Keep up with the news by installing RT’s extension for . Never miss a story with this clean and simple app that delivers the latest headlines to you.

 

New Mediterranean oil and gas bonanza

Published time: February 26, 2012 13:52
Edited time: February 26, 2012 17:52
Leviathan oil field (image from cyprus-now.com)

Leviathan oil field (image from cyprus-now.com)

The Middle East could soon see new battles over rights to oil and gas beneath the eastern Mediterranean in the Levant Basin and Aegean Sea. The discovery of huge reserves off Israel's coast is changing the geopolitical balance of power in the region.

­An Israeli leviathan

­Energy self-sufficiency had eluded the state of Israel since its founding in 1948. Abundant oil and gas exploration was repeatedly undertaken with meager results. Unlike its energy-rich Arab neighbors, Israel seemed out of luck. Then, in 2009, Israel’s exploration partner Noble Energy discovered the Tamar field in the Levantine Basin, some 50 miles west of Israel’s port of Haifa and with an estimated 8.3 tcf (trillion cubic feet) of highest-quality natural gas. Tamar was the world’s largest gas discovery in 2009.

At the time, total Israeli gas reserves were estimated at only 1.5 tcf. Government estimates were that Israel's sole operating field, Yam Tethys, which supplies about 70 per cent of the country's natural gas, would be depleted within three years.

With Tamar, prospects began to look considerably better. Then, just a year after Tamar, the same consortium led by Noble Energy struck the largest gas find in its decades-long history at Leviathan in the same Levantine geological basin. The gas field was discovered in October 2010 and Israel declared it its Exclusive Economic Zone (EEZ).

The find is some 84 miles west of the port of Haifa and three miles deep. They named it Leviathan after the Biblical sea monster. Three Israeli energy companies, in cooperation with the Houston Texas Noble Energy, announced initial estimates that the field contained 16 trillion cubic feet of gas—making it the world's biggest deep-water gas find in a decade. To put the number in perspective, that one gas field, Leviathan, would hold enough reserves to supply Israel's gas needs for 100 years. Israel went from a gas famine to feast in a matter of months.

With the Tamar and now Leviathan discoveries, Israel was beginning to discuss how to become a major natural gas export nation, as well as whether to significantly tax gas and oil revenues and place them into an Israeli Sovereign Wealth Fund that would make long-term investments in the Israeli economy as China and many Arab OPEC nations do.

Perhaps sensing that major oil and gas discoveries were being confirmed with the potential to change the geopolitics of the entire region, the US Geological Survey (USGS) launched its first-ever estimate of the total reserves of oil and gas in the broad region encompassing the Eastern Mediterranean including the Aegean Basin offshore Greece, Turkey and Cyprus, the Levant Basin offshore Lebanon, Israel and Syria, and the Nile Basin offshore Egypt. Their conclusion was impressive to put it mildly.

The USGS calculated the total for the eastern Mediterranean as a whole currently at 345 tcf of gas and 3.4 billion barrels of oil. Suddenly the entire region is facing completely new geopolitical challenges and conflict potential.

To put the numbers in perspective, the USGS estimates that Russia’s West Siberian Basin, the world’s largest known gas basin, holds 643 tcf of gas. The Middle East and North Africa regions have several natural gas-rich areas, including the Rub Al Khali Basin (426 trillion cubic feet) in southwestern Saudi Arabia and Northern Yemen; the Greater Ghawar Uplift in eastern Saudi Arabia (227 tcf) and the Zagros Fold Belt (212 tcf) along the Persian Gulf and into Iraq and Iran.

Just months earlier, securing foreign gas was a national security priority of Israel as existing domestic gas supplies dwindled dangerously low. Further adding to the energy crisis were the so-called Arab Spring protests sweeping across Egypt into Libya in early 2011. The revolts toppled Mubarak, under whose regime Egypt had supplied some 40 per cent of Israeli natural gas.

With Mubarak toppled and the ban lifted on Egypt’s Islamic parties, especially the Muslim Brotherhood and the radical Salafist Al-Nour Party, the gas pipeline delivering Egypt’s gas to Israel was the target of repeated sabotage and disruptions. The most recent was in February of this year in northern Sinai. Israel was becoming more than nervous about its future energy security.

The discovery of Leviathan by Israel in the waters offshore immediately triggered a new geopolitical conflict as Lebanon claimed that part of the gas field lay in Lebanese territorial waters in the country’s Exclusive Economic Zone (EEZ). Lebanon delivered maps to the UN to back its claim, to which Israeli Foreign Minister Lieberman retorted, “We won’t give an inch.”

The fly in the Mediterranean energy soup is the fact that Israel, like the USA, has never ratified the 1982 UN Convention on Law of the Sea dividing world subsea mineral rights. The Israeli gas wells at Leviathan are clearly within undisputed Israeli territory as Lebanon affirms. But Lebanon believes the field extends over into their subsea waters as well. The Lebanese Hezbollah claims that the Tamar gas field, which is due to begin gas deliveries by the end of this year, belongs to Lebanon.

Washington has lost no time adding political gasoline to the natural gas dispute between Lebanon and Israel. In July of 2011, Israel was preparing to submit its own proposal to the UN as to where the offshore demarcation line between Lebanon and Israel should run. At the same time, Frederick Hof, the US diplomat responsible for special affairs regarding Syria and Lebanon, told Lebanon that the Obama administration endorsed the Lebanese document. This addied to the growing tensions reported since the outbreak of the Arab Spring between Israeli Prime Minister Benjamin Netanyahu and Obama.

Netanyahu has reportedly recently urged America’s eighth-wealthiest person, his close friend Las Vegas casino billionaire Sheldon Adelson to pour millions directly into the campaigns of Republicans, including Newt Gingrich and Mitt Romney. This would represent an unprecedented direct Israeli intervention into US presidential candidates’ campaigns, in order to try to avert a second Obama term. 

New issues of control of the vast energy reserves being discovered off Israeli and Lebanese, Cypriot, Turkish and Greek shores will clearly play a growing role in one of the most entangled political regions on Earth.

­F. William Engdahl, author of A Century of War: Anglo-American Oil Politics

­Disclaimer: The views and opinions expressed in the story are solely those of the author and do not necessarily represent those of RT.

Follow us

Follow us