Filenews 13 October 2022
By Daniel Markind
And while the energy market is already in turmoil – mainly due to the developments in Ukraine and Iran, but also due to OPEC+'s decision to reduce oil production – another region is being shaken by developments in this sector, since the prospects opened up by natural gas in the Eastern Mediterranean give rise to hopes and conflicts.
The first flashpoint is the area west of the maritime border between Israel and Lebanon. Two natural gas fields have been discovered there: Karis and Cana. Both countries would like to exploit these deposits, as long as they could make it clear to whom they belong. Karis appears to be within Israeli territorial waters, while Cana extends to a disputed sea area.
Technically, the two countries have been at war since the founding of the State of Israel in 1948, since they have not agreed on their borders. The issue has become more complicated in the last 40 years, since Lebanon has become the base of the Shiite terrorist organization Hezbollah, which is supported by the Iranian regime, and which makes no secret of its hatred and desire to literally destroy Israel.
However, for months, US special adviser on energy Amos Hochstein acted as a mediator for an agreement between the two states, which was reached this week, after Tel Aviv and Beirut accepted the final draft proposed by the US.
Lebanon's Energy Minister Walid Fayyad wasted no time and announced that the French company Total would immediately begin exploratory work on the Cana deposit. Despite this development – and unfortunately for Lebanon – the country will be slow to see revenues in its public coffers from the exploitation of energy resources, which will give breathing space to an economy that has suffered from the largest collapses in the world in decades.
Energy is one of the most corrupt business sectors in Lebanon, where corruption is dominating anyway. Moreover, Beirut will have to deal with possible reactions from Hezbollah, which very often sets as its main objective the annihilation of Israel and not the improvement of life in Lebanon.
Throughout the negotiation process, Hezbollah threatened the Lebanese government against any agreement with Israel, and even sent drones to the Karis deposit in the summer in an attempt to prevent Israel from starting production work in the region. However, with Lebanon's national economy in a state of near-complete collapse, mainly due to past actions by Hezbollah, which functioned as a state in the state in the state, and Iran facing mass protest demonstrations at home, the Shiite group failed to prevent Lebanese President Michel Aoun from advancing the deal with Israel.
For its part, Tel Aviv has its own internal affairs. Former prime minister and member of the conservative Likud party, Benjamin Netanyahu, asked the government not to reach an agreement with Lebanon, as this could also reap money for Hezbollah. But the current Prime Minister, Yair Lapid, proceeded with the agreement, with the support of the Israeli army.
Before the deal was announced, the London-based company Energen began testing the laying of pipelines between the Karis deposit and the Israeli coast.
Lapid has said that if Hezbollah attempts to stand in the way of energy production from the exploitation of the deposits, its reaction will be tantamount to an act of war against Israel. Since Hezbollah is part of the Lebanese Government, but at the same time retains its autonomy, it is not yet clear how it will move. You waited...
Meanwhile, the foreign ministers of Greece and Egypt met on Sunday and condemned the agreement that Turkey signed last week with the so-called interim government of Libya. The Memorandum of Understanding grants Ankara jurisdiction to exploit the gas fields in the undersea region of eastern Libya.
The parties are led by Turkey's stormy President Tayyip Erdogan and Abdul Hamid Dbeiba who leads one of the two factions that claim to be the legitimate rulers of Libya.
The country has the largest oil reserves in Africa, and the Libyan nation has historical ties with Turkey starting with the Ottoman Empire. In 2019, Libya and Turkey signed a memorandum that ignores neighbouring countries, effectively claiming a large part of the Eastern Mediterranean as their own economic zones. The Turkish-Libyan Memorandum was widely condemned and had practically little effect.
The new agreement, however, focuses on something concrete and has drawn the ire of the historical rivals of the two countries: Greece and Egypt. Egypt supports Dbeiba's opponent for Libyan power, Haftar, while Greece is concerned that this Memorandum may violate its sovereign rights.
All this leads to the conclusion that, while the eyes of the international media are on Ukraine, China and Iran, developments in the field of energy could ignite the wick in other regions as well, having an impact worldwide. It would be wise to keep an eye out.
Source: Forbes
