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26/07/2016

Cyprus and Turkey clash over oil exploration

Enlargement

Cyprus and Turkey clash over oil exploration

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Cyprus said on 10 June it would press on with offshore oil exploration, despite strong objections from Turkey, and would open new fields for hydrocarbon research by early next year.

Cypriot Industry Minister Antonis Paschalides told Reuters in an interview that Turkey's decision to send warships to the area last year had not deterred investors eager to search for oil and gas in the eastern Mediterranean. 

The first exploration deal was clinched with US company Noble Energy, which has already found a large gas reservoir off nearby Israel. 

"The first round has been completed," he said. "We expect that around the end of this year, the beginning of next, we can proceed with the second licensing round." 

In 2007, Cyprus launched its first licensing round for hydrocarbons in 11 offshore blocks, most in deepwater locations, despite objections from Turkey, which invaded the north of Cyprus in 1974 after a brief Greek-inspired coup. 

In November last year, EU member Cyprus protested to the United Nations that Turkish warships had repeatedly harassed Norwegian research vessels off the southern rim of the island over blocks earmarked for exploration. 

Turkey, which lies north of Cyprus, said the research ships had encroached on its continental shelf. 

On Wednesday, Turkish officials called on Cyprus to abandon the project, saying the Greek Cypriot government in the south did not represent the whole island. 

"We expect the Greek Cypriot authorities to end their calls for international tender," said a Turkish foreign ministry official who requested anonymity. "Insistence […] will adversely affect the peace and stability on the island of Cyprus, as well as in the Eastern Mediterranean region." 

Paschalides said the incidents involving Turkey were not deterring companies from a second round, which would offer 12 blocks in a process where companies acquire data with the option of moving on to exploration, then exploitation. 

"From the interest shown, there is no discouragement. We are optimistic that big companies are interested, international companies from many countries such as the United States, Russia, China and European countries." 

Israel's find encouraging

The 12 plots include 10 from the first round but with more research data, and another two which have just opened for exploration. 

Cyprus, over-reliant on heavy fuel oil imports and slow to switch to cleaner energy, was encouraged by Israel's discovery because the area is only 65 km from the Cypriot field that Noble Energy will be exploring. 

"We are optimistic if we take into account the Israel plot, where huge quantities of gas were found, neighbouring our own," Paschalides said. 

Asked whether Cyprus would change its planning after Turkey's reaction, he said: "Not at all […] any natural wealth of Cyprus belongs to the Republic of Cyprus and the Cyprus people, and only them. We wish that the Cyprus problem would be solved so the Turkish Cypriots, as citizens of this Republic, could reap the same benefits." 

Turkish Cypriots in the north of the divided island say their Greek Cypriot rivals have no authority to explore for oil or gas and have warned the dispute could upset reunification talks. 

Paschalides said Cyprus would continue to block EU aspirant Turkey's energy negotiations with Brussels as a result of this dispute and intended to open more areas for exploration in future. 

"How can Turkey stake claims and want to get into Europe, want to open the energy chapter, yet question the sovereign rights of an EU member state?," he said. "What will Turkey do? Go and attack US research vessels?" 

(EurActiv with Reuters.) 

Positions

Greek Cypriot government spokesman Stefanos Stefanou said on 10 June that his country will continue to block the energy chapter in Turkey’s EU accession talks due to a dispute over offshore oil and gas exploration, Turkish daily Hurriyet reported. 

Stefanou was quoted as saying that his government would continue to efforts to freeze EU-Turkey energy talks as a result of a Turkish naval ship's interference with a Greek Cypriot offshore fossil fuel survey. 

Energy is one of eight negotiating chapters that are currently suspended as a result of Turkey's refusal to open its air and sea ports to Greek Cypriots, the Turkish daily further writes. 

Background

Cyprus has been divided since 1974, when the Turkish military invaded the northern part of the island in response to a coup, inspired by the military junta in Athens, to unite the island with Greece. UN-sponsored talks between the Greek Cypriot president, Glafcos Clerides, and the leader of the Turkish-occupied north, Rauf Denktash, in the 1980s and 90s collapsed, with neither capable of persuading their people to compromise. 

The north, recognised only by Turkey, slid into poverty and corruption, while tourism and offshore banking brought prosperity to the south. 

Hopes were raised in 1992 when UN Secretary-General Kofi Annan presented a reunification plan, suggesting a two-part federation with a rotating presidency. But while Turkish Cypriots were in favour, Greek Cypriots rejected the plan in a referendum in 2004. This disappointed EU officials, who had agreed to allow Cyprus to join that year partly in the hope it would encourage a solution to the Cyprus problem. 

The election of Demetris Christofias as president of Cyprus in February 2008, thanks to his good personal relationship with the leader of the Turkish community Mehmet Ali Talat, who is also a leftwing leader, brought with it encouraging prospects for the reunification of the island. Ever since, reunification talks have been discretely ongoing between Christofias and Talat, under the watch of Alexander Downer, the UN's special advisor on Cyprus and a former Australian foreign minister. 

However, last April, Turkish Cypriot hardliners swept to victory in parliamentary elections in northern Cyprus (EurActiv 20/04/09). This could hamper reunification talks, analysts warned. 

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