Cyprus and Egypt Freeze out Turkey in Possible Gas Deal

Egypt and Cyprus are deepening energy co-operation, as an apparent anti-Turkey bloc emerges in the Eastern Mediterranean – potentially undermining US hopes that the area’s gas finds could reduce regional tensions.

At a tripartite Egyptian-Cypriot-Greek meeting in Nicosia on Tuesday, Sherif Ismail, Egypt’s petroleum minister, said Cairo would speed up talks to pipe Cypriot gas for domestic needs and possible re-export.

The use of the gas is a point of heated dispute between Cyprus and Ankara. “They should know that if they try to search for oil, natural gas, south of Cyprus we will not allow this,” Ahmet Davutoglu, Turkish prime minister, said on Tuesday. “The Mediterranean is also our sea – if necessary, we too will drill.”

But the ministers’ meeting in Nicosia was only the latest such gathering at a time when Turkey’s relations with many of its neighbours have deteriorated.

Abdel Fattah al-Sisi, Egypt’s president, held a summit with Nicos Anastasiades, the Cypriot president, and Antonis Samaras, Greece’s prime minister, in Cairo earlier this month. Cyprus and Egypt have both also strengthened ties with Israel, whose own relations with Turkey have become increasingly frayed as Ankara has increasingly championed the causes of the Muslim Brotherhood and Hamas.

“This is an indication of how weakened Turkey’s ability is to form alliances in the region,” said Sinan Ulgen at Carnegie Europe, who added that Ankara’s ties with Islamist movements are seen as a threat to the status quo in several countries. “There is certainly an element of an anti-Turkey coalition forming here, although I see it as fragile and ineffective.”

Relations between Cairo and Ankara have deteriorated sharply since the Egyptian military ousted the elected Islamist government last year. Cairo said recently that it would not renew a 2012 three-year transit trade agreement with Turkey that provided an alternative to routes through war-torn Syria.

Meanwhile, Israel has drawn closer to Egypt, while its own relations with Turkey have grown increasingly bitter despite a bid to restore full diplomatic ties last year.

Cyprus denies seeking to establish an anti-Turkey coalition, but tensions between it and Ankara have risen noticeably in recent weeks because of the gas dispute.

Turkey last month dispatched an exploration vessel of its own to the waters off southern Cyprus – with a military escort – causing Cyprus to break off talks on the unification of the island.

“It’s an incursion, totally illegal . . . done through the use of force against a republic that’s not in any position to respond,” Ioannis Kasoulides, Cyprus’s foreign minister, said at the time.

Ankara, which has no diplomatic relations with Nicosia, argues that the exploitation of gas should be agreed with the Turkish Cypriot minority on the divided island and that Turkey itself is the most logical market for Cypriot gas.

But Egypt is experiencing gas shortages and has emerged as an alternative market. Cairo is also looking at transporting natural gas from Israel through a new underwater pipeline.

Mr Kasoulides told the Financial Times last month that Cyprus was in negotiations to “combine forces and pipelines” to go directly to liquefied natural gas stations in Egypt.

The Obama administration still holds out hope that the Eastern Mediterranean’s gas finds could bring the region together – and in particular act as a spur to the negotiations to reunify Cyprus.

“It holds the promise of enhancing stability and prosperity by bringing together Israel, Turkey, Egypt, Greece, Cyprus and hopefully one day Lebanon,” Joe Biden, US vice-president, said at the weekend, as he called for a de-escalation of tensions. “It also has the potential to bring new supplies into Europe, to increase its energy security.”

Source: The Financial Times