"Glaucos-1" finds are a game changer for the energy game in the South Eastern Mediterranean. Can Cyprus defend it's energy plan and endure Turkey's pressure?

Tassos Tsiplakos - South East Med Energy & Defense Analyst

Last Thursday's announcement that the US energy giant Exxon-Mobil has made a "world-class" discovery in Block 10 of Cyprus’ exclusive economic zone (EEZ), containing 5-8 trillion cubic feet of gas, was widely seen as signifying that the energy game in the Eastern Mediterranean has only just begun and the main stakeholders' next moves will determine their future geopolitical position in the wider region. The large deposit found, however, is considered to be a game changer not only in the energy map of the region, but also in the positions of all sides for the future of Cyprus.

According to Cyprus' Energy Minister Yiorgos Lakkotrypis, "…the discovery is the biggest find so far in Cyprus and based on some official data it is one of the biggest finds worldwide in the past two years." He added that the find offers confirmation that there is the potential for further hydrocarbon discoveries off the island’s coast. The announcement was made two months after Exxon-Mobil began operations with its partner Qatar Petroleum in the Glaucos-1 and Delphyne-1 wells in Block 10.

Nicosia establishes Energy Investment Fund

The speed at which Cyprus makes its next moves in the wake of the announcement by ExxonMobil, is seen as a determining factor in the island’s energy development. So far, this sense of political expediency appears not to be lost on Cyprus, with its Parliament convening immediately after the find’s announcement and voting through legislation for the creation of a National Hydrocarbons Fund. The initiative, also, seeks to counter anticipated accusations from Ankara that Nicosia is acting unilaterally without due consideration for Turkish Cypriots.

With 43 votes in favour and 7 against the House of Representatives passed into law the National Investment Fund and the Cyprus Investment Management Organization and related issues bill, which sets up the legislative framework for the establishment and operation of the National Investment Fund, under the provisions of the Financial Liability and Financial Framework Law. The law contains an amendment to the bill tabled by DISY and AKEL which stipulates that the Fund will not be linked to public debt. This point is considered by analysts as a responsible step and a public policy success. The explanation reads that the creation of the Fund must be institutionalized in a way that ensures its proper operation and performance through investments for the benefit of all Cypriots.

Turkey's theories about its rights to the Eastern Mediterranean's energy wealth

The latest Exxon-Mobil's announcement has sparked speculation in Greece and Cyprus over the stance of Turkey, which has raised objections to Nicosia’s search for gas in the island’s EEZ. Turkey considers an important development that the region of the Eastern Mediterranean becomes a major source of hydrocarbon resources and considers to have rights for many reasons. Initially it claims the proceedings through the rights of the Turkish Cypriots. Moreover, it considers that its continental shelf is in contact with several areas of plots 4,5,6,7 in which the Republic of Cyprus plans to drill in the following period. Ankara has already said that it will send two drillships to these areas off the southern coast to conduct its own exploration.

In addition, the Turkish Petroleum Research Society (TPAO) has entered into agreements with the pseudo-state and in the near future research is expected to be carried out in the northern area of the island. At the same time, Ankara has prevented ENI from conducting surveys at the "Soupia" site on Plot 8. Although Turkey has no direct rights in the region, it invokes the contract with the so-called "Turkish Republic of Northern Cyprus" that has granted exploratory rights to that plot.

Ankara does not ignore the fact that it has little or no diplomatic relations with Egypt, Israel and the Republic of Cyprus, which have found significant gas fields. However, it argues that the gas will reach Europe in a fast and more cost-effective way through its territories. As such, Turkey pushes in every way to secure a share of the energy wealth as Ankara thinks that the energy future of the country is at stake.

The strong presence of the Turkish Navy with the exercise "Blue Motherland - Mavi Vatan", performing drills simultaneously in the Black Sea, the Mediterranean and the Aegean Sea is considered a demonstration of power and a message that Turkey should not be ignored in the energy game of the region, but also in the energy security. Besides, Turkey argues that it has the largest fleet of the three countries that have found resources in the eastern Mediterranean.

Regarding the Cyprus issue

Of all the aforementioned developments, the effects on the Cyprus issue are certainly not neglected. Turkish Cypriot leader Mustafa Akinci, in his first statements after the announcements regarding the "Glaucos-1" deposit, reiterated that the most reasonable route for the gas is through Turkey. Here, however, there is a big issue according to Greek Cypriot sources. And this generally, in the current phase of the Cyprus issue, is not to engage the debate with the natural gas. It is a standing position of the Greek Cypriot diplomacy that Turkey has a role to play, but it should go into discussions with the Republic of Cyprus on the issue, which is far from being accepted by Ankara.

Hence, the process of licensing and gas search has never ceased on the part of Nicosia, despite certain developments in the Cyprus issue. However, it should be stressed here that any new drilling in Cyprus' EEZ, confirmed by ExxonMobil or other companies, is planned -according to information- for after September. This opens up a window of developments for the Cyprus issue, a fact admited by diplomats, as long as the first step is taken. The drafting of the terms of reference.

Cyprus' geostrategic and energy plans' security

In order to secure its energy plans, Cyprus participates in two tripartite treaties: The Israel-Cyprus-Greece and the Egypt-Cyprus-Greece. These treaties, together with the support of the EU and especially the U.S.A., that has stated will not remain idle in case Turkey tresspasses Cyprus' EEZ either by drilling actions or harassment and interidiction of the programmed drillings, provide the necessary diplomatic and defense context against Turkey's increasing threats. Moreover, US Ambassador to Greece Geoffrey Pyatt recently said that the US Secretary of State Mike Pompeo is likely to participate in the next trilateral summit between Greece, Cyprus and Israel which will be held in March. A statement which was confirmed by the Israeli Prime Minister Benjamin Netanyahu yesterday.

The participation of the US' top diplomat in the summit would send a strong signal of support for the cooperation between the three countries and Egypt, but also for the need to develop wider synergies in the Mediterranean. The East Mediterranean’s importance is associated with the EU and US’s strategic decision to reduce European dependence on Russian natural gas. Therefore, the region is perceived as a supplementary alternative that can contribute to this objective, together with other sources such as Egypt’s EEZ, where they have secured an offshore field, as well as into Greece’s EEZ.

As for France, TOTAL is about to enter three offshore fields where Italian ENI is already present, while the Cypriot government will also assign to the French energy company an exclusive offshore field. There is an even more important aspect in Cyprus’ security, however, a most imperative one for energy planning and projects in the works, and that’s none other than the signing of a defence agreement between Nicosia and Paris in March. This accord will provide facilitties in the Vasilikos Bay where naval ships from France and elsewhere will pull into port. The military presence of the French in Cyprus, in Mari and Paphos areas, where the aforementioned improvement projects are already underway, is a given, but at the same time the cooperation is expected to include an aircraft maintenance unit and probably the installation of a French radar in Troodos.

Just as the United States is showing an interest in playing an auxiliary role in the Greece-Cyprus-Israel partnership in areas such as security, so is France -having traditionally maintained a presence in the area- which is seeking to bolster its role further by being included in the other trilateral cooperation scheme between Greece-Cyprus-Egypt, though to what extent and in what form has yet to be decided.

Additionaly, the Cyprus' political decision to participate in the construction of the EastMed pipeline confirms the significance of this project for the country's defense grid, which beyond its main energy nature also possesses a clear geopolitical and geostrategic one. It may even take on the guise of a security subsystem that will alter not only the military but also the energy and economy balances between Cyprus, as well as the rest participants in the project, and the EU on the one hand, in comparisson to those between the EU, Russia and Turkey on the other. EastMed creates a new geopolitical and geostrategic environment that serves a dual strategic purpose:

a. Maintaining the existence of the Republic of Cyprus on the one hand and deterring its dissolution as well as the Turkish threat on the other.
b. Making secure the exploitation of natural gas.

An area of particular strategic importance

When attempting to plan the defence and security of an enormous region such as the Southeast Mediterranean, where a complex grid of offshore/onshore energy infrastructures is already being developed and is expected to develop further, one cannot avoid focusing on the major island-aircraft carrier that dominate the region's routes.

The strategic importance of Cyprus for the Middle East and the Eastern Mediterranean regions had been recognized since antiquity. A very recent historical example is the presence of the two Sovereign British Bases on the island (Dhekelia, Akrotiri). The first includes port facilities and the second an extensive air base. The preservation of these particular bases and of other facilities (such as the radar on the summit of Mt. Troodos, the highest peak in Cyprus) was defined as an inviolable term by Britain prior to its consensus in 1960, on the Proclamation of Independence for the state of Cyprus which until then had been British territory. More specifically, the southern and eastern coasts of today's Republic of Cyprus, which are about 60% of the island, completely control the area between Cyprus, Egypt and Israel where the energy infrastructure and natural gas fields are currently located.

In the southern part of the island there is the "Andreas Papandreou" AFB at Paphos. The base was constructed in the 1990s as part of the implementation of the joint declaration of the "Single Greece - Cyprus Defence Area" doctrine. The base was constructed in order to accommodate Greek fighters staging in Cyprus. Today, it is used as the main base for the Cypriot National Guard's air arm, where all its air assets are stationed (armed and attack helicopters, search and rescue helicopters, e.t.c.). The base with its hardened aircraft shelters can accommodate the relocation of a reinforced aircraft squadron. Also, on the territory of the Republic of Cyprus is the Larnaca International Airport with the capacity to serve large-sized commercial, as well as military, aircrafts. To the east, near the city of Limassol, is the "Evangelos Florakis" naval base, which at the moment can only accommodate small sized vessels. That is why Cyprus, within the framework of the European Union PESCO (Permanent Structure Cooperation) initiative, shall upgrade and expand the naval base and shall also modernize the air base and the Zenon operation centre in Larnaca. The Republic of Cyprus has two major commercial ports in the cities of Limassol and Larnaca, with the one in Limassol being the main port of trade for Cyprus and also an international transit trade hub.

Another particularly strategic parameter for Cyprus is the fact that, owing to its insular nature and its distance from both the Asian and African coasts, the island has a disproportionately large EEZ and FIR in relation to its land area. Cyprus' really large EEZ is due to the provisions of the new 1982 Law of the Sea convention. The very large Nicosia FIR is one of the benefits of the British legacy, as its limits were defined at a time (1947) when Cyprus was still British territory.

Countries such as Israel with a very small airspace and a limited FIR, need a much larger airspace for their air force to practice in, which requires application and approval by the air traffic management authority of the state controlling the neighbouring FIR. Today of course this is possible due to the excellent Israel-Cyprus relations.

The Defense Capability

The question is whether Cyprus is adequately defended, as it possesses no combat aircraft nor any major naval units. Cyprus realizing its strategy to become the outmost E.U. frontier in the region whatever it takes, as well as the growing needs for the defense of its EEZ, plans a new rearmament program for its National Guard. Conforming to EDA's guidelines and decissions, this programme of about 100 millions aims to the aquisition of european weapons systems, as well as U.S. ones, should the arms sales embargo raises. In this context, Cyprus and Germany agreed to intensify their cooperation within the framework of the EU’s Permanent Structured Cooperation (PESCO), with Ursula von der Leyen, Germany’s Federal Minister of Defence saying recently that "…Cyprus is a valuable partner for Berlin."

Additionaly, Cyprus exploits its strategic position through the installation of anti-aircraft and anti-ship systems. In terms of anti-aircraft systems, the Cyprus National Guard has 6 self-propelled BUK M1-2 type a/a systems of Russian origin, 6 self-propelled TOR M1 short-range a/a systems also of Russian origin and finally 12 Skyguard a/a systems, which each of these consists of the FDC (Fire Direction Centre), 2 quad ASPIDE-330 rocket launchers and 2 twin GDF-0052 35 mm guns.

For strikes against enemy naval units, Cyprus has since the mid 1990's acquired 3 EXOCET MM40 Block II surface to surface coastal batteries, with a maximum range of 70 km. Each battery consists of a self-propelled Command and Control Centre linked to a Score surface radar unit, the launcher unit consisting of a quad MM40 Block II missile launcher mounted on a Renault TRM 10ton 6X6 truck, plus an additional self-propelled NS-9003/A passive acquisition unit made by Israeli ELISRA. The passive acquisition units, acquired around 2000, have been mounted on STEYR 14M18 5 ton trucks and allow the location and acquisition of targets, with the minimum operating time of the Score radar to prevent its location by enemy countermeasures.

Common Aeronautical Exercises

The recently forged Israel-Cyprus-Greece and Egypt-Cyprus-Greece, under the auspices and assistance of U.S.A., alliances have a well-shaped military character. Of great interest is the fact that Egypt, Israel, Greece and Cyprus have been intensively involved in the Eastern Mediterranean during the last 5 years, mainly in bilateral exercises. The bilateral "MEDOUSA" the large-scale, for air and naval forces, exercises between Greece and Egypt began in December 2015, and were repeated in December 2016, August and October 2017, June and October 2018. The exercise scenarios are gradually being expanded but the participating forces are also increasing both in size and in the variety of the hardware involved.

Cypriot and Israeli forces have been participating in corresponding large scale bilateral exercises ("Onisilos - Gideon", "Nikokles - David", "Jason") since 2014. In 2017 two large-scale exercises were held in the territory of Cyprus (March and December) and in March 2018 the exercise took place aiming at counteracting a possible annexation of Cyprus by Turkey. These drills are repeated continuously.

Commenting on the above exercises, one may note that they go beyond the usual level of combined exercises to exchange experiences and strengthen bilateral relations. Their scenarios are extremely complex with a very large number of participating forces and hardware, indicating that all four countries are intensely promoting their military cooperation to a great extent and very frequently, to prepare for combined military action if necessary, but also to send convincing messages to anyone who might attempt to prevent this kind of co-operation, which includes cooperation - consensus on the exploitation of the energy resources in the South Eastern Mediterranean.

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