In light of Russia’s invasion of Ukraine and the European Union’s renewed efforts to reduce its dependence on Russia, the Eastern Mediterranean could play an enhanced role in securing Europe’s power as several resources in the region, including Cyprus and Israel, could be unlocked.
“It simply came to our notice then. They look very important. And, of course, at the moment all the western countries are looking around for alternative sources and all of them are running after the same source so the cost will go up. ” Justin Urquhart Stewart, Co-founder of Regional in London, told New Europe by phone on March 16. “But it is interesting to see how quickly the attitude towards different types of power generation has changed. So, move away from A: Russia is not a supplier for oil or gas and B: actually carry out your own research and see what you can get, ”he added.
But because of the short-lived deadline set by Europe for independence from Russian gas by 2027, only projects that can ramp up quickly can benefit, Charles Eleanor, A senior fellow at the Atlantic Council’s Global Energy Center, told New Europe March 17. “For example, the already developed gas fields in Israel, the Leviathan and Copper Cyprus gas fields, Aphrodite and Glafcos, will take years to develop, then it may be too late. Unless, of course, Europe changes its policy and encourages the use of natural gas in the long run. However, at the moment it seems unlikely. Europe has reaffirmed its determination to accelerate the transfer of power. And in the meantime, it aims to reduce gas consumption by 30% by 2030 and to zero by 2050. The message is not to encourage investment in new long-term fossil fuel projects, “said Eleanor.
In the short term, Egypt’s existing facilities are the best option, he said. Egypt is already exporting liquefied natural gas (LNG) to Europe and plans to increase exports this year. However, the volume is relatively small – 2 billion cubic meters last year and probably a little more this year, Eleanus said, in support of which Israel has already increased its export capacity to Egypt by about 11 billion cubic meters offshore. East Mediterranean Gas (EMG) releases more Egyptian gas for LNG exports through the pipeline and Jordan.
According to Illinois, one option is to add more liquefaction trains to expand its two LNG plants at Iduku and Damietta, but this will take at least 3 years. “Given that Asian LNG markets are still growing, this is a possibility. If this happens, it will provide an opportunity for the development of gas fields in Cyprus and the second phase of Leviathan.
The Eastmed Gas Pipeline, or a pipeline from Israel to Europe via Turkey, which recently made headlines, is both difficult because it will take 5 years to build and 20 years of operation and export to justify the costly investment, “he added. Europe’s stated policy and renewable commitment make it difficult. “Investors need assurance and lack it,” he said.
Kurt Volker, A former U.S. ambassador to NATO and senior international adviser to the BGR group, told New Europe by phone on March 18 that Russia’s aggression in Ukraine had prompted Europe to drastically reduce its dependence on Russian power supplies. “I think it’s a game changer. The Germans have not officially closed the Nord Stream 2. At least not yet. But I think there is now a movement to dramatically reduce supplies from Russia to Europe. The British said they were going to cut off Russian oil and gas imports by the end of the year. The EU has not given a date, but I think there is pressure to reduce it at least significantly, “said Voker.
Everyone will need an alternative power supply, Johannes Benigni, Chairman of the analysis firm JBC Group, told New Europe by phone on March 17. “I will definitely consider natural gas as the energy of the future. Why? Its relations with Europe are also low. The subject is a pure mathematical function. Two-thirds of Asia’s energy demand comes from coal. You want to decarbonize the world and you manage to reduce that amount of coal and convert it against gas, you reduce CO2 emissions by half, “Benigni said.
“It simply came to our notice then. We need energy content and this is easiest if we do it with low carbon fossil fuels. So I would say gas has a future. The problem is the pipeline. The pipeline needs trust. The future of European supply means we will have a pipeline with Russia, but everyone is now going to build LNG re-gas stations. Why? Because no one wants to say, ‘Well, we depend on Russia.’ So, what happens is they build re-gas stations, nobody uses it, everyone is still going to use the pipeline, “Benigni argued.
“But when it comes to the Eastern Med Market, we know that there is no political stability and so you have the same or similar situation as in the Middle East. The money is in the Arabian Persian Gulf, “he said. The chairman of the analysis firm JBC Group explained that the cheapest possibility of gas supply in the Persian Gulf would be a pipeline around the Gulf. However, he noted that all countries prefer to create LNG facilities because they do not want to be dependent on each other. “So, I believe the more flexibility you can offer, the better. If I had gas, I would build an LNG facility because it is working because at the end of the day the demand for gas is going to be so strong for the next 30 years because the main purpose will be to decarbonize the world and gas is the only solution, “Benigni argued.
Turning to renewable energy in the Eastern Mediterranean, Eleanor said that this is the future of Eastern Med energy. “Maximize the use of renewables supported by storage and electrical interconnection, and use regional gas resources during power conversion as a back-up for renewable breaks. The potential is huge, and given Europe’s leadership, East Med should follow suit, “said Eleanor, adding that investment opportunities will be forthcoming as a willing partner with the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD).