Oil and Gas Exploration Operations in the Eastern Mediterranean: A Blessing or a Curse? M. Ergün Olgun, Former Undersecretary of the Presidency of the TRNC cited the case of Sudan to call on the two sides of Cyprus for cooperation on hydrocarbon operations.

ANKARA – TEPAV and the Middle East Technical University (METU) Center for European Studies jointly organized a meeting on the ongoing oil and gas exploration operations in the Eastern Mediterranean. The meeting, held on Friday, 3 February 2012, hosted M. Ergün Olgun, Former Undersecretary of the Presidency of the Turkish Republic of Northern Cyprus (TRNC). Olgun stated that the operations could become a “peace project” if the two sides of Cyprus acted in cooperation and fairness. He said that Southern Cyprus, however, had been acting independently. Describing the situation as either “a blessing or a curse,” he pointed at the Sudanese experience in reference to the link between the discovery of hydrocarbon and ethnic/religious clashes.

TEPAV watches the developments on Cyprus

Professor Atilla Eralp, director of the TEPAV International Policy Research Institute and head of the METU Center for European Studies, moderated the meeting, with the theme “Hydrocarbon Policies in the Eastern Mediterranean and Cyprus.”  Delivering the opening remarks, he drew attention to the current transformation process in the Eastern Mediterranean. Stressing that the political developments known as the “Arab spring” as well as geopolitical developments triggered by the hydrocarbon operations had been influencing regional dynamics, he maintained that TEPAV would concentrate more on Cyprus, an issue that had lost popularity in Turkey.

Olgun started his speech by citing figures on the estimated hydrocarbon reserves of the Eastern Mediterranean. He said that 70 percent of the oil demand of Europe was transported through the Mediterranean and that the Eastern Mediterranean had hydrocarbon reserves of 60 billion barrels, an amount which could meet Europe’s demand for thirty years. He added that Cyprus, which was located near these reserves in Lebanon, Syria and Israel, was estimated to hold 3.45 trillion cubic meters of natural gas and 1.7 billion barrels of oil.

Stressing that this huge potential could bring about a struggle for sharing the water area, he cited the regulation in the UN Convention of 1982 on the Law of the Sea on exclusive economic zones (EEZs) that defines the area through which the coastal nation has sovereign rights over all resources. He maintained that the breadth of EEZs is defined on the basis of the equality principle and in this context criticized the delimitation policies of Southern Cyprus.

“The agreements initiated by South Cyprus are unacceptable”
Olgun stated that despite the absence of any settlement between the Northern and Southern Cyprus on the resources of the island and any legal or operational right, Southern Cyprus had been acting independently, ignoring the rights of the Northern Cypriots. Recalling the fact that Southern Cyprus had signed an EEZ agreement for hydrocarbon with Egypt, Lebanon and Israel on the basis of the median line principle, he continued:

“Turkey is among the largest Eastern Mediterranean countries in terms of size and population. The agreements Southern Cyprus has signed on the basis of the median line principle, ignoring the principle of equality and the rights of Northern Cypriots, are unacceptable. The mentioned agreements have violated the rights of the Egyptians, Syrians, Lebanese, Israelis, and Palestinians as well.”

“The Blue Marmara connection…”
Olgun argued that the after becoming a member to the European Union, Southern Cyprus had started to seek alliances in the region and on hydrocarbon operations. Maintaining that Israel had signed the said EEZ agreement following the Blue Marmara incident, he said that the hydrocarbon issue had a role in the state of Turkey’s EU accession process.

He stressed that the Southern Cyprus, despite all the warnings and calls for common action, in September had initiated exploratory drilling with US Noble Energy, which had purchased one of the thirteen oil exploration fields. Three days later, the TRNC had licensed the Turkish Petroleum Corporation (TPAO) for exploration around the Island. The steps Turkish Cypriots had taken in goodwill for reconciliation were not responded to positively. The TRNC had proposed the mutual suspension of exploration operations until a comprehensive solution was reached or a joint committee, on which the UN would participate, was established.

“The first actual state since 1974…”
Stating that the initiation of the exploration activities by the TPAO was the first actual activity on the island by a Turkish corporation, he argued in this context that Southern Cyprus did not have a strong hand.

“The Turkish side seeks a win-win case in terms of both the partnership negotiations and the hydrocarbon issue,” he said. Both sides of the Island had to act in cooperation and justice, and water as well as energy resources had to be shared. This way the process could facilitate peace. The negotiation schedule foreseen by the UN was coming to an end. A death blow to the option of a federal union could be dealt, given that the Southern Cyprus was to take over the EU presidency, political developments and single-sided steps about hydrocarbon.

“The most economical option is to deliver hydrocarbon through Turkey”
On the other hand, he stressed, the most economical way to deliver hydrocarbon to other markets was through Turkey.

The meeting, attended by the foreign mission, academia, and civil society groups on foreign relations and energy continued with questions and contributions from the audience. Energy transmission and Turkey’s stance on the process were primary issues. Other issues discussed were figures about the reserves as revealed by exploration operations, the possible attitude of the US, and the positions of the countries of the region.