Tectonic changes come in the region’s energy and security sectors with U.S. support of the EastMed pipeline
Tassos Tsiplakos - South East Med Energy & Defense Analyst
Greece, Cyprus, and Israel will reportedly sign an intergovernmental agreement for the EastMed gas pipeline tomorrow March 20th in the presence of US Secretary of State Mike Pompeo, in a sign of support from Washington for the project that is expected to transfer gas from the East Mediterranean Israeli and Cypriot fields across Greece and onto Italy.
The summit is expected to yield a short statement of intent by Israeli Prime Minister Benjamin Netanyahu, his Greek counterpart Alexis Tsipras and Cyprus President Nicos Anastasiades which Pompeo is expected to back, emphasizing the U.S. aim to create a security alliance in the region. Washington’s key interest in the trilateral summit is the prospects it opens up for enhanced security in the region and in the energy sector, followed by a possible cooperation in the development of new technologies. Pompeo’s presence in Jerusalem is also widely seen as an expression of support for Netanyahu, who is facing indictment on corruption charges ahead of parliamentary elections scheduled for April 9.
His presence in the signing of the EastMed pipeline, also sends a signal to Turkey and Russia about Washington’s willingness to protect its interests in the region. His presence is quite important as it signifies political support to the three countries, seen by the US as its friends in the region, but also as contributing to regional stability and security. It extends, however, to anything more than just political support.
Washington’s views on Eastern Mediterranean energy resources and routes
Important new developments, both geopolitical and practical, led to the renewed focus by Washington on energy development and security in the Eastern Mediterranean. Washington was impressed with the progress made in Trilateral Greece-Cyprus-Israel energy development and is eager to participate as a partner where possible. The U.S. has been very supportive due to its desire to counteract Russian gas to Europe, aiming to have American gas to Europe as well as other sources of gas to Europe, including East Mediterranean gas. At a strategic level, the proposed EastMed pipeline is an extremely important project that the United States strongly supports. It complements everything that it has been doing with the 3+1 meeting supporting the flourishing Greece-Israel relationship.
Nevertheless, the market is going to decide whether the pipeline is constructed. The construction of the EastMed is an extremely complex project, which some consider to be impossible, since according to the original design, the 1,900 km pipeline will be submerged in very deep depths and therefore has many difficult technical details. Τhey say that the EastMed is rather more of a political project with little chance of being built because of commercial reasons: it is expensive and the gas it plans to carry is also expensive. By the time it arrives in Europe it will not be able to find buyers, as it will not be able to compete with other gas supplies, on price.
On the other hand, the announcement of U.S. energy giant ExxonMobil on 28 February, that it has made the world’s third-biggest natural gas discovery in two years off the coast of Cyprus in the Eastern Mediterranean at the “Glaucus-1”, the potential for more discoveries offshore Cyprus, in the planned drillings and the exploration bids in the Exclusive Economic Zones in Greece and Egypt have fuelled plans for the export of hydrocarbons from the region to Europe, including the EastMed pipeline. While it’s not necessarily a game changer for exports, it’s a game changer because it renews the interest in the area and involves one of the biggest oil and gas companies in the world. It shows that the whole basin is gas-prone. If it had been another failed well, then it would have sort of put a dampening to further exploration.
It’s going to be a long process for ExxonMobil now to follow up its preliminary findings to determine the full scope of the resources that are available, and then to decide. And they have yet to decide whether to invest the billions of dollars that will be required to both extract the gas and then bring it to market. They have to decide is there enough gas to justify an LNG facility in Cyprus? Do they take it to Egypt? Do they plug it into the EastMed? And that in turn is affected by global market trends. So this is an issue that’s going to unfold over a matter of years and decades, not weeks.
Obviously the discoveries that ExxonMobil announced will have a positive impact on those market calculations, but certainly at the political level the United States is all in the Greece-Israel-Cyprus Trilateral. The Israeli government too, seems determined to go ahead with this big project.
Greece and Israel as “fronier states”
The U.S.A. values Greece’s increasingly important role in regional security. That is why the launch of the Strategic Dialogue by Secretary of State Pompeo and Foreign Minister Katrougalos in December and the active efforts that both governments are making to sustain that momentum, continue working in those lanes. Greece cooperates closely with the United States in terms of NATO platforms, the work at Souda Bay, the way in which both states work together on maritime domain awareness and security in the Eastern Med and the Aegean, at a moment when great power competition has returned to the region in a way that we have not seen for more than two decades.
Greece lives in a complicated neighborhood vis-a-vis Turkey to the east; but also a complicated neighborhood vis-a-vis North Africa and the Magreb, the refugee problem; vis-a-vis the Eastern Med, which in the past was basically a “lake” of the U.S. Navy’s 6th Fleet. Nowadays, there is a strong Russian naval presence in the region, a Russian base at Tartus and leveraging that to project power and influence into the wider neighborhood. However, Russia is not the only part of the story. So in this complicated region the United States, view Greece as a pillar of stability.
The deepening of the Greece-Israel relationship is a very important factor here. Greece and Israel both have important roles to play as western frontier states. The coming period will be characterized by challenges all along the periphery lines between the western and the Muslim worlds. This will not be a confirmation of the Clash of Civilizations of S.P. Huntington, because jihadist groups target Muslim states as well, but a recognition that a new era has arrived with frontier states having more responsibilities to strengthen collective security than before. The strong ties between Athens, Jerusalem, and Nicosia go well beyond the promotion of open communication links in the field of energy. The strategic triangle, and especially the close cooperation between Athens and Jerusalem, can help the rest of the western world obstruct jihadists as they attempt to target western states. How do Athens and Jerusalem help in this regard?
- By establishing a network of flow control of refugees now that Turkey seems unable and unwilling to do so. Jihadists make use of the continuous flow of refugees into Greece through the Aegean corridor in order to gain access to the West.
- By putting preemptive military operations into action from Greek, Israeli, and Cypriot ground against human smugglers acting in the Eastern Mediterranean. Greek military naval capacity combined with the Israeli military air force can transform the Eastern Mediterranean into a region relatively immune to external jihadist action.
Israel is a tech leader while Greece has a large soft power capacity. This combination can lead to the creation of a political narrative that can counter the power formula of jihadist Islam in the Eastern Mediterranean. For all of these to be implemented and to influence developments in the Eastern Mediterranean, the Middle East, and Southeastern Europe, the U.S. as well as the E.U. will have to maintain their open support to both states. The decision by the White House to move the U.S. Embassy to Jerusalem was a strong political gesture in this direction. So too should Washington enhance the status of frontier state to Greece. The radicalization of Islam will continue as a new generation of Takfirism, a hybrid form of nihilism and ultra-religious fanaticism, is growing in Libya, Syria, and the Sahel. The strategic importance of Israel and Greece as the last frontiers before the stormy Muslim archipelago, considering as well the Russian and Chinese poles of influence, reveals the embryonic capabilities the two states possess as the two major western actors in the region. (see also ENERGY WARS: The Security of the Energy Routes in the South East Mediterranean)
“An exciting time in U.S.-Cypriot relation”
Those were the words of the new U.S. Ambassador on the island Judith Garber, who replaced Kathleen Doherty, describing the relationship between the two countries nowadays. The interests of Cyprus and the United States in the Eastern Mediterranean -at the crossroads of Europe, the Middle East and Africa- have become increasingly aligned, and the Republic of Cyprus is valued as an important strategic partner in this critical region, especially because of its participation to the two regional Trilaterals with Israel-Greece and Egypt-Greece.
In the energy and security sectors, the U.S. plans to grow deeper and stronger their bilateral security partnership. Moreover after the discoveries that ExxonMobil announced recently. The United States lately, has consistently recognized -in public and in private- the right of the Republic of Cyprus to develop the resources in its Exclusive Economic Zone. It continues to believe these resources should be equitably shared between both communities in the context of an overall settlement, while regarding the Cyprus problem, the U.S. continues to support efforts by the leaders of the Greek Cypriot and Turkish Cypriot communities facilitated by the United Nations, to forge a just and lasting settlement that will reunify the island as a bizonal, bicommunal federation.
Turkey’s rather anguish response
Tomorrow’s Summit, also comes amid another public spat between Turkish President Recep Tayyip Erdogan and Israeli Prime Minister Netanyahu, as well as the negative U.S. report on human rights, the proposition of the E.U. Parliament’s proposal for the freezing of Turkish membership talks and, most importantly, the recession its economy entered. On top of all this, a strong statement of intent from the 3+1, to press forward with the pipeline and with a tighter security alliance in the region has rattled Turkey strongly, which has its own sights on energy resources in the area.
In what is seen as a response, Ankara has announced that it will start a naval exercise on the same day off the Mediterranean Cyprus’ southern coast and within part of its EEZ. The exercise will take place on March 20, 22, 25 and 27 and it has reserved a wide area south of Cyprus, including parts of blocks 1, 7 and 8 of the island’s EEZ. The choice of area came as no surprise, as the Turkish survey vessel Barbaros has been active in the area.
The two Turkish NAVTEX:
N/W : 0368/19 MEDITERRANEAN SEA
BILATERAL NAVAL EXERCISE WILL BE CONDUCTED
BY TURKISH AND ALLIED NAVAL UNITS
ON 20 MAR 19 FROM
0800Z TO 1800Z IN AREA BOUNDED BY;
35 20.00 N – 030 30.00 E
35 20.00 N – 031 58.00 E
33 40.00 N – 031 58.00 E
33 40.00 N – 030 30.00 E
CAUTION ADVISED.
Ν/W : 0359/19 MEDITERRANEAN SEA MILITARY TRAINING,
20 MAR 19 FROM 0900Z TO 1200Z,
22 MAR 19 FROM 0700Z TO 1000Z,
25 MAR 19 FROM 1300Z TO 1700Z,
27 MAR 19 FROM 0800Z TO 1300Z,
29 MAR 19 FROM 1100Z TO 1500Z,
IN AREA BOUNDED BY;
34 07.00 N – 033 00.00 E
33 34.00 N – 033 00.00 E
33 34.00 N – 032 30.00 E
34 07.00 N – 032 30.00 E
CAUTION ADVISED.
French Navy’s strong presence in the area
Turkey is strongly disturbed by the simultaneous French Navy’s large aeronaval exercises in the South-SouthWest of Cyprus, in a total expanse of 150,000 sq. Km. Some 30 Rafale jets are part of the Air Group on aircraft carrier “Charles de Gaulle” taking part in the exercise “FANAL 2019” and flew over Larnaca and Paphos on Monday, focusing on carrier strike group operations across all maritime warfare disciplines aimed to enhance performance and interoperability between participating naval forces. The USS “Donald Cook” is also taking part in “FANAL 2019” which will end on Wednesday March 20th. The newly upgraded and refurbished aircraft carrier, currently deployed in the Mediterranean, is reportedly on its last training drill before taking part in French operations against the Islamic State group in Syria. It will then hold joint maritime exercises with the Egyptian navy, the Indian navy and the Japanese Maritime Self-Defence Force.
The Cypriot Centre of Search & Rescue announced two NAVTEX referring to the “FANAL 2019” sea regions, as well as the Civil Aviatiion Authority the relevant NOTAMs accordingly. The flight security measures will be in “real time” cooperation with the French Navy. The second exercise area -the largest part of Block 8 and part of Block 7- which the Cypriot NAVTEX concernes, is identical with the one that the Turkish NAVTEX reserved for the Turkish Navy exercises at the same dates.
1 The first area is reserved by RoC for the French aeronavale exercises during 13-20 March.
2 The second area is reserbed by RoC for the French aeronavale exercises during 13-20 March.
3 The reserved area for the geological and environmental explorations by the research vessel “Naurical Geo”, on future targets for drilling in Cyprus’ EEZ.
4 The reserved area by Turkey for the its Navy’s exercises, for the duration of February and March.
5 The reserved area for the seismic explorations by “Barbaros”.
6 “Barbaros” recent course in Blocks 1,8 and 9 of Cyprus’ EEZ
It is worth of mentioning that its not a coincidence the fact that the Total-ENI concortium has started negotiations with Cyprus’ government for the cession of Block 7 and Total is in negotiations for Block 8 accordingly. The second area in Cyprus’ EEZ where the French Navy conducts exercises, is the same where the Turkish “Barabaros” does seismic explorations. Cyprus, which has filed a complaint to the United Nations over Turkey’s activities in the area, remains apprehensive over Ankara’s stated plan to beginning drilling for gas off the island’s southern coast.
Will the US and Turkey break up over Russian S-400?
Apart from the strong message the U.S. adminnistration sends with its participation to the Jerusalem’s Trilateral summit, it is also ramping up the pressure on Turkey, a NATO ally, over its decision to purchase S-400 surface-to-air missile systems from Russia. Washington says that the S-400s are not interoperable with NATO systems and would compromise the security of the F-35 fighters.
General Curtis Scaparrotti commander of U.S. European Command and Supreme Allied Commander of NATO, responded to a recent inquiry from the Senate Armed Services Committee as to what he would advise if Turkey went ahead with its purchase of the Russian S-400 air defense system: “My best military advice would be that we don’t follow through with the F-35, flying it or working with an ally that’s working with Russian systems, particularly air defense systems.”
Additionaly, the U.S. President Donald Trump sent a letter to Congress calling for the termination of preferential trade treatment for Turkey, reversing a long standing trend of handling issues with Ankara quietly and in private. Most of Turkey’s exports to the U.S. have enjoyed duty-free treatment since 1975. Nevertheless, Washington has sent too many mixed signals to Erdogan. This has allowed him to believe that “Turkey is too big to fail” in the U.S.’s estimation and that he can get away with taking delivery of the S-400 system.
After decades of using “honey” to attract Turkey towards the West proved insufficient, the Trump administration and Congress are turning to “vinegar”. Clarifying the consequences -on the trade front and the security relationship- that Turkey will suffer should it continue to pivot away from the West, might convince Erdogan that Washington’s bite will finally be worse than its bark. But as of right now, Erdogan is betting that Washington will blink first.
Italy: The big absentee…
Cyprus, Greece, Israel, and Italy have been discussing the EastMed natural gas pipeline project, for quite sometime now and were expected to sign an intergovernmental agreement, although this pipeline project is very complicated technically and commercially.
In the meantime, on 14 March Italian energy major ENI announced a new gas discovery under evaluation in the “Nour” exploration prospect located in the Nour North Sinai Concession, in the Eastern Egyptian Mediterranean, about 50 kilometres North of the Sinai peninsula. Even though ENI has not announced size, it has been rumoured to be substantial, with the lowest estimate being 10 trillion cubic feet. The company plans to start feasibility studies after finalising the discovery evaluation, to “… accelerate the exploitation of these new resources leveraging the synergies with existing facilities and infrastructures.” Coming on the back of the ExxonMobil’s discovery of “Glaucus-1” it was really good news for the EastMed pipeline, maintaing Egypt’s lead in the region reinforcing its growing LNG exports. Together with the new licensing rounds just announced by Egypt, the potential for more discoveries has been increased.
The original plan had been for the EastMed pipeline deal to be signed at the Wednesday’s summit, however that has been postponed amid political upheaval in Italy, where the pipeline would culminate. The “5 Stars Party” coalition member seems to be under pressure from various ecologic teams that object to the planned construction in Puglia, in the country’s south. The Italian government seeks a postponement of the signing till after May’s European Elections, hoping that will have more flexibility and able space for decissions.
Therefore, the project faces a potential massive challenge if Italy does not allow landing of the pipeline. Whoever the pipeline’s owners would be they would need to secure a different route, for example north through the Balkans. Not only this would delay the project, but also it would increase costs even further. However, the Italian position may change, especially after strong pressure by the rest of the stakeholders or a change of government.
