On January 2nd, Greece and Cyprus made history after signing a deal with Israel on a nearly 2000-kilometre subsea pipeline, the EastMed, set to bring natural gas from Israeli and Cypriot offshore reserves to Cyprus, Crete, and Greece.
The signing in Athens was attended by Israeli Prime Minister Benjamin Netanyahu, Greek Prime Minister Kyriakos Mitsotakis, and Cypriot President Nicos Anastasiades, along with their respective energy ministers: Yuval Steinitz, Kostis Hatzidakis, and Yiorgos Lakkotrypis. Notably, the deal allows for other countries to join the project.
A joint venture between Greek gas firm DEPA and Italian energy group Edison, the pipeline project is owned by IGI Poseidon, which has agreed to fast-track development. The Italian government will sign off on the arrangement at a future date. Meanwhile, DEPA has inked a letter of intent with Energean – a gas producer mostly working in the eastern Mediterranean – to buy two billion cubic metres of gas, annually, from Energean’s fields in Israel via EastMed.
The European Commission is reviewing the feasibility of the pipeline, but has pledged 36.5 million euros for research and technical planning to support diversifying gas supplies and boosting Europe’s energy security. The US also supports the project, as expressed by US Secretary of State Michael Pompeo during a Cyprus-Greece-Israel trilateral summit in Jerusalem last March. Contributing to energy growth in Europe, the Cypriot government has licensed Italian energy company Eni, France’s Total, and US companies ExxonMobil and Noble Energy, to carry out exploratory hydrocarbon drilling in Cyprus’ offshore economic zone.
EastMed is opposed by Turkey but heralded in Southern Europe as a way to feed the growing demand for natural gas in their states, while reducing energy dependence on Russia. Once in operation, the pipeline is expected to transfer between 9 to 12 billion cubic metres a year – approximately 10 percent of the continent’s gas demands.
Mitsotakis has said the pipeline will offer Europe “better flexibility and independence in its energy sources”, and Netanyahu believes that with this deal in place, the three countries have succeeded in establishing ”an alliance of great importance” that will bolster regional stability.
The project helps further cement Greece as an energy hub from the Mediterranean to the rest of Europe, and also serves to put Israel on the map as a regional energy provider – a major win for the small state. Participating countries expect to reach a final investment deal by 2022, with the current budget anticipated at over 6 billion euros. The pipeline is set to be completed in about seven years.
“Today, we did not just sign an advantageous agreement, but also cemented our decision for strategic engagement in a region that’s in need of cooperation”, Mitsotakis said at the ceremony. “EastMed is not a threat to anyone”.
In a New Year’s Day interview with the Cypriot Phileleftheros newspaper, President Anastasiades said that the agreement sends strong messages of European solidarity, noting “Especially under current conditions, it demonstrates the strong political will of the countries involved, as well as the European Union, that they don’t accept Turkey’s unlawful actions“.
Across the sea, Turkey has long engaged in raising stakes in the region and is infuriated at the EastMed deal. The country does not recognise the Cypriot government – only acknowledging the breakaway Turkish Cypriot state – and has claimed much of Cyprus’ EEZ, contesting Cypriot sovereignty and rights to explore for hydrocarbons in the area. Over the past year, Turkey has sent two of its own drill ships to the region and drones over Cypriot airspace, for which it now faces sanctions. The country also contests Greek sovereignty over its waters and hopes to impose its rule over much of the eastern Mediterranean, thanks to a new maritime agreement with Libya.
However, Anastasiades has affirmed that “This cooperation that we have developed…isn’t directed against any third country. On the contrary, whichever country [that] wishes [to] is welcome to join, on the understanding of course that it adopts the basic principles of international law and fully respects the sovereign rights and the territorial integrity of independent states”.
An Energy Boon for Europe
Between weaning itself off its dependence from Russian natural gas and looking to cut down on coal and other high greenhouse gas emitting fuels, Europe is hungry for energy. Some of that demand is being met by shipping liquified natural gas. The Trans-Adriatic Pipeline (TAP) will begin delivering gas this year from the Caspian Sea, across Turkey, into Greece and Italy – but European demand outpaces the amount of gas this pipeline can provide.
That’s where EastMed comes in. Over the past twenty years, Israel has discovered approximately one trillion cubic metres of offshore natural gas, and Cyprus has found at least three major natural gas fields of its own in the past decade.
“More pipelines, more entries of gas into the country, means more competition, and more competition means lower prices for the consumer”, Energean CEO Mathios Rigas told Al Jazeera. “This is exactly what happened with our project in Israel…So both security of supply and competition will be coming through this pipeline”.
Ioannis Desypris, a director at Greece’s leading independent electricity producer and gas trader, Mytilineos Group, has said “The EU is performing the biggest energy transition in the world today, so this is where the biggest market is going to be”, in reference to the EastMed project.
Israeli Jubilance and Turkish Fury
For Turkey, the pipeline is a blow to energy aspirations. While an energy importer itself, the country is a key transit nation in supplying other states in Europe and Asia with Russian natural gas, giving both Turkey and Russia a certain amount of political leverage that EastMed threatens to erode.
Last month, a Turkish official downplayed the need for such pipelines, saying that the trans-Anatolian pipeline already existed. “Why should we bury 8 billion euros in the Mediterranean, through Turkey’s continental shelf and exclusive economic zone? If we do not allow that what will happen? So this is an issue and we need an original solution to oil and gas around Cyprus”.
Turkish Foreign Ministry spokesman Hami Aksoy went further, saying any project that ignored the rights of Turkey and Turkish Cypriots over natural resources in the eastern Mediterranean would be doomed to fail. “The most economical and secure route to utilise the natural resources in the eastern Mediterranean and deliver them to consumption markets in Europe, including our country, is Turkey”, he said in a statement.
The President of the self-declared Turkish Republic of Northern Cyprus, Mustafa Akinci, also condemned the EastMed project, arguing that it excluded Turkish Cypriots and would make any future negotiations with Cyprus more difficult. In a statement, Akinci said that it “contradicts geographical facts, [is] unreasonable in economic terms, and was decided on purely political concerns“. He has also said that the pipeline’s route is much longer and more expensive than other alternatives. “Geographical facts indicate that exclusion of Turkey and Turkish Cypriots from the energy equation in the eastern Mediterranean is impossible”.
“The East-Med agreement between the Greek Cyprus, Israel and Greece is not in line with regional security realities and brings about the possibility of serious instability”, said Turkish Cypriot Premier Ersin Tatar a few days after the deal was announced. “It is observed that due to the political dreams, the initiative is not from economic evaluations, but intended to deprive the Turkish and Turkish Cypriots’ rights on the energy sources”.
Libya and Turkey’s Maritime Agreement
Thanks to the maritime agreement with Libya, that seeks to redistribute ownership of eastern Mediterranean waters, Turkish President Recep Tayyip Erdogan has said that no project – which includes EastMed – can proceed without his country’s consent. The European Union has condemned Turkey’s demarcation memorandum saying: “It infringes upon the sovereign rights of third states, does not comply with the Law of the Sea and cannot produce any legal consequences for third states”.
Turkey’s agreement with Libya has sparked fury in Europe and resulted in Greece expelling the Libyan ambassador and appealing to the UN to condemn the agreement. Turkey has voted to send troops to aid the government if asked, which were then summarily dispatched, albeit in a non-fighting capacity – in addition to a previous agreement in which Turkey and Libya signed an accord on natural gas drilling on Libya’s continental shelf.
On January 8th in Cairo, foreign ministers from France, Egypt, Greece, and Cyprus declared the maritime accord “void”, saying that the agreement “infringes upon the sovereign rights of third states, does not comply with the law of the sea” and does not have legal enforceability. The ministers also reiterated “the necessity of full respect of the sovereignty and the sovereign rights of all states in their maritime zones in the Mediterranean”, but none of this has deterred Turkey.
The two countries could make getting EastMed up and running more difficult, as the pipeline would cross their claimed economic zone. However, Israeli Energy Minister Yuval Steinitz offered an olive branch, saying that “If Turkey would be interested, the door is open”. “We are ready to discuss some kind of cooperation, energy cooperation, also with the Turks. We are not against the Turks but we are very much in favour of the EastMed gas pipeline project”.
Israel benefits hugely from the alliance that EastMed helps cement. Long at loggerheads, the relationship between Israel and Turkey has severely deteriorated over the past decade, in turn driving the country closer to Greece and Cyprus, as well as Egypt. The project not only gives Israel major stake as an energy provider, but also helps build a new architecture of alliances in the region.
“We have established an alliance in the Middle East, an alliance that is of enormous importance to the energy future of Israel, to it becoming an energy power, and for stability in the region”, Netanyahu said.
Israel began operations at the Leviathan offshore platform in late December, which will allow extraction of an estimated 22 trillion cubic feet of natural gas. However, the government has faced local pushback from residents fearful of pollution, despite reassurance from the Environment Protection Ministry that said that monitoring stations showed no dangers of contamination.
Israel expects that the pipeline will be financially lucrative, “bring[ing] hundreds of billions” into state coffers, Netanyahu predicted. “Just days ago we started pumping [the] Leviathan [gas field]…We have huge quantities there. This means a lot of money will come into the economy. That is good for peace because we have agreements with our Arab neighbours”.