Potential Gas Conflict in East Mediterranean

A mixed Blessing

By Nizar Abdel-Kader

In January 2009, Israeli oil company Delek and US Noble Energy Company discovered (some 55 miles off the coast of Haifa) a large natural reservoir known as "Tamar", which holds an estimated eight trillion cubic feet of gas. Early in 2010, another offshore gas field called "Leviathan" with a potential of 16 trillion cubic feet was discovered. Once exploited, these two fields could provide Israel with more than its domestic demand and turn Israel into a major exporter of natural gas.

Subsequently, in 2012, Cyprus, with the help of an Israeli company and Noble Energy, discovered a gas reservoir that could make the small island energy independent for 200 years. This gas find of eight trillion cubic feet was called "historic" by the Cyprus government. According to a press announcement by Charles D. Davidson, Noble Energy's president, this was the fifth natural gas field discovered by Noble Energy in the Levant Basin. A US geological survey published in 2009 claimed that there were 122 trillion cubic feet of recoverable gas off the coasts of Syria, Lebanon, Cyprus, Israel and Gaza, in addition to 1.7 billion cubic meters of oil.

Awakened by the Israeli gas discoveries, Lebanese politicians made a series of provocative statements, and Hizballah issued a warning pledging to defend Lebanon's natural resources. Israel responded in kind, stating that its military would not hesitate to protect the gas fields.

After several months of political bickering, Lebanon's parliament endorsed in August 2011 a draft law demarcating the country's maritime boundaries with Israel and Cyprus. A few months later, the Israeli government unilaterally mapped out Israel's maritime boundaries with Lebanon, which Lebanese authorities (as well as Hizballah) argue infringe on Lebanon's economic zone by 850 square kilometers. As a matter of fact, Lebanon earlier reached an agreement with Cyprus, but the agreement was never ratified by Lebanon due to fears that the Turkish government might express reservations, thus jeopardizing economic interests between Turkey and Lebanon. Lebanese authorities have asked the United Nations to help in establishing a temporary sea boundary between Lebanon and Israel, a maritime line equivalent to the blue line established by the UN in 2000, but the UN has been reluctant to assume this potentially thankless task.

Both Israel and Lebanon have trillions of cubic feet of underwater natural gas and can benefit tremendously from these resources. However, the problem remains that they need UN assistance in facilitating indirect negotiations between them to help demarcate the boundary line. Such a process usually occurs through bilateral negotiations or mutually-agreed arbitration. However, because the two countries remain in a state of war, no such opportunity exists. Experts advise that Lebanon and Israel could exploit the gas in the disputed area jointly through what is called "unitization" by dividing the gas then together developing the reservoir according to each side's relative portion. Otherwise, each side could drill separately, but this practice would be damaging to the reservoir.

Turkey, in turn, has placed additional pressure on Cyprus by declaring the island's maritime agreement with Israel null and void. According to the Turkish government, Turkish Cypriots also have rights and jurisdiction over maritime areas of Cyprus. The Turkish official position went as far as to start Turkish exploration around Cyprus.

Taking into consideration the conflicting positions of the various nations involved, one can see that the issue of gas and oil discoveries in the Levant Basin is a highly complicated matter politically, legally and strategically. Of course, it remains within each state's authority to defend its rights with regards to its own exclusive economic zone, which should be set based on the 1982 United Nations Convention on the Law of the Sea. But such steps might not be enough to solve the clash of interests among the various states involved, and there may be a need for a regional conference sponsored by the UN with the main task of facilitating negotiations between Lebanon and Israel, as well as between the Turks and Greek Cypriots. Such international negotiations and arbitration appear necessary to avoid future military conflict.

The discoveries of gas fields by Israel and Cyprus are stirring the pot of regional turmoil and provoking various reactions from the other players in the Eastern Mediterranean. It looks as if the region is on the verge of a very volatile and highly complicated situation.

It is perhaps no surprise that the sudden interest of Hizballah in the potential hydrocarbon wealth of the Israeli and Lebanese coastlines could turn the Mediterranean into a new theatre of conflict along the lines of the conflict over the Shebaa Farms. It remains the responsibility of the Lebanese government to approach the gas fields in a practical (not political) way, as it did with the Shebaa Farms.

To avoid future tensions between Lebanon and Israel and to prevent Hizballah from creating another border conflict, the US government is advising both Lebanon and Israel to focus on benefitting from the gas reserves instead of using them as the grounds for a new dispute. Of course, the US priority is centered on regional stability and the protection of US companies working for Israel and Cyprus.

All governments concerned should realize that in order to exploit such huge underwater gas reserves, they will all need to attract immense foreign investment that will not be available unless they manage to promote a peaceful and stable environment among them.