Renewed Turkey-Israel ties could herald new gas deal

The normalisation of Turkish-Israeli political and diplomatic ties, possibly paving the way for lucrative Mediterranean gas deals, could impact Cyprus, although in what way is not yet clear, an energy analyst has told Cyprus Mail.

It could encourage Turkey to promote a settlement of the Cyprus problem, on the other hand, both Israel and Turkey could by-pass Cyprus, in the energy field.

Israeli Prime Minister Benjamin Netanyahu talked up the deal with Turkey, saying it would have “immense [positive] implications for the Israeli economy,” Turkey’s PM Binali Yildirim appeared less forthcoming, saying it was too early to talk about gas deals with Israel.

However, Turkey’s gas deal with Russia expires early next decade and Ankara is aware of the need to diversify its gas sources.

South Cyprus Foreign Minister Ioannis Kasoulides, said on Monday that Netanyahu had reassured President Nicos Anastasiades by telephone, a few weeks ago, that the agreement with Ankara would not affect, in any way, Israel’s relations with Cyprus.

He added that Netanyahu called the president himself to give his reassurances, and that Nicosia was told to expect another call from the Israeli premier after the agreement with Ankara was signed.

Just because a country improved relations with Turkey, Kassoulides said, did not mean that it was necessarily a negative thing for Cyprus.

However, the agreement between the two neighbouring nations does give the South food for thought.

It is well known that energy companies in Turkey and Israel continued their contacts throughout the six-year rift between the two countries.

Now, says energy expert Charles Ellinas, the proposed sale of Israeli gas to Turkey might pick up where it left off.

A number of Turkish companies expressed an interest when US energy giant Noble discovered massive gas reserves in Israel’s Leviathan field. Noble invited tenders for the sale of 8-10 billion cubic metres of gas to Turkey. However, after the Mavi Mara incident, the project was shelved. Now with the normalising of ties between Turkey and Israel, Turkish energy companies are now offering Israel an additional incentive to build a pipeline themselves. Noble Energy would therefore only have to construct a Floating Storage and Offloading vessel.

Although Israel would prefer to have the consent of South Cyprus, there is nothing in law which could stop such an arrangement as technically, EEZ’s are not considered sovereign territory.

Cyprus Mail

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