on the other side of the Eastern Mediterranean region. Cairo put its weight on the side of Nicosia because of the Turkish statements of the Muslim Brotherhood and military activities that began in Syria and on the Horn of Africa. The Egyptian Foreign Minister said that not only the Cyprus offshore gas exploration projects, but the maritime trade agreement with the Exclusive Economic Zone (EEZ) Cyprus, 2003, applies to all.

In 2003, Cairo and Nicosia signed an agreement to set up an EEZ in the Eastern Mediterranean for natural gas exploration and production at nearby offshore sea regions. There is not yet an EEZ map agreed on Eastern Mediterranean countries. Every country takes care of their own interests and does not refrain from taking tough military measures to implement them.

Ankara opposes these formations because the Turkish Cypriots demanded legal rights and fair sharing over marine resources. Turkish Minister of Foreign Affairs regarded the Cairo- Nicosia EEZ agreement as “null and void”.

Cairo warned neighboring countries not to violate Egypt’s sovereign rights. South Cyprus and Egypt are supported by the European Union. Turkey began blocking against other sea areas to the Greek and Greek Cypriot ships. Ankara warned that international companies could lose Ankara’s friendship. Cairo aims to further expand its overseas production in the Zohr gas field and the latest BP offshore area. Cairo is implementing plans to become an big LNG exporter in the East Med region by 2020.

These plans will be combined with the Cyprus-Israel offshore gas production partnership.

Israel-Turkey relations were severed at the end. Israel’s plans on the old pipeline to export gas to Turkey. The US and EU first encouraged this partnership. The current stance in Ankara does not allow these joint plans anymore.

Eastern Mediterranean easiest and cheapest transit route to European markets is passing over Turkish mainland soon after production of offshore gas. Other alternatives seem to be more expensive, long-term, hard tricky solutions.

One way of making Israeli gas commercially attractive is export co-operation with Egypt. Ankara’s strategic preferences now seem to consolidate Egyptian-Israeli ties. South Cyprus, the EU member, is considered the gateway to Europe and therefore they have of strategic importance. With the possibility of re-opening and possibly expanding Egypt’s existing LNG liquefaction schemes, a new Triple Coalition for offshore gas production may be established.

Fair Share demand not just from Turkey – Nearby countries Lebanon and Syria also ask to have their share.

Israeli navy is expanded forces to protect gas projects and shipping lines. An increasing foreign threat in Lebanon will only give more emphasis to Israel. The expansion of the Israeli navy will not only be threats to the north, but also the threats to the Palestinian extremist Hamas movement overseas projects.

When we look at the facts in the region, there is a possible hot war. “Eastern Mediterranean” gas futures will get harmed.

Increasing insecurity in the region or possible war does not only threaten Israel or Lebanon, but it also spreads to other countries.

In the big picture, gas operations are not the only threat.Threats and conflicts at sea can also damage other oil transports. Offshore region may face complete military conflict involving Israel-Cyprus-Lebanon area, from Ceyhan (Turkey) to block incoming oil transit lines.

At the same time, in a direct conflict between Cyprus and Turkey, will also direct transit routes through the Strait threatening Greeks.

Both can threaten the transportation volume between 1.6 million bpd (BTC pipeline) and 2.9 million bpd (Bosphorus).

There is not much that the US and Europe can do for now.

Without rational fair share of natural gas reserves between nearby countries, a permanent solution is not possible to accept in the Eastern Mediterranean. Ankara March 6, 2018

---

Haluk Direskeneli, is a graduate of METU Mechanical Engineering department (1973). He worked in public, private enterprises, USA Turkish JV companies (B&W, CSWI, AEP), in fabrication, basic and detail design, marketing, sales and project management of thermal power plants. He is currently working as freelance consultant/ energy analyst with thermal power plants basic/ detail design software expertise for private engineering companies, investors, universities and research institutions. He is a member of ODTÜ Alumni and Chamber of Turkish Mechanical Engineers Energy Working Group.

This article is written for "EurasiaReview" web site release.

-->