Cyprus: struggling along, or about to hit the gas?

Cyprus has had a difficult history over the last century, a legacy it has carried into this one. However, its recent natural gas find in the Levant basin throws potential good fortune into a much suffering economy. Unfortunately for Cyprus, it is not the only country with interests in this find – Turkey and Israel are also interested.

CC-BYSA Plan for Opportunity

The background to the recent attention to gas in Cyprus comes from recent discoveries in Israel’s Exclusive Economic Zone (EEZ). The American company, Noble Energy, has been involved in Israeli development of their EEZ since 1998 and recently discovered two major sites. The Tamar site was discovered first and is estimated to hold 6.3 trillion cubic feet (tcf) of recoverable gas – nearly free from impurities. This discovery was followed by the Leviathan:- a mythical monster of a gas discovery, of an estimated 16 tcf. This monster, at a minimum, borders the Cypriot EEZ, which is where the potential for problems has arisen.

Cyprus’ problems:

Over the last year, the Republic of Cyprus has faced its fair share of problems. This discovery is the last one to be added to the list, beginning with a munitions blast  on 11 July 2011 at the Zygi naval base. The blast killed 13 people and significantly damaged the island’s largest power station. The direct cause of the fire that started the explosion is unclear, however, the munitions themselves came from a confiscated shipment from Iran, that Cyprus says contravened UN trade sanctions. The political consequence of this was the resignation of the defence minister and the head of the Cypriot army, and a recent report states that Cypriot President Christofias shares the blame for the blast.

The munitions explosion also had economic consequences as it led the downgrading of Cyprus’ credit worthiness, linking it with the suggestion that it might become the next recipient of bailout funds from the EU. This, along with the country’s upcoming turn in the rotating presidency of the Council of the EU next year, led to a cabinet reshuffle in August – Christofias put in place Kikis Kazamias, an economist, to lead it. In view of the most recent developments, questions have been raised about its ability to hold this office. In order to rebuff this, the Cypriot Deputy Minister to the President for European Affairs stressed,

‘ [O]ur objective and our deliberate and firm position is to act during the presidency in a purely presidential manner, not allowing our national problem to define our Presidency or to infiltrate the way we are dealing with issues.’

The bailout problem that Cyprus is facing is by no means the most well known of its issues. The better known problem is the unofficial division of the island after an attempted Greek coup d’état in 1974. The Turkish Cypriot north is only recognised by the Turkish government, while the island joined the EU in 2004. The whole island is part of the EU, although the acquis communitaire is suspended in the north, leaving the area not treated as a Member State, nor as a third country – the worst of both worlds. Turkey does not recognise the southern government. Negotiations between the two (including Turkey) have been a long, rocky road, with the current peace talks commencing in 2008.

Turkey and Israel’s involvement

So, this brings Turkey into the equation. Turkey is currently a candidate country. It faces many challenges along the way; potentially the most serious of these is the reunification of Cyprus. This has been made even more difficult recently as Turkey has shown little interest in the accession process recently, posing itself as a role model for the Arab world in the aftermath of the Arab Spring earlier this year. If Turkey does back away from the accession process, this would not make the reunification of Cyprus any easier.

Israel is the final country to add to this mix for now. Tensions have been high between Israel and Turkey for a considerable period of time. Back in 2010, after the raiding of a Turkish ship bound for Gaza and the deaths onboard of nine Turks, the Israeli ambassador was expelled. Turkey continued to draw lines between itself and the West during the Arab Spring as it sought to project itself as a role model for newly emerging Arab states. Prime Minister Recep Tayyip Erdoğan visited a series of countries earlier this year visibly acting the principal statesman of a new Ottoman Era, as he called on Arab countries to unite and bury the hatchet. While in Egypt, Erdoğan also pushed for Palestinian statehood, calling Israel a ‘spoilt child’.

How does this all tie together? Well, the natural gas in the Levant basin crosses both Israeli and Cypriot EEZs. Due to Turkey’s interest in Cyprus, it has sent at least two exploratory vessels  to the area to look for gas. This was made more controversial as the vessels were escorted by frigates and fighter jets. An interesting choice when it comes to tensions with Israel, a Greek Cypriot ally. The weekend of the 22 and 23 October, rumours of a joint military exercise between Cyprus and Israel sparked yet more difficulty, however there appear to have been no political agendas behind this, and Cyprus even went so far as to say that the Defence Ministry was not partaking in any exercises.

News from the Eastern Mediterranean has been the strong earthquake in the Vann region of Turkey. Erdoğan initially rejected all aid, including that offered by Israel, but recently back-tracked accepting all international aid, including that of Israel. As much as this might seem like a thawing in diplomatic relations, it does not seem to be the case in the long term. On the other hand, it is a welcoming gesture that even while relations are bad, much needed aid is still freely given and accepted.

Media coverage on the gas discoveries and the jets and frigates belonging to Turkey, currently with the Piri Reis, the original exploratory vessel, have quietened down in light of this, however this does not look to be the end, rather the beginning. However, it has been stressed that  the gas find is economically and politically volatile in an already unstable region, which should imply continued political tension between the three countries.

Questions have been tabled in the European Parliament on two occasions in September, however no response has been adopted on this changeable situation. Due to the EUs commitment to security, sustainability and competitive energy Turkey will soon be linked to the European grid. A development that makes this gas find potentially all the more dangerous as Turkey will have an added incentive to gain from the natural gas discovery.

Of course, this discovery has other elements – the social an ecological dimension. According to a recent report by the Sustainable Development Advisory Council to the German Government, the gas needs to stay in the ground. As of 2008,  there were already enough known conventional gas in know reserves to exceed the 2°C threshold beyond which climate change becomes (potentially) catastrophic and irreversible nearly 40 times over! However, add conflict between several allies of the EU, and an EU Member State, the question of ‘is it all worth it?’ arises. The EU came into being in order to prevent conflict through economic cooperation and coordination. Unless we’re careful, short-term profiteering could undermine years of hard work, including the potential for Turkey to become a Member State.

About Isabel Skrine

Isabel started as a Programme Assistant on Sustainable Energy Security for the Quaker Council for European Affairs in October 2011.
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