Dividing spoils of natural resources

A report written by By Simon Bahceli and published on the Cyprus mail today says that with Cyprus and Turkey sliding headlong towards a clash over hydrocarbon resources in the eastern Mediterranean, Turkish Cypriots - whose rights Turkey says it is protecting by obstructing Greek Cypriot exploration - appear oblivious to the possible benefits to their community if the exploration and subsequent extraction went ahead.

So far, claims the article, the north’s leaders have said little, repeating only the mantra that the Greek Cypriots’ “unilateral” exploration and drilling would irreparably damage already-faltering reunification talks. It would also be in breach of the constitutional bicommunality of the Cyprus Republic, they say. Discussion of the benefits are few and far between, while nearly all of the talking, supposedly on behalf of the Turkish Cypriots, has been done by Ankara. Rational discussion of the issue in the north has been effectively drowned out.

Turkish Cypriot mistrust of the Greek Cypriot leadership is an unfortunate reality, says the article. And adds that the reason for this is because too many simply do not believe pledges from the south that they will share the offshore natural resources with “all Cypriots”. 

Some still hark back to long-past, pre-invasion days when Greek Cypriots had the upper hand in all walks of economic life. This, coupled with Ankara’s insistence on upping the heat by issuing threats to use its navy to halt the drilling, has only helped divert attention from what is really at stake. 

Making matters worse, Ankara has more recently managed to link its protests against Cyprus to its mounting rage against Israel over that country’s non-apology for the Mavi Marmara incident. Nothing but the rather ominous power-political implications are being discussed in the Turkish-speaking world today, according to the author.

The article says that it is not only Greek Cypriots who feel the Turkish Cypriot community, and Turkey too for that matter, should wise up to the massive boon the island may be about to receive if exploratory drillings go ahead in Cyprus’ Aphrodite field deep below the eastern Mediterranean this autumn. Regional editor of the Middle East Economic Survey (MEES) Gary Lakes believes the financial and environmental benefits could be massive for all on the island. Furthermore, he envisages significant benefits for Turkey too - but only if rationality was somehow, miraculously allowed to prevail. 

As Lakes points out, Noble Energy, the Texas-based company that plans to carry out an assessment of deposits in the Aphrodite field next month, has estimated that around 280 billion cubic metres of natural gas lie in wait below the seabed. If these estimates are proven accurate, Cyprus will make billions of euros in revenue, and will be awash with cheap and cleanly-produced electricity. Lakes says Cyprus’ predicted annual demand for natural gas in 15 years will probably be around 1 billion cubic metres per year. The Liquid Natural Gas (LNG) plant Noble Energy has proposed building in Cyprus would handle around 15 billion cubic metres per year. This means plenty to sell on to lucrative markets in fuel-hungry Europe.

While Lakes says much depends on whether the Aphrodite’s deposits are as big as predicted, and of course the market price, some have predicted that Cyprus could earn up to €10 billion annually from the gas. If this were the case, the Turkish Cypriot community’s share of the earnings (if the Greek Cypriots keep their promise) would outstrip many times over the aid Ankara provides. Moreover, these earnings would be rightfully earned, as opposed to handouts that have created dependence and have to a great extent stripped the community of its self-esteem.

There are other equally important benefits, such as the fact that burning natural gas to make electricity will greatly reduce carbon emissions and improve the general air quality around power stations. Turkish Cypriots know too well the damage their two dated generators do to the areas they occupy.

And it is not only the Cypriots that could stand to gain from the deposits, says Lakes. Turkey could benefit by transporting Cypriot natural gas through its Nabucco pipeline in Anatolia directly into western Europe. According to Lakes and other experts, this would be by far the most cost effective way of transporting the gas.

“If the situation were different, then it could be piped through Turkey. It’s a shame that the political situation prevents it,” Lakes says, concluding: “There is too much politics in the mix”

With the first gas not due to arrive till at least 2014, Greek Cypriot head of Energy Services Solon Kassinis is calling on Turkish Cypriots to, rather than paying lip-service to Turkey’s threats, “join forces with Greek Cypriots” to make the project work.

“If they don’t choose to work with us on this, they will lose a lot,” he predicts.

Kassinis insists he has done much to try and convince Turkish Cypriots that Cyprus’ hydrocarbon deposits are the property of all Cypriots, and that they should shun Turkey’s efforts to politicise the situation. He adds that plans for an LNG terminal include a blueprint for an infrastructure that would take the gas to all parts of the island, “including the north”.

“We’re not going to sell it or take it away from the Turkish Cypriots or the Maronites, or any other resident of Cyprus,” he told the Sunday Mail. He also called for patience and a political climb-down, at least until it became clear what deposits are there. “At the moment we are just looking to see what is there, and will only be able to tell you what we have after we verify the reserves,” he said. 

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