Shashwat Tiwari
The
race for energy resources is heating up in the East Mediterranean Sea.
In recent times, the discovery of natural gas off the
Israeli coast in the Eastern Mediterranean Sea (the Levant basin) has added a
new dimension to the Israel-Palestine conflict
zone.Significantly this has transformed the region into a potential
energy source, not only for domestic use, but also for the European and Asian
markets. However, the other political conflicts in the region- Syrian civil war,
Israel-Gaza conflict, and the maritime dispute between Israel and Lebanon- cast
a shadow on this economic opportunity. Moreover, the overall development of
these fields is at a nascent stage. Both EU and Russia are ready to exploit this
opportunity to maximise their strategic objectives.
In 2010, the US Geological Survey (USGS)
estimated that the Levant Basin, one of the eight basins in the Eastern
Mediterranean Sea region, may contain 3455 billion cubic meters (bcm) of
natural gas. Within the Levant basin, the natural gas reserves were discovered
in the Tamar and the Leviathan areas in 2009 and 2010 respectively, which have transformed
the Levant basin into a potential energy hub in the region. However, the
prospect of increased production continues to be hampered by the ongoing political
instability. Long-standing disputes such as Israel-Arab conflict also represent
a major challenge for the prospective development of these gas fields. Further,
the maritime disputes in the area have aggravated the existing regional rivalries.
Israel is one of the largest consumers of natural gas in the
East Mediterranean region, with an average annual consumption rate of 5 bcm (2011).This
is expected to grow to 9.7 bcm by 2015 and to 13.3bcm by 2020. To meet its
energy demands,Israelis largely dependent on natural gas imports from Egypt, and
imports nearly 40 per cent of its requirements (2010). The Israel-Egypt gas
pipeline is vulnerableto repeated attacks in the Sinai region of Egypt, and has
been closed since 2011 post Arab Spring regime change in Egypt. The discoveries
in Tamar gas fields and its operationalization in 2013 has given Israel an opportunity
to diversify its sources of energy requirements, and the discovery of theLeviathan
gas fields has revitalised the energy outlook of Israel. With these gas fields,
Israel can consider exporting natural gas to other countries in the region, as
well as to the European and Asian markets.
In 2012, Israel signed an agreement with the Palestinian
Authority to supply natural gas to the latter for a period of 20 years.Under
this agreement,the gas will be provided only to the West Bank. Israel has also
signed an agreement with Jordan for the sale of natural gas over the next 15
years. The hindrances created by the territorial conflicts among the regional
players have led to the involvement of global actors. Russia maintains good
relations with Israel, Syria and Cyprus, and appears to have capitalised on the
existing disputes. It seeks to dominate the Eastern Mediterranean gas market in
order to safeguard its position as a principle gas supplier to Europe. In 2014,Russia
signed an agreement with the Palestinian Authority to invest US$1billion to
develop the Gaza offshore gas fields. It has also inked a deal with Syria in
2013,which provides for controlling interests for the Russian Central Bank over
850 square-mile area of Syrian Exclusive Economic Zone (EEZ) for a period of 25
years. This will eventually lead to natural gas exploration by Russia in the
Syrian EEZ. Furthermore, Russia is in talks with Israel to develop the
Leviathan gas fields. Moscow is also offering financial support to Cyprus,
while backing Cyprus in its territorial dispute with Turkey.
Thus, through large scale investments, Russia
seeks to be in a position to be able to influence all major regional players,
who have developed economic interests in the Levant basin.It can be further
argued that Russia is trying to fill in the strategic vacuum created by the
declining influence of the European Union (EU) and the US.Russia has extensive
investments in the region, which raises the stakes for Russia to ensure the
political stability of the region, and thereby secure its investments.Russia is
alsoperceived as a more dependable ally in comparison to the EU or the US because
of its non-interference in the internal affairs of the regional countries.
According to a study conducted by EU’s policy
department over “the prospect of Eastern Mediterranean gas production as an
alternate energy supplier”, it is evident that the EU is possibly searching for
a possible alternate energy sourceto reduce its energy dependence upon Russia. Russia
has often used its position as a primary source of energy supply to EU to its
advantage;recent crises in case of Crimea or the crisis in Eastern Ukraine, validating
EU’s concerns.It’s in the EU’s interest to encourage the development of East
Mediterranean gas fields, so as to reduce its dependence on Russian energy
supply, as well as to check Russia’s growing geopolitical influence in this
region.
In this setting, it appears that the competition over energy
resources between Russia and the EU is shifting to the East Mediterranean
region (the Levant Basin), that can potentially complicate the geopolitical
predicaments of the region.
( Shashwat Tiwari is research associate for West Asia and Energy
Security at National Maritime Foundation( NMF), Delhi. This piece was first published on the website of NMF http://www.maritimeindia.org/Archives/THEGREATENERGYGAME.html)
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