The East Mediterranean, often referred to as the

The East
Mediterranean Sea is the southern border of Europe and represents one of the
largest areas by trade in the world. It is linked
to the Atlantic Ocean and almost completely enclosed by land; on the North by Southern
Europe and Anatolia, and, on the South by North Africa. Since 1999, the energy
discoveries in the East Mediterranean, often referred to as the Levant, have changed the geopolitical
significance of the region. The real development that changed the region’s
economy took place in 2009 with the discoveries. These finds are expected to change the strategic fortunes of the Levant.


The sizable amount of
natural gas is found offshore Israel, Cyprus, Egypt, Lebanon and Gaza Strip.
According to the EIA estimates, the East Mediterranean have undiscovered oil resources of 1.7 bil. bbls  and undiscovered natural gas resources
of 122 trillion cubic feet (tcf). Of
which, Israel has 9.5 tcf, and when it is combined with the offshore waters of
Cyprus, it has a recoverable gas of around 38 tcf.
Accordingly, Cyprus is expected to be one of the potential beneficiaries. And
so, the region is transforming from an importer to exporter.

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Cyprus have had a sustained
economic growth. This sustenance has been the result of an energy policy that
came into effect in 1960. Cyprus has been dependent on oil for around 90 per cent, which it imports mainly from Syria and
Russia; while it depends on coal and solar power for about 6 and 4 per cent respectively. Cyprus has chosen to sell its LNG, while it imports minor amounts
of electricity from Israel to cover a small per
cent of its imports. The new gas finds offshore Cyprus, made it sign an agreement with
Egypt to determine the EEZ. The field called ‘Aphrodite’
was discovered by US’s Noble Energy in Cypriot waters in late 2011. In 2012, the Republic of Cyprus (RoC) auctioned
projects to many energy companies like Total (France) and ENI (Italy). Israel’s
Delek also became a partner in the group of companies for developing the Aphrodite
field. Cyprus doesn’t use natural gas as a fuel, according to a report
(BP, 2016), it utilizes oil in its day to day consumption. This position gives
Cyprus a leverage, where it can export its gas to heavily dependent countries like
Greece or Turkey. Consequently, Cyprus-Egypt and Cyprus-Israel have signed an
agreement on delimiting of the EEZ, which came into force in March 2004 and
December 2010 respectively. Under UN and international law, the Republic of
Cyprus is the only internationally recognized sovereign entity in Cyprus.


A coup d’etat attempt
in 1974 to annex the island to Greece, provoked Turkish invasion
of Cyprus, resulting in the expulsion of the North’s Greek Cypriot population. And ever since, Northern Cyprus is dependent on Turkey
for support. While Greek Cypriots are the ethnic Greek population of Cyprus. Any attempt to reach a
solution to the problem was without success. Since 1974, Turkish troops have occupied the North of the island
calling it the Turkish Republic of
Northern Cyprus (TRNC); while Greece claims the Southern Greek Cypriots. In the meanwhile,
negotiations have resumed via UN mediation following the election of Mustafa
Akinci as Turkish Cypriot leader in April 2015. It is apparent that Nikos Anastasiades (Greek) and Mustafa
Akinci (Turkish) are in favour of the reunification
of the island. The bone of contention between the two is the sharing of resources
and rent derived from it. Hence, Turkey disputes any gas
exploration in the North of Cyprus without the consent of Turkish Cypriots. The
feasibility tests in the Exclusive Economic Zone (EEZ) offshore Cyprus by the
Turkish vessel Barbaros, also aggravated Greece. Yet, with the support of EU,
US and UN, explorations have been made possible without any significant occurrences.


Other countries in
the East Mediterranean also face similar challenges. The Egypt-Israel relations
had been cordial historically, since Camp David
Accords (1978). The Egyptian gas supplies to Israel were smooth until the Arab
Uprising. Post Arab Uprising, the Israeli gas imports have become unpopular
in Egypt. Private Egyptian firms have already begun to negotiate agreements with
the US-based Noble Energy to import gas
from the country. In 2011, Lebanon filed a complaint to the UN over its right
of the maritime border between Israel and Cyprus, over the natural resources,
while, Israel has rejected the idea of UN solving the issue. This is also added
by the diplomatic ties between Turkey and Israel which worsened after the lower
chair crisis, when Turkish ambassador Ahmet Oguz Celikkol, was made to sit in a
chair lower than that of Israeli Minister Danny Ayalon, while the Turkish flag
was deliberately not put on display. The incident is popularly called as the ‘Lower Chair Crisis’ (2010). In
the same year Mavi Marmara, a ship
carrying humanitarian aid to Gaza had a military intervention by Israel further
deteriorated the ties. Seven years since then, Israel and Turkey have agreed to cooperate in the energy sector, thus,
taking a step towards normalizing ties. The Oslo I Accord also called as Oslo I, does not mention the
exploitation of ocean floor resources as a right granted to the Palestinian
National Authority. This made the concessions granted by the late President
Arafat to British Gas and Consolidated Contractors Company, void. However, the
ceasefire of August 2014 with the help of Turkey, have given a pathway for
cooperation between Israel and Hamas. As gas is discovered in the Gaza Strip,
the development of the Gaza Marine 1 and 2 could be beneficial to Israel and
the Palestinian Authority.


Thus, for the above reasons, Cyprus plays a strategic role. Since,
it is positioned between Europe and the East Mediterranean, which makes it a
potential transit point for the energy-hungry
European countries. The study will address the case of Cyprus, which
appear to have significant offshore gas reserves available for exploitation.
This is also added to the fact that Cyprus lack capital and
technology for the development of these
reserves, which offers a good option for the Western energy firms to invest. In the current
scenario, the politics that is played around energy
with Cyprus at the center, is expected to change the geopolitical map of
the region.


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