East Mediterranean partnership signals an energy revolution

Natural gas has turned Greece from a rival to an ally just as relations between Israel and Turkey started deteriorating.

By EMMANUEL NAVON
December 1, 2018 22:24
3 minute read.
Greece

Greece. (photo credit: Courtesy)

 
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The announcement in November that Israel, Cyprus, Greece and Italy have agreed to build a natural gas pipeline (the longest in the world) from Israel’s offshore gas fields to Europe, clearly indicates that Israel has chosen the Greek option over the Turkish one. In the past, Israel had considered a pipeline to Europe via Turkey, but the idea was dropped in favor of the Greek option.  Building a natural gas pipeline via Turkey would have been cheaper and more viable economically, but it became politically unfeasible due to Turkey’s hostile policy toward Israel, Cyprus and Greece.

Natural gas has turned Greece from a rival to an ally just as relations between Israel and Turkey started deteriorating. Israel discovered the huge Leviathan gas field in 2009, shortly before the 2010 MV Marmara incident, which contributed to the rift between Israel and Turkey. In 2010, Benjamin Netanyahu became the first sitting Israeli prime minister to visit Greece, and the Israeli and Greek air forces started their first joint military exercises. In September 2011, Israel and Greece signed a security cooperation agreement. Israel now uses Greek airspace for training purposes.

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Turkey is opposed to the Israel-Cypriot partnership in natural gas, but it has not been able to stop it. In 2014, for example, Turkey violated the Cypriot EEZ (Exclusive Economic Zone) to try and block Cyprus’ exploitation of its natural gas. Turkey is energy-dependent and heavily relies on Russia. Turkey sees Israel as a potential supplier of natural gas, but relations
have deteriorated and Israel and Turkey are unlikely to team up on natural gas. While it seeks to reduce its natural gas dependence on Russia, Turkey has been bypassed by the pipeline project concluded between Israel, Greece and Cyprus.

This is a blow to Turkey as it is trying to reduce its dependency on Russia. Turkey imports 99% of its natural gas (60% of which comes from Russia), and the gas produces half of its electricity.  Israel and Turkey have been discussing an agreement for natural gas supply. However, the talks so far have not progressed due to political tensions between the two countries. 

Israel, Greece and Cyprus benefit from the natural gas partnership. Israel acquires stronger leverage and strategic value vis-à-vis the European Union by becoming a natural gas exporter. Greece is acquiring the status of an energy hub. Cyprus gains regional and international importance. Israel, Greece and Cyprus are also increasing military cooperation.

THE NEW natural gas partnership in the Eastern Mediterranean has the potential to play an important role in Europe’s effort to diversify its natural gas exports and to reduce its dependency on Russia.


Greece’s partnership with Israel is boosting its status as energy hub, which it started acquiring in 2013 with the decision to build the Trans Adriatic Pipeline, which will transport gas supplies from Azerbaijan to the EU via Turkey, Greece, Albania and Italy. Greece also has the potential of becoming a natural gas exporter in its own right. Studies conducted by Norwegian company Petroleum Geo-Services in 2012 and 2013 suggest the possible existence of oil and gas resources in Greece (south of the island of Crete).

Another major natural gas player in the region is Egypt, which also has large natural gas reserves. Its Zohr gas field, which was discovered off its northern coast in 2015, is the largest in the Mediterranean (it is nearly twice the size of Israel’s Leviathan). Yet because Egypt has 95 million inhabitants and high population growth, it needs its natural gas for domestic consumption. Indeed, Egypt will likely need to import natural gas to meet its needs even after Zohr becomes operational, and those needs can be met by Israeli exports.

It would make sense for Israel to develop an energy partnership with Egypt because Egypt has two natural gas liquefaction terminals (which Israel lacks), via which Israel could export liquefied natural gas to Europe. A partnership between Israel and Egypt was unthinkable Egypt was ruled by the Muslim Brotherhood between 2012 and 2013. Israel’s security cooperation with Egypt has been restored and expanded by Egyptian President Abdel Fattah el-Sisi. 

The emerging east Mediterranean partnership for natural gas is no less than revolutionary. Historically, energy was the Achilles’ heel of Israel’s foreign policy. It is now an asset, thanks to the decline of the “oil weapon” and to the increased importance of natural gas in the world energy market. Thanks to the new pipeline, Israel will eventually become a natural gas exporter to Europe, without depending on Turkey. This tectonic change will grant Israel increased leverage in its relations with the EU. 

The writer is a fellow at the Jerusalem Institute for Strategic Studies.

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