Monday, September 19, 2011

Turkey's Threat to Israel's New Gas Riches

Simon Henderson
September 13, 2011

Ankara's warning that Turkey will stop Israel from unilaterally exploiting gas resources in the eastern Mediterranean poses a direct challenge to U.S.

On September 8, Turkish prime minister Recep Tayyip Erdogan told Aljazeera that his government had taken steps to prevent Israel from unilaterally exploiting
natural resources in the Mediterranean Sea. "Israel has begun to declare that it has the right to act in exclusive economic areas in the Mediterranean,"
he stated, apparently citing Israeli plans to tap newly discovered offshore gas reserves. Israel "will not be the owner of this right," he warned.

In other remarks, Erdogan declared that the Turkish navy would protect future aid ships bound for Gaza in order to prevent a repetition of the 2010 flotilla
incident, in which Israeli commandos killed nine activists attempting to break the blockade. These comments came just days after the release of a UN report
condemning the deaths but justifying Israel's blockade -- a judgment that prompted Ankara to drastically reduce diplomatic relations between the two countries
and freeze their substantial military cooperation and trade.

By September 9, both governments seemed to be stepping back from a confrontation over any future humanitarian convoy. One Turkish official reportedly said
that Erdogan had been "misquoted" and taken "out of context," while Israeli prime minister Binyamin Netanyahu's office countered a media report attributed
to the office of Foreign Minister Avigdor Liberman about potentially supporting the terrorist Kurdistan Workers Party (PKK) in its conflict with Turkey.
Even so, the potentially more problematic issue of offshore natural gas rights looms large.

The UN Convention on the Law of the Sea gives each country the right to exploit resources in an "exclusive economic zone" up to 200 nautical miles from
its coastline, but maritime border agreements with neighboring states (including offshore neighbors located less than 400 nautical miles away) still need
to be negotiated. In the eastern Mediterranean, this issue came to the forefront after Israel discovered substantial offshore gas reserves estimated to
exceed current consumption levels several times over. Such large-scale findings offer the probability of substantial energy independence and likely surpluses
for export.

Neighboring Egypt is already a key player in the international natural gas market, while Lebanon and Cyprus are considered geologically likely to have significant
offshore reserves of their own. The first exploratory drilling off Cyprus is set to begin next month -- a development that could result in even more threatening
rhetoric from Ankara.

Role of the Cyprus Dispute

Although Erdogan's September 8 comments conflated the gas and Gaza blockade issues, the real key to understanding Turkey's current squabbles with Israel
is the unresolved dispute over Cyprus. In the 1960s and 1970s, tensions between the island's Greek-speaking and Turkish-speaking communities -- backed,
respectively, by Athens and Ankara -- often seemed a greater danger to regional peace than differences between Israelis and Palestinians. Since 1974, when
Turkey sent troops to the island to support the Turkish Cypriot community and block any union between the majority Greek Cypriots and Greece, the island
has been divided, with UN forces interposed between the two sides.

Frequent attempts at reconciliation have failed. With Ankara's backing, Turkish Cypriots have established the notionally independent Turkish Republic of
Northern Cyprus, which is bolstered by the presence of more than 30,000 Turkish soldiers. Yet no country other than Turkey has recognized the TRNC -- a
fact that continues to infuriate Ankara. Meanwhile, the Greek-majority Republic of Cyprus has become a member of the European Union and is considered to
represent the entire island.

The recent discoveries of natural gas under the eastern Mediterranean seabed have seemingly prompted Ankara to renew its diplomatic campaign on behalf of
Turkish Cypriots. Erdogan reportedly stated last week: "Turkey, as a guarantor of the Turkish Republic of Northern Cyprus, has taken steps in the area
[of the offshore resources], and it will decisively pursue its right to monitor international waters in the east Mediterranean." Such a policy could put
Turkey at odds with all the littoral governments of the area, from the Republic of Cyprus to Israel, Lebanon, Egypt, and Syria:

list of 5 items
• Cyprus. Ankara is annoyed that the Republic of Cyprus signed a maritime border agreement with Lebanon and another with Israel. In 2008, the Turkish navy
reportedly came dangerously close to ships carrying out seismic surveys in Cypriot waters, alarming Washington. On September 8, the Greek Cypriot government
issued a statement protesting Ankara's claim that the island's plans to explore and exploit offshore reserves are not in line with international law and
do not facilitate resolution of the Cyprus problem. "The Cyprus problem cannot be solved with threats," the spokesman noted. Ankara's anger with Cyprus
will likely grow after July 2012, when the island holds the EU presidency for six months. Although Turkey has already cooled its enthusiasm for joining
the union, it may well become irritated by the prestige and enhanced diplomatic influence that EU leadership will confer upon Cyprus. Indeed, Ankara has
said it will freeze ties with the union during this period.

• Israel. The discovery of the huge Leviathan gas field in 2010, close to the Israel-Cyprus maritime border, has generated optimism that similar abundance
might be found in nearby Block 12, which lies in Cypriot waters. One way of exploiting such reserves would be to establish an export-oriented liquefied
natural gas facility on Cyprus, to be operated jointly with Israel. Yet Turkey has already condemned the idea.
• Lebanon. The Lebanese parliament has yet to ratify the signed maritime border agreement with Cyprus, in part because Beirut disagrees with the Cyprus-Israel
accord and the Israel-Lebanon maritime border it implies. Iran and its Hizballah surrogate have accused Israel of seizing Lebanese offshore gas fields,
even though none of the Israeli discoveries made thus far are anywhere near the disputed line. Ankara, already sympathetic to Hizballah, may be tempted
to take sides in this dispute despite concern about Lebanon exploiting its own offshore resources.
• Egypt. Cairo already has a maritime border accord with Cyprus, signed in 2003 and ratified in 2004, as well as a framework agreement for resolving ownership
of resources that cross the median line. Ankara's desire for good relations with Egypt probably trumps any concern it might have about this accord, and
Erdogan gave no sign of raising the issue during his trip to Cairo yesterday.
• Syria. As an oil and gas producer, Syria is expected to look offshore for reserves at some point in the future. In addition to a maritime agreement with
Cyprus, Damascus will also need to draw an offshore line with Turkey. This will be problematic because of the Turkish province of Hatay, a finger of coastal
territory that Damascus has regarded as Syrian land in the past. Although President Bashar al-Asad declared the issue resolved during a 2004 visit to Turkey,
no details were given, and Syrian television continues to give the weather forecast for the area as if it is a part of Syria.
list end

U.S. Policy

Washington has a strong interest in eastern Mediterranean countries finding and exploiting offshore reserves. For example, Houston-based Noble Energy is
leading the drilling in both Israeli and Cypriot waters. U.S. policy would also be well served by peaceful resolution of the Cyprus dispute, which is fast
becoming yet another hindrance to Turkey's EU aspirations.

Accordingly, U.S. officials must emphasize to Ankara that its recent rhetoric is incompatible with being recognized as an important diplomatic partner of
the United States and Europe. Erdogan's latest comments came shortly after Turkey accepted Washington's request to host a radar station intended to warn
of potential Iranian missile launches against Europe and, in the future, the United States. Ankara cannot be permitted to enjoy the benefits of a strong
relationship with Washington while undermining U.S. objectives in the eastern Mediterranean.

Simon Henderson is the Baker fellow and director of the
Gulf and Energy Policy Program
at The Washington Institute.

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