Greece and Cyprus are finding out the hard way that U.S. interest does not necessarily translate into project feasibility. Both countries’ Israel ambassadors advocated vigorously for East energy cooperation in November.
However, while such an initiative would certainly promote Washington’s interests by enhancing regional cooperation and potentially connecting into European gas markets, the vision for it obscures the reality on the ground.
“East Mediterranean natural gas cooperation would serve the interests of the U.S. and the EU by creating a new positive environment in the region and reducing prospects of conflict, while at the same time providing new sources of energy security,” Cypriot Ambassador Dimitris Hatziargyrou said during a conference at Jerusalem’s Truman Institute. “This is how we establish the conditions of regional peace.”
The ideal manifestation of this cooperation, according to Greek Ambassador Spiros Lampridis, would be a pipeline that connects Israel’s offshore Leviathan field to Cyprus, continues to Crete, and ends on the Greek mainland, with the possibility of extending to Italy.
“The East Med Pipeline … has distinct advantages for Europe and the Middle East,” he told the conference. “This pipeline would enable several countries in the region to determine further their own foreign policy and security orientation, creating a win-win situation of mutual development and coexistence.”
A potential pipeline has also attracted the interest of the European Union. The European Commission, which is responsible for proposing legislation and implementing decisions, has already approved the East Med Pipeline as a Project of Common Interest (PCI), making it eligible for EU funding. Creating this energy corridor qualifies as a candidate because it would diversify member states’ energy supply by reducing dependence on Russian natural gas.
Unfortunately, technical, financial and even geopolitical factors make the construction of the East Med Pipeline essentially dead on arrival.
Topographically, sea depths in the eastern Mediterranean basin and the Aegean would limit the size of a pipeline. Its length also increases difficulties—the total distance from Leviathan to the Italian coast is about 1,880 kilometers, and the project would cost an estimated $20 billion.
European natural gas prices are low on the international scale, and consumption there is stagnating, making the investment questionable. For Israel, committing to the East Med Pipeline would further sour its already strained diplomatic relations with Ankara. It could also be the nail in the coffin of any potential deal to export Israeli natural gas to Turkey.
These obstacles have encouraged the companies involved to look elsewhere, namely to Israel’s immediate neighbors—Egypt, Jordan and the Palestinian Authority—but also to markets in the Far East, according to Michael Lotem, the Israeli Ministry of Foreign Affairs Special Envoy for Energy Issues.
“Until a year ago, many spoke of a pipeline from Leviathan to Cyprus, Crete and then to Greece,” he said at the Truman Institute. “That’s a very attractive option, but there are technical problems … which are making the project very expensive, and so that brought the companies to look into other options as well.”
Noble Energy, the U.S. company leading Leviathan’s development, indicated its reluctance to export the gas through a potential East Med Pipeline after CEO Charles Davidson said the consortium plans to sell the gas regionally, as the Egyptian and Jordanian gas shortages have “fundamentally changed export plans.”
There is no doubt the East Med Pipeline project would further institutionalize regional cooperation and advance U.S. interests in the area.
But even though Cyprus and Greece strongly believe in this new energy corridor, the challenges involved in constructing it have ultimately dashed this pipe dream.