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Economy

ExxonMobil Gas Find Makes Cyprus Geopolitical Battleground

March 4, 2019

With Turkey in the mix and trying to keep foreign energy companies from drilling off Cyprus, where it has unlawfully occupied the northern third since a 1974 invasion, the discovery by the US giant ExxonMobil of gas off the coast has set the stage for a growing US presence in the region.

American and Cypriot sources who weren’t identified told Kathimerini that the find will have significant commercial and geostrategic consequences for the island and the wider Mediterranean with Turkey claiming some of the same waters, Greece wanting to explore them for energy and Turkish warships a catalyst.

The discovery of a big field of gas means ExxonMobil, which defied Turkish President Recep Tayyip Erdogan’s warning to stay out after Turkey had scared off the Italian company ENI, will stay in the island’s Exclusive Economic Zone (EEZ) under the watchful eye of the US, which has ships from the Sixth Fleet in the region.

The newspaper said the heightened level of US interest, after Washington had persisted in defending Cyprus’ right to license companies to research the waters, will be shown by having Secretary of State Mike Pompeo participate in a trilateral summit of March 20 in Israel between Greek Prime Minister Alexis Tsipras, Cyprus President Nicos Anastasiades and their host, Premier Benjamin Netanyahu, in Israel.

That will take place in the aftermath of a deal that Greece, Cyprus and Israel made at the 5th Trilateral Summit in December to construct the East Med pipeline that will transfer natural gas to Europe.

The presence of ExxonMobil, along with France’s Total and Italy’s ENI, signifies an ever-stronger Western presence in the region, the paper said, with France also talking a defense deal with Cyprus and eager to protect its company there, although Italy didn’t send any ships to protect ENI when its research vessel was scared off by Turkish warships.

Erdogan, who is opposed to Cyprus energy plans, said that his country’s second drill ship, the Yavuz, will start operations in the Mediterranean after maintenance and renovation work and challenge the foreign companies in the area.

“We bought our new ship and named it Yavuz. Yavuz will also start drilling work in the Mediterranean,” Erdogan said although he backed off vows to directly confront the foreign companies and as Turkish officials said they weren’t scared by the US Sixth Fleet either.

Cyprus’ Parliament agreed to set up an investment fund setting any potentially lucrative revenues to be set aside for future generations, not spent.’

Averof Neophytou, leader of the conservative Democratic Rally party said all the monies would be reserved. There was no explanation whether, as Cypriot President Nicos Anastasiades had said, whether they would be shared with Turkish-Cypriots.

Anastasiades, hailing the fund’s approval on his official Twitter account said it rules out disbursements but would also safeguard the rights of Turkish-Cypriots to to any hydrocarbon wealth.

According to the preliminary interpretation of the data, the natural gas reservoir at the Glaucus-1 well is estimated between 5 trillion to 8 trillion cubic feet, Kathimerini Cyprus said in a report. ExxonMobil said it will analyze the data in the coming months to better assess the field’s potential.

The find comes as the United Nations is trying to restart unity talks that collapsed in July, 2017 at the Swiss resort of Crans-Montana when Anastasiades walked away after Erdogan and Turkish-Cypriot leader Mustafa Akinci said they would never remove an army there and wanted the right to militarily intervene again when they wanted.

Anastasiades had agreed to share potentially lucrative energy revenues with the Turkish-Cypriot side but Akinci and Erdogan said they also wanted Turkish-Cypriots to take part in the licensing process.

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