Sunday, 9 October 2016
Use Cyprus LNG Facility says BESA Report to avoid Islamist Turkey for Israeli Gas Export

The Triple Alliance: Cyprus, Greece and Israel

Source:  Dr. Rich Swier

In January 2016, we wrote  about the triple alliance formed with Israel, Cyprus and Greece for export of natural gas produced in their respective offshore Exclusive Economic Zones, “The Triple Alliance Eastern Mediterranean Gas Pipeline announced in Cyprus.”  We wrote:

Auspicious meetings were held in Nicosia, Cyprus with members of the emerging Trilateral Eastern Mediterranean Gas Pipeline alliance:   Israeli Prime Minister Benjamin Netanyahu, Cyprus President Nicos Anastasiades and Greek Prime Minister Alexis Tsipras.

The alliance was focused on the possibility of developing the Eastern Mediterranean Gas Pipeline with EU assistance to avoid the rising geo-political problems and desires of Turkey’s Islamist President Erodgan.   He prefers to have Israel  transport natural gas via a Turkish pipeline. However concerns with Turkey’s stability have arisen, with domestic turmoil as a result of the staged coup and purge by Erdogan. There is also his renewal of relations with Russia over the completion of the Turkish  pipeline have raised questions about the wisdom of that option. This is notwithstanding the reconciliation pact between Israel and Turkey reached in August.   In a September 2016, New English Review article, “Why are Turkey and Israel Reconciling,” we wrote:

There are compelling economic and security reasons for reconciliation between Turkey and Israel. One is significant tourism and economic trade between the two Mediterranean countries. Another is the attraction to Ankara of Israel’s development of major gas fields offshore in its Exclusive Economic Zone. That requires investments in pipelines for transporting it to both Turkey, for its internal needs, and prime markets in the EU. Erdogan had just concluded a deal with Russian President Putin in Moscow that would complete the so-called Turkish Stream pipeline. Israel’s gas would offer significant economic benefits to Turkey which, in turn, might invest in the submarine pipeline connecting Israel’s offshore gas fields to the Turkish Stream, estimated at $4 billion.

There is another option that we noted in our January 2016 Iconoclast post on the triple alliance, the existing option of an LNG facility in Cyprus:

There is the alternative of the onshore LNG facility at Vassilikos on Cyprus’ south shore to be built by the Consortium at an estimated cost of $10 billion. A Memorandum of Understanding for planning the Vassilikos LNG complex was signed by Cyprus and the Consortium in June 2013. In the interim, offshore floating LNG processing platforms that might be leased to ship processed gas via pressurized LNG vessels to receiving terminals in Greece and Italy. However, Noble Energy was not initially supportive of the Eastern Mediterranean pipeline option, instead concentrating on sales from Leviathan to regional users like Jordan and Egypt and building the proposed Cypriot LNG processing facility.

Given the rapidly changing geo-political conditions in the Eastern Mediterranean   the Cyprus option may now look preferable, given the deal struck by the Netanyahu government with the Leviathan gas field co-developers, Noble Energy, Inc. of Houston, Texas and Israeli partner, Delek Drilling Group. Ariel Ben Solomon, published commentary on why the Cyprus option is preferable in a recent Begin Sadat Center (BESA) Perspective Paper No. 370, “Israel Should Avoid Turkey, Include Cyprus in Gas Export Projects.”  His analysis suggests the geo-political preference for Israel to choose the Cyprus LNG option:

Israel should rule out building a natural gas pipeline to Islamist Turkey because of the political risk involved. It should instead consider using LNG technology for export through Cyprus. Although this would be expensive, it would be a less risky and a  more durable option over the long term. This should be in addition to exporting to Jordan and possibly to Egypt.

As Israel begins closing deals for its natural gas, it should avoid linking itself to any expensive long-term pipeline deal with Turkey at the expense of allies Cyprus, Greece, or even Egypt.

Notwithstanding the recent easing of tensions between the two countries, Israel cannot trust Turkish President Recep Tayyip Erdo?an’s Islamist regime as a linchpin in its natural gas export strategy.

A crisis could erupt at any moment that might cause Erdo?an, an erratic anti-Semite, to stop the gas from flowing, essentially holding Israel hostage. The trigger could be a new war with Hamas-ruled Gaza, which is allied with Turkey or a general escalation in violence with the Palestinians, or any of a host of other unexpected incidents. The deterioration of the already cool relationship is only a matter of time.

The recent improvement in ties between Israel and Turkey must be viewed within the context of the poor relations Ankara had with Russia and other states at the time, and should not be viewed as reflecting any real change in Erdo?an’s attitude toward Israel.

Solomon, the author of the BESA Perspectives report noted the comments of a Trump foreign policy advisor regarding the triple alliance option for Israel’s offshore gas projects:

Some still see Egypt as a viable option. George Papadopoulos, a foreign policy advisor to US presidential candidate Donald Trump, says that Egypt “faces its worst power crisis in decades due to long-term inefficiencies in the gas sector and is desperate for imported gas until its own legacy production ramps back up.” Egypt is weighing importing gas from Israel and Cyprus.

“The Israeli Leviathan and Tamar gas fields, along with the Egyptian Zohr and Cypriot Aphrodite, have the potential to be the linchpins that transform the region into an integrated energy zone,” he said.

Accordingly, a strategic relationship between Greece, Cyprus, Israel, and Egypt could involve energy cooperation around a prospective Cyprus hub. These countries are all ideologically opposed to Islamist Turkey’s agenda, and Greece and Cyprus have their own historical reasons for preferring cooperation with Israel over Turkey.

To that end, we suggest that Israeli PM Netanyahu didn’t concede anything in the reconciliation deal with Erdogan.  Especially in light of Erdogan’s internal Islamist suppression of secular and Kurdish opposition in the post coup purge, as well as,  the Syrian Kurdish autonomy  aspirations in northern Syria, Netanyahu would be well advised to follow Solomon’s and Papadopoulos’advice cementing the natural gas project of the triple alliance of Israel, Cyprus and Greece.



Posted on 10/09/2016 10:58 AM by Jerry Gordon
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