Turkish energy hub plan faces hurdles

May 9, 2013 at 4:45 PM
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TEL AVIV, Israel, May 9 (UPI) -- Israel's rapprochement with onetime strategic ally Turkey is a vital element in Ankara's drive to become the intercontinental east-west energy hub in the Mediterranean and many expect it to produce an energy alliance that will transform the region.

Turkish Prime Minister Tayyip Recep Erdogan has, since taking power in 2002, transformed his country's economic prospects through a wide-ranging diplomatic drive aimed at restoring Turkish leadership in the region.

He has long sought to transform Turkey, which has no energy resources of its own, into the unassailable central hub for transporting oil and gas from the eastern Mediterranean, the new hot zone, to Europe and maybe to Asia as well.

So there's a powerful geopolitical ambition, rather than a simple commercial objective behind Erdogan's push for energy glory and for Israel to participate.

But there are important technical and geopolitical hurdles to overcome before this or similar plans can be put into action to tap into the estimated 122 trillion cubic feet of gas the U.S. Geological Survey says lies under the Levant Basin.

"The easiest way for Israel to sell the resource abroad would be to build a pipeline running along the coasts of Lebanon and Syria end eventually reaching Turkey," the U.S. global security consultancy Stratfor said.

"But Lebanon and Syria are openly hostile to the idea. Even if they agreed, neither country has a government stable enough to secure such a project in perpetuity."

Syria's torn by a bloodbath of a civil war now in its third year and that's increasingly spilling over into volatile Lebanon which could, within months, become part of the conflagration on Israel's northern border. Ditto Jordan.

Israel, with its Tamar and Leviathan fields containing some 30 tcf, had sought to make common cause with Cyprus, whose fields abut Leviathan.

They'd been discussing joint exports, possibly through a pipeline to Europe via Greece. But the rapprochement between Israel and Turkey, and Cyprus' 2012 economic meltdown, pretty much put paid to that.

The Turks were also galvanized by attempts by Russia, Turkey's rival and the main gas exporter to Europe, to grab a stake in the eastern Mediterranean.

"Russia wants to ensure that any prospective energy exports to Europe that circumvent the Russian mainland still require a Russian signature," one industry insider said.

The Israel-Turkey rapprochement was engineered to a large extent by U.S. President Barrack Obama when he visited Israel in March, with particular U.S. geopolitical objectives in mind.

The confrontation between the two regional military heavyweights was a major setback for U.S. policy in the Mideast at a time when American influence was waning in the aftermath of the Iraq and Afghanistan wars.

Israel and Turkey split after the Israeli navy intercepted a Turkish flotilla of civilian vessels carrying humanitarian aid to the blockaded Gaza Strip May 31, 2010, and killed nine Turks.

Ankara was dismayed to find that the Jewish state then set aside old tensions with Greece, Turkey's traditional rival, and war-divided Cyprus, dominated by the Greek Cypriot south.

Even before Obama's visit to Israel, well-informed sources said Ankara had put out feelers to Israel about jointly developing an underwater pipeline from Israel's gas fields to southern Turkey.

The Zorlu Group, a Turkish conglomerate, was reported to be discussing this with Israeli officials and the partners operating Leviathan, Israel's biggest with reserves estimated at up to 20 tcf of gas.

These included Noble Energy Inc. of Houston, and Australia's Woodside Petroleum, the first -- and only -- foreign outfit to buy a stake in the Israeli gas boom.

The pipeline under the eastern Mediterranean would have a capacity of 282 billion-353 billion cubic feet of gas a year.

"The region's pervasive political instability will hamper Israel's ability to navigate the major infrastructural and political obstacles that prevent it from exporting natural gas," Stratfor cautioned.

"There's a rather substantial gap between the strategic intent of the player and the actual likelihood of their plans coming to fruition.

"This is a common trait of energy politics, since loose estimates of reserves can quickly evolve into grand strategies before the first feasibility test is even conducted," it observed.

"The eastern Mediterranean will continue to attract a lot of attention in the coming years, but actions driven by geopolitical desire don't always yield tangible commercial results."

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