أرشيف مقالات نيكوس رولانديس عن الغاز الطبيعي (شرق المتوسط)
المقال الأول:
LET THERE BE GAS… NINETEEN YEARS HAVE GONE BY
Prudence and wisdom is necessary in the handling of natural gas
بتاريخ: 29 مارس 2017
At 7 in the morning of Tuesday 31st March 1998, exactly 19 years back, I was in the office of President Glafcos Clerides. I had been appointed Minister of Commerce, Industry and Tourism a month before. The portfolio of Energy was in my Ministry. I had already been officially engaged with oil and gas in the Exclusive Economic Zone (EEZ) of Cyprus since 1980, when I was Minister of Foreign Affairs. At that time, I had received in my office a representative of U.S. oil majors Amoco and Standard Oil of Indiana, which were interested to invest in the sea south of Cyprus for “possible large hydrocarbon reserves” as they told me. At that time the United Nations had advised us not to proceed.
My meeting with President Clerides was preceded by a lot of thinking and meditation. Although I had studied in depth the whole subject, I knew that I might ridicule myself in case of a fiasco. After all, none of my predecessors in office had ever pursued such a matter.
At the beginning, when Clerides heard about the subject, he turned to me with a queer look on his face. I described in detail what I knew and what I had studied since 1980. He pondered over the subject for a while, he looked at me once or twice. Finally I heard what I wanted to hear: “You may proceed, Nicos”, he told me. “Submit the matter to the Council of Ministers for approval”.
So, “let there be light”…. For the first time in its history the Republic of Cyprus would be officially engaged in the search for oil and gas in the sea around it.
I started working. My fear about efforts to ridicule me were unfortunately proved correct. Many media were humiliating me for months. The British High Commissioner Edward Clay stated ironically on the 26th January 2001 that “there is as much oil in Cyprus as there is peanut butter below Manchester”. The culmination of all that, was an effort by certain circles to have me kicked out of the Ministry, because I was supposedly ridiculing the President. But Glafcos Clerides stuck to his unwavering position. He asked me to go on. So I went on. On the 17th February 2003 I signed in Cairo the first EEZ Agreement in the Mediterranean. I also delimited the EEZ of Cyprus. I continued in order to reach the point of: “There is light”. In February 2003 I passed the baton to my successor in office.
At that time I was also quite concerned with the dangers which might lie in ambush when there is more than one suitor of a great wealth. In our case this wealth might be in the dozens of billions of US dollars. It was well known that Turkey had laid a claim to the Cyprus hydrocarbons. I had written in an article of mine at that time that “hydrocarbons may prove to be a blessing or a curse for a country”.
It was obvious through my contacts with foreign Governments that they would not recognise any rights to Turkey, but on the other hand they firmly believed that the Turkish Cypriots were entitled to benefit from the bonanza (there were many statements to that effect). That was my personal view as well. So, in 2006 I put forward the following proposal, which might be adopted, irrespective of any progress in the intercommunal talks.
- To have a Disclaimer signed by the two communities which would clarify that any hydrocarbons Agreement would not constitute a precedent for the talks on Cyprus.
- Out of the net hydrocarbons earnings, a percentage to be agreed (I had in mind 20-25%) to be deposited in an escrow account in favour of the Turkish Cypriot community.
- The amount in the escrow account to be released either upon solution of the Cyprus problem or after a number of years to be agreed (possibly 10 years) whichever would happen earlier.
We would thus secure a reasonable share for each community (Unless we believed that Turkey would ever let us acquire the whole wealth for ourselves).
Our own side did not adopt the above proposal. It relied on our sovereign rights. This position may be theoretically correct but in reality, Turkey violates our sovereignty for 43 years and nobody cares to help. Who is going to help in the case of our EEZ? And also what about the rights of the Turkish Cypriots?
Mehmet Ali Talat, when he was “President”, invited me twice for lunch in 2006 and showed an interest to have the matter discussed. He was also prepared to take up the matter with Ankara. But our side did not make any move.
Oil and gas is not simply a matter of sovereignty. There are many factors, which create disputes and conflicts in many parts of the world. The example of Greece, which does not proceed in the Aegean, and does not even delimit its EEZ in the Aegean in order to avoid a clash with Turkey, which disputes Greece’s sovereign rights, is there for 40 years. Are we stronger and cleverer than Greece? The case of the South China Sea with the huge oil and gas reserves and the many suitors which does not proceed either, despite the involvement of Exxon Mobil, Gazprom and Rosneft and despite judgments of international tribunals, is another example, amongst 15-20 other cases where reserves remain untapped. Shall we manage to be the exception?
The fact that major corporations are involved in Cyprus is positive, but it does not avert the danger of conflict. Such corporations are conservative and they distance themselves from explosive situations if and when they occur. Furthermore, they have interests in Turkey, a market by 50 times larger than Cyprus. And anyway, their rights in the Cyprus EEZ will not be lost, whoever may eventually the master of the game in the area.
On many occasions in the past, I was proven correct in my assessments, when it was unfortunately too late: On Cyprus, on natural gas, on the S300 missiles and on other issues as well.
On the question of Cyprus, we lost good opportunities in the first years after the invasion. My advice fell on deaf ears, my resignation from the post of Foreign Minister and my efforts for a solution before it became too late, did not come to fruition. Nicos Anastasiades tries honestly and incessantly today in all possible ways. However, the road to a solution appears to be difficult of passage. Almost inaccessible. The conditions on the ground are not the same anymore.
Let us not be under illusions. If in the case of hydrocarbons, we do not strike a solution along the lines I suggested eleven years ago (if it is not already too late) and the Cyprus problem is not resolved, the scenarios which may follow will not be pleasant. I hope that they will not be nightmarish. I hope that Turkey will not start pumping the gas and the wealth of Cyprus (who is going to stop her?) or lead us into adventures.
The sultans of Ankara attack and threaten mighty countries like Germany, Holland, Austria and others. They are manoeuvring between Russia and the US in a complex game or huge interests. They distance themselves and insult Europe – and Europe puts aside her own rules and invites them as observers in her organs. Will they back down and retract in the case of Cyprus, Total and Exxon Mobil when the wealth at stake is colossal?
Since 1955, in the international arena, we have been losers in our endeavours. In the process, we have lost more than one third of our motherland as well.
The President must move forward with a lot of care. He must watch his steps. He took over an extremely difficult situation. A great lot of prudence and wisdom is needed, both on the question of Cyprus and on natural gas.
المقال الثاني
NATURAL GAS: THE JOURNEY
A chronicle of struggles, challenges, insults and vindication
بتاريخ: 28 مايو 2014
There is a journey for all of us, which starts and reaches a finishing point, a journey that marks and gives colour to our lives.
In Shakespeare’s “Othello”, Othello tells Gratiano:
“Here is my journey’s end, here is my butt,
and very sea-mark of my utmost sail:”
There has been a starting and a finishing point of my own journey in the history of the oil and gas of Cyprus. I describe below in brief the chronicle of the hydrocarbons (oil and gas) of Cyprus, from day one, when I first started the process on the 31st March 1998 until the day I passed the baton down the line on the 28th February 2003. When I commenced the effort almost nobody in Cyprus had even the faintest idea of what it was about. Today oil and gas constitute the “life” and the “future” of our country.
The data I put forward are absolutely authentic, based on Government documents, newspaper reports and on my own diary.
1) 4th August 1980: At the time I was Minister of Foreign Affairs. M.J. Ambrose, senior executive of US oil majors Amoco and Standard Oil of Indiana met me in my office and told me that the above corporations were interested to invest and explore for hydrocarbons in the sea south of Cyprus. Ambrose talked about “large reserves”. In the meantime our Public Relations office in Washington DC had informed us that Turkey had learned about the American oil and gas interest and had threatened to proceed with “a further military operation in Cyprus”. I took Ambrose to President Kyprianou on the following day and after the meeting the President asked me to call and seek the advice of U.N. Secretary-General Kurt Waldheim on the subject. Waldheim came back to me and discouraged us from proceeding on account of the Turkish threats. The President called a halt “for the time being”.
2) On the 20th September 1983 I resigned from the post of Foreign Minister, because I differed with the President on the Cyprus problem. I took with me a file with copies of the minutes on oil and gas. I also carried strong memories from the late 1940s, when I was a boy, and three Limassol friends of my father’s, wine barons Demetris Hadjipavlou and Kleanthis Christophorou and businessman Polyvios Kyriakides invested a fortune and drilled, near Moni, for oil and gas without success.
3) On the 1st March 1998 I was appointed Minister of Commerce, Industry and Tourism. Energy was one of my portfolios. The oil and gas file from the Ministry of Foreign Affairs I placed on my desk and I kept wondering whether I should raise the matter officially. My vision and my instinct assured me that there were hydrocarbons down there but I feared that in case of failure I might ridicule both the Government and myself. After all, since 1960, when the Republic of Cyprus was established, no Commerce Minister had raised such an issue.
4) A little before the end of March 1998, Archbishop Damaskinos of Switzerland and Greek Ambassador to Syria John Mourikis (I knew them both quite well) called and advised me that important US oil companies were interested in the oil and gas sector of Cyprus. The information encouraged me. I asked for a meeting with President Clerides which was fixed on Tuesday the 31st March 1998.
5) Initially the President looked at me in a strange manner. He asked me to brief him in detail. I spoke for approximately 15 minutes. Clerides pondered over the subject for a while. “You may proceed, Nicos” he said. “Bring the matter to the Council of Ministers for approval”. The big “Yes” for Cyprus was already there. According to what my then colleague and now President of DISY Averof Neofytou said on a TV program, the members of the Council were smiling in disbelief, but they approved that I should proceed under conditions of absolute confidentiality.
6) On the 1st July 1998 I met in my office the representatives of US oil corporations Crest and Brown & Root. They were prominent persons and companies of the American establishment. We discussed the possibility to supply Egyptian gas to Cyprus and also the question of oil and gas reserves in the sea area of Cyprus. A Memorandum of Understanding was signed with the above, with whom our cooperation continued in the following years. The supply of gas from Egypt came across many practical difficulties.
7) I reorganised the energy department of the Ministry. The management team on hydrocarbons was composed of Director-General Michael Erotokritos (and later on Sotiris Sotiriou) and also Olympia Stylianou and Solon Kassinis.
8) On the 24th September 2000 a daily newspaper disclosed the subject of natural gas. There were continuous reports in the following months in the local press. Gradually natural gas became a household word. Many people spoke ironically about me. On the 26th January 2001 the British High Commissioner Edward Clay stated that “there is as much oil in Cyprus as there is peanut butter below Manchester”. In the wake of this comment the press accused me that I had converted Cyprus into the laughing stock of the world. Others argued that natural gas was simply a soap bubble invented by me in order to help DISY in the parliamentary elections of May 2001.
9) I set out herebelow some of the publications (I have all press cuttings in my archives):
· “What a beautiful tale over-imaginative Rolandis has discovered to gain publicity!”
· “God save this country from the stupidity, the day dreams, the imagination and the visions of those who govern us. Where did Clerides find a minister like Rolandis?”
· Mr Rolandis, please remember me when you sit as an equal together with the emirs and the sheikhs of OPEK.
· “Since the day the rocket of petroleum was shot up into the air, Rolandis has not ceased talking “.
· “If Nick Rola stays for a few more years, in 2003 we shall not have a presidential election, we shall elect the ruler of the planet”.
· “Are we really niggers? Can we not tell what is true and what is a lie? This is why people like Rolandis rule the country”.
· “Rolandis keeps harping on the tune of oil. He sacrifices the national interest to gain publicity”
· “Oil and gas: Rolandis is a Don Quixote”
10) The humiliating publications and sketches continued in the first half of 2001. In the summer of 2001 I was informed by a close associate that certain circles at the Presidential Palace were trying to convince the President to fire me on account of the damage caused by my daydreams about oil and gas. I called and fixed an appointment with the President on Wednesday 3 October 2001. I told the President what I had heard. Clerides looked at me and he said:
“Nicos, put these things into one of your ears and take them out of the other ear. Go on with your work”.
11) I thanked him and I continued my work which overall included:
a) Discussion of the Exclusive Economic Zone (EEZ) with the Ambassadors of Israel Shemi Tzur and Michael Eligal.
b) Meeting in Lebanon on 20th September 2002 and preliminary delimitation of the EEZ with President Emile Lahoud, Prime Minister Rafic Hariri and Oil Minister Mohammed Baydoun.
c) Meeting at the end of April 2001 in the USA with former President George Bush, the president’s brother Neil Bush, Minister of Commerce Don Evans, Minister of Energy Spencer Abraham and senator (and future Presidential candidate) John McCain.
d) Meetings in Russia, Algeria, Syria and Greece with my counterparts.
e) Preliminary meetings at the Ministry with specialised companies for surveys in our EEZ.
12) Egypt: A very important country for us. With Egypt’s Minister of Petroleum Sameh Fahmy we agreed the delimitation of the EEZ of Cyprus and Egypt after hard negotiations. The initial stand of the Egyptians was to draw the separating line against us, 30 kilometres to the north, because of the very long coastline of Egypt compared to ours. Eventually they accepted the Median Line in order to create a precedent for the Red Sea. Our Ambassador in Egypt Jimmy Droussiotis helped a lot in this regard. The median line was a great success for us. On 17 February 2003 I signed in Cairo with Egypt’s Foreign Minister Ahmed Maher the EEZ Agreement of Egypt and Cyprus. It was the first agreement of this nature ever signed in the Mediterranean.
13) My firm position during all the above years and thereafter was that hydrocarbons should be used as a tool and a catalyst for the solution of the Cyprus problem and for peace in the wider area.
14) As for the bitterness created by the press publications of 2001, the newspaper with the largest circulation in Cyprus wrote on the 1st January 2012, 11 years later, a piece which gave me profound satisfaction. “As the memory in politics is short, we would remind, that if somebody was vindicated in regard to the hydrocarbons is Nicos Rolandis. When the man was talking about the natural wealth of Cyprus he was considered naïve and people were smiling in defiance. Even people of his own political environment. He deserves a reference to the struggle he first commenced”.
15) This was my journey, my utmost sail, my butt, as Shakespeare’s Othello described it. Hydrocarbons in the medium term will radically upgrade our lives, if we handle them professionally and with prudence.
المقال الثالث
OIL & GAS – A HISTORICAL BACKROUND AND FUTURE PROSPECTS
Speech of Nicos A. Rolandis at the Opening Ceremony of the International Conference
“Power Options for the Eastern Mediterranean Region”
بتاريخ: 19 نوفمبر 2012
In the late 1940s there was nothing at all in this area, where the Meridien Hotel stands today. It was an endless field, full of carob trees and wild flowers. It was at that time that a tall steel tower emerged and rose toward the sky, just a few hundred metres away from this hotel. Three Limassol businessmen, two wine barons, Demetris Hadjipavlou and Kleanthis Christophorou and also water expert Polyvios Kyriakides had started an oil exploration venture. They and their consultants were overconfident that there was oil down there in the depths of the earth.
We were under British rule at that time. My father was a close friend of the three of them. I was a schoolboy. So, on a number of occasions, when I visited Limassol with my father, we used to come over here and sit and talk in the small workshop, which was built next to the tower. At that young age, I became for the first time aware of what oil means. The rhythmic noise of the drilling equipment is still in my ears.
The venture failed. They drilled quite deep, approximately 200 kilometers away from the present-day offshore block 12. They had invested £300.000, a huge amount by the standards of those years, but their coffer had run dry. They had sunk their money into a futile exercise.
Thirty years later, I served for 5 ½ years as Minister of Foreign Affairs of the Republic of Cyprus. Toward the end of July 1980 I had a message from the officer in charge of the Public Relations firm we employed in Washington DC, Mr. Wittenberg that an American corporation the Standard Oil of Indiana, was interested to drill for oil, offshore, south of Cyprus. Wittenberg advised us furthermore that the Turkish Government had learned about it and that “they did not favour such an activity and that in case we drilled, Ankara would study the possibility of a further military operation in Cyprus”.
I was already conversant with the subject of oil and gas, because my people headed by Ambassador Andreas Iacovides, participated for many years in the negotiations at Montego Bay, Jamaica for the Law of the Sea Convention, which was eventually concluded in 1982. My memories of the failed efforts in the 1940s came back as well.
So, on the 4th August 1980 I received in my office the Senior Executive of the Standard Oil of Indiana and of Amoco, Mr Ambrose, who was accompanied by George Polyviou of the Chryssafinis & Polyviou law firm. Ambrose confirmed the interest and readiness of his company to start the exploration process without delay. He estimated “that we might probably be able to pump 100,000-200,000 barrels of oil a day” and he went into many other details. He added that they had a large operation in Egypt as well. Because of the importance of the subject, I arranged a meeting with President Kyprianou on the following day. After the meeting I conferred with the President and he asked me to get the opinion of U.N. Secretary-General Kurt Waldheim.
I called Waldheim, who listened carefully. He asked me to leave the matter with him for a few days. He called me back a week later. His recommendation was negative. He suggested that we should postpone any activity because of the Turkish threats. We were just 6 years away from the Turkish invasion of 1974. President Kyprianou decided that we should shelve the matter. My belief and confidence though that oil and gas should be somewhere onshore or offshore Cyprus became much stronger.
Twenty years on, in early 1998 I became Minister of Commerce, Industry and Tourism, which includes the portfolio of energy. I had with me the precious file from the foreign Ministry, with copies of the minutes of the Standard Oil of Indiana affair. I was the 13th Minister, appointed 38 years after the Republic was established. Oil and gas was in my mind. However none of my predecessors in office had raised the issue. Should I raise the matter? The file from the previous Ministry was on my desk, but I was aware that the subject could cause sarcasm and derision. The encouragement of an American company called Crest, of the Egyptian Minister of Petroleum Samer Fahmy, of the Director-General of the Ministry Michael Erotokritos and Director Olympia Stylianou and of the Energy Department of my Ministry headed by Solon Kassinis, prompted me to take the matter to President Clerides at an early morning meeting in 1998. Clerides looked at me in a strange manner at the beginning, but after I put forward all my arguments he said: “OK Nicos, you have the green light. You may proceed”. He asked me to submit the matter to the Council of Ministers, and I had their approval as well. Incidentally, Averof Neophytou, a colleague of mine at that time and now deputy President of the Democratic Rally Party, said many years later on television, that whenever Rolandis brought the oil and gas issue to the Council of Ministers the members of the Council were smiling and seemed to be unconvinced.
Anyway, my dream was there for implementation. I started the process. We negotiated with the Egyptians with whom we reached an Agreement in regard to the Exclusive Economic Zones (EEZ) of the two countries. It was a success of our side that the median line was accepted as the basis of the Agreement, despite the much larger coastline of Egypt. Our ambassador in Cairo Jimmy Droussiotis should be credited as well for this success. Eventually I signed an EEZ Agreement in Cairo on the 17th February 2003 with the Foreign Minister of Egypt Ahmed Maher, the first EEZ Agreement signed in the Eastern Mediterranean.
In Lebanon I had meetings on the 20th September 2002 with President Lahoud, Prime Minister Hariri and Petroleum Minister Baydoun. We reached with them a preliminary EEZ Agreement. The final Agreement was signed during the Papadopoulos presidency but it was not ratified by the Parliament of Lebanon. In Syria I had a meeting with vice President Khaddam without any results.
With my delegation we had useful meetings on the subject in Washington DC on the 30th April 2001 with the Minister of Energy Spencer Abraham and with the Minister of Commerce Don Evans. We also had meetings at the same time in Houston, Texas with former President George Bush and the President’s brother Neil Bush.
Furthermore we had a relevant meeting in Moscow, on the 28th March 2002, with the Minister of Technology Mikhail Kiprichnikov. In Algeria I met on the 12th December 2002 Petroleum Minister Chakib Khelil. I also had a number of meetings with the Ambassador of Israel in Cyprus on the subject. Before I passed the baton to my successor in office, we also started some preliminary surveys offshore Cyprus.
In those years the public and the media were not so kind to us. Today oil and gas are considered to be the golden eggs of Cyprus and probably the only ray of hope in the grim atmosphere of the Troika. Twelve years ago there was disbelief and an ironic attitude. The epitome of my efforts on oil and gas at the end of my tenure of office was a photograph of mine, published the day before I left office in one of the leading dailies, with the ironic title “Whenever you smell gas around remember me and my work”.
Nowadays, almost 10 years later, I note with a lot of satisfaction that the initial efforts were continued successfully under Presidents Papadopoulos and Christofias by Ministers George Lillikas, Antonis Michaelides, Antonis Paschalides, Praxoula Antoniadou and Neoklis Silikiotis with the valuable contribution of the Director of Energy Solon Kassinis.
So what are the prospects today?
(1) A quantity of 5-8 trillion cubic feet (tcf) of gas has already been preliminarily confirmed by Noble Energy in block 12. This is equivalent to 1‰ (one per thousand) of the world reserves which are approximately 6.4 quadrillion cubic feet. The position of Minister Fahmy of Egypt was that Cyprus in her overall EEZ may have as much as half per cent of the world reserves of oil and gas, out of the 2-3% which the Levant Basin may contain. The estimate of the US Geological Survey for the Levant Basin is that it contains 2% of the world reserves of gas. If the above estimates are correct, Cyprus may have 30-35 tcf of gas and a few billion barrels of oil.
(2) Such a wealth is really colossal for a small country. If the reserves are eventually proven and recoverable their value will run into hundreds of billions of US dollars. However patience and prudence are needed. As a rule, oil and gas reserves are not bankable before they are recovered. And if we want to be pragmatic and take into account various constraints, I do not believe that any money from gas, apart from the signature bonuses, will flow into our coffer before the lapse of 7-8 years from now. Furthermore the extraction will last for 25-30 years and a good part of the funds will be pocketed by the oil companies.
(3) To transfer the gas to our shore by undersea pipelines from the various blocks, investments in the region of US$2 billion or more will be required. Then, if we are going to liquefy and export the gas, with the exception of the quantity needed for internal use, another US$10-12 billion will be needed, depending on the size and number of trains of the liquefaction plant. No serious investor and serious financier will be interested unless:
a) The availability of the necessary quantity of gas per year for a period of 25-30 years is verified by experts
b) The markets and prices are projected to be satisfactory for the same period of time
c) The political and military hazards in Cyprus and the region do not constitute an impediment.
(4) Co-operation of the countries in the Levant Basin should be welcome. We have friendly relations with both Egypt and Lebanon, which will enhance such a co-operation. Israel in particular is ready to build a bridge of common interests with Cyprus. This is a very positive and welcome move. It is not clear though what the final position of the various players will be. I must confess that oil and gas producing countries cannot easily entrust their enormous hydrocarbon wealth to neighbours for processing. Especially when, apart from the financial aspect, political, military, security and strategic alliances issues hover in the air. Cyprus must be all eyes and must prove to be a cautious and wise player in this tricky game of trillions of US dollars in the Eastern Mediterranean. Any mistakes may be equivalent to disaster.
(5) And one last but most important point: Very frankly, when I commenced the oil and gas venture, I knew deep in my heart that a new dimension would be added to the Cyprus problem. The traditional issues, which used to be on the table for decades, such as the withdrawal of the Turkish troops, the constitution, the territory, the settlers, the properties etc. would not be sufficient any more. The taste and smell of oil and gas and the hundreds of billions of dollars they may represent one day, would be felt very strongly all over Cyprus and probably in Greece and Turkey as well.
The oil bonanza may prove to be a blessing or an Armageddon, depending on the wisdom of those who handle it. It is enormous in size, it is exploitable over many decades, so it entails risks and hazards which are spread over years and years. It constitutes a prey and an object of desire for those who, irrespective of what is right and what is wrong, irrespective of who has sovereignty and who has not, are strong, greedy and insatiable. The north of Cyprus which is occupied for 38 years is a good example.
Roman politician and philosopher Lucius Seneca had stated that “in all wars, from the Trojan war until today, the main cause has been the snatching of property”.
In recent years, I always felt that hydrocarbons might constitute the catalyst for a solution of the Cyprus problem and also of the wider conflicts in the triangle of Greece, Turkey and Cyprus. I have put forward a number of proposals to this end, which were positively viewed by many foreign governments. This is reflected in a statement which the President of the European Council Herman Van Rompuy made during a visit to Cyprus earlier this year. Van Rompuy said:
“The historic coalition between France and Germany after many wars was built on the idea of sharing coal. In one brilliant move political leaders on both sides turned around a situation, changing a mutual threat into a common opportunity. Just like France and Germany 60 years ago came together over coal, could in the case of Cyprus the avenue toward conciliation not be built on sharing and selling gas?”
I am sure that the Limassol entrepreneurs of the 1940s, who ploughed and lost their money into the barren earth surrounding the Meridien Hotel, would be very happy where they lie today, if their dedication and the efforts of many others produce an olive branch of peace out of the oil and gas, which had been their unaccomplished dream.
المقال الرابع
OIL AND GAS
WHO HELPED AT THE STARTING POINT
WHAT ABOUT TODAY?
بتاريخ: 5 إبريل 2012
In March 1998 I was appointed as Minister of Commerce, Industry & Tourism. I was the 13th Minister in a row in the 38 years of the Republic of Cyprus. Energy was included in my portfolio.
Energy was of special interest to me. When I was Foreign Minister 20 years back, US oil majors Standard Oil of Indiana and Amoco had expressed interest to drill offshore south of Limassol. President Kyprianou had asked me to communicate with U.N. Secretary-General Kurt Waldheim, who discouraged us because of many Turkish threats. I had the file with me at the new Ministry in 1998.
I also went down the memory lane of the Law of the Sea Convention, which was signed in 1982 at Montego Bay, Jamaica, a subject which I was then handling as Foreign Minister. I had in my mind as well a lot of oil and gas data in regard to our area, which I had studied.
But most importantly I had a strong belief and also a vision that oil and gas existed in the waters offshore Cyprus.
I was sitting in my office, alone, for long hours pondering over the subject. There was oil and gas produced in many countries of the world for the past 100 years. In Cyprus however no other Minister had pursued the subject during the past 38 years. Was I looking for trouble, as a person close to me indicated? Because in case of a fiasco I would ridicule both myself and the Government.
Finally, I decided to go on. At 7 o’clock in a morning of 1998 I was at the office of President Clerides. At the beginning he looked at me in a strange manner and he smiled. At the end however, after listening to my presentation, the President gave me the green light. I also had the blessing of the Cabinet, although my colleagues, as disclosed recently by then Minister Averof Neophytou, had many reservations.
I set up my team at the Ministry: Director-General Michael Erotokritos (and later on Sotiris Sotiriou) head of department Olympia Stylianou and energy chief Solon Kassinis.
I started in a negative atmosphere. I was faced with derision. This major issue, which may prove today to be a catalyst for the economic and national turnaround of the country, in those days was the subject of derogatory comments.
So, which were the countries, which stood by us and extended a helping hand, during those difficult first steps?
- Egypt: She was extremely helpful, on account of a very old friendship and her expertise on the subject. Egypt had in those years a daily production of 1,2 million barrels of oil (or oil equivalent). The Egyptians estimated that the Levant Basin, which includes Egypt, Israel, Lebanon, Syria, Cyprus, Gaza and part of southern Turkey, had reserves equal to 3% and 2% respectively of the gas and oil world reserves. Cyprus, according to the Egyptian estimate, has 0,5% of the world reserves of oil and gas. This is equal to 35 trillion cubic feet of gas and 6 billion barrels of oil, of a value of hundreds of billions of US dollars. Egypt’s Petroleum Minister Samer Fahmy was in close cooperation with us and we gradually agreed the Exclusive Economic Zones (EEZ) of our two countries on the basis of the median line. Eventually on the 17th February 2003 I signed in Cairo with the Foreign Minister of Egypt Ahmed Maher the EEZ Agreement, which was ratified by the Parliaments of the two countries and lodged with the United Nations. It was the first EEZ Agreement ever signed in Eastern Mediterranean.
2.
The United States of America: The estimate of the U.S. Geological Survey for the Levant Basin was 2% of the world oil and gas reserves, somehow lower than the Egyptian estimates, but still colossal in value, both for the Basin and for Cyprus. The Bush Administration was very interested in the Cyprus hydrocarbon reserves. On the 30th April 2001 two separate appointments were fixed for me in Washington DC, with the Minister of Energy Spencer Abraham and the Minister of Commerce Don Evans. I also had meetings at that time in Houston, Texas, with oil and gas experts, who made a presentation to us of the hydrocarbon data of our area. Furthermore I had meetings with the father of President Bush, former President George Bush and the President’s brother Neil Bush. I also met in New York on the 2nd May 2001 Senator John McCain, who was later on a Presidential candidate. The hydrocarbons of Cyprus were thus presented for the first time to the superpower.
3- The Russian Federation: The Russians were following discreetly but with a lot of interest our activation in connection with the hydrocarbons. The Russian Ambassador in Nicosia was updated, during our meetings on the subject. Furthermore I discussed oil and gas in Moscow with Russian ministers and with the leadership of the Russian Academy of Sciences on 23 March 2000, on 28 March 2002 and on 24 June 2002. During our meeting of the 28th March 2002 the Russian Minister of Technology Mikhail Kiprichnikov gave me a verbal message from President Vladimir Putin addressed to President Clerides “that the Russian Federation was very interested in the Cyprus hydrocarbons”.
4- Lebanon: With our Lebanese friends I discussed and reached an agreement regarding our EEZ. I was in Beirut on the 20th September 2002 where I met President Emile Lahoud, Prime Minister Rafik Hariri and Petroleum Minister Mohammed Beydoun. The EEZ Agreement was eventually signed during the Papadopoulos presidency, but unfortunately the Lebanese Parliament has not ratified it as yet.
5- Algeria: I was invited by Petroleum Minister Chakib Khelil and I visited Algiers on the 12th December 2002. Algeria is a major player in hydrocarbons with reserves of 12 billion barrels of oil and 150 trillion cubic feet of gas. Minister Khelil and giant state oil corporation Sonatrach gave us a lot of useful information.
In addition to the above I had meetings in Syria (visit on the 12th February 2002 and meeting with vice President Abdel Khadam) and with Israel, with whose ambassador in Cyprus we discussed preliminarily the EEZ Agreement.
It is with a lot of satisfaction that I notice that the oil and gas efforts were continued in the years to come. Today, 9 years later, a part of our reserves have been preliminarily confirmed by Noble Energy.
What worries me however is our handling of the hydrocarbon issue vis-à-vis the Turkish Cypriots and Turkey. I always thought that this potentially huge oil and gas wealth might constitute the catalyst for the solution of the Cyprus problem and of any issues between Greece, Turkey and Cyprus. In articles of mine over the past few years I made two relevant specific proposals which were upheld by a number of foreign embassies in Nicosia.
Turkey is a very dangerous country – we know better than anybody else. Hydrocarbons constitute a colossal wealth, and they are the cause of more than 50% of the wars and clashes on our planet. The exploitation of oil and gas is a very long term venture (25-35 years). If no arrangement is made the risk of hot incidents or of having Turkey pump our oil and gas will be always there.
I wrote it in the past as well: Oil may prove to be a blessing or a curse. The outcome will depend on us.
I would conclude by siting what the President of the European Council Herman van Rompuy said during his recent visit to Cyprus.
“The historic conciliation between France and Germany after many wars was built on the idea of sharing coal…In one brilliant move political leaders on both sides turned around a situation, changing a mutual threat into a common opportunity…Just like France and Germany 60 years ago came together over coal, could in the case of Cyprus the avenue toward conciliation not be built on sharing and selling gas?”
Is the above not what I exactly have been preaching over the past 5 years for the oil and gas of Cyprus?
المقال الخامس
OIL & GAS – THOUGHTS AND MEMORIES
بتاريخ: 7 ديسمبر 2011
On the 10th December 1982, in Montego Bay, Jamaica, man succeeded to rule the seas and the oceans. The vast wealth which lies in the oceans and below the sea-bed was regulated by the historic Convention on the Law of the Sea: It took more than 14 years of strenuous work to reach the Agreement; more than 150 countries and hundreds of diplomats participated. Cyprus was there as well.
I was Minister of Foreign Affairs at the time and we were handling the issue. In charge of our delegation was our Ambassador in Washington Andreas Iacovides, a distinguished diplomat, who was well conversant with the subject. On the first day the Convention was open for signature, 119 delegations were appended to the Convention, a world record at the time.
Cyprus has signed and ratified the Convention. Turkey rejected it. The U.S signed the Convention but the Senate has not ratified it, so there is no commitment.
Two and a half years before the Convention, on the 4th August 1980, I met in my office M.J. Ambrose, senior executive of U.S oil major Standard Oil of Indiana. Standard Oil, together with oil giant Amoco wanted to drill south of Cyprus, approximately where “Aphrodite” lies today. They were convinced that we had hydrocarbons down there. However Turkey, which was apparently well informed, had threatened, in accordance with the minutes of the Ministry, that she “would take further military action in Cyprus”. President Kyprianou, who received Ambrose in his office on the following day, asked me to communicate with U.N. Secretary General Kurt Waldheim. Waldheim’s advice was that we should postpone the matter. So the “dream” was not implemented at that time.
The Standard Oil of Indiana file, which included the “dream”, with copies of the minutes, I took with me to the Ministry of Commerce, Industry and Tourism, almost 20 years later. I remember that I put it on the right hand side of my desk, to remind me of the “oil project”. A few months later I spoke to President Clerides about the subject, who gave me the green light, with some skepticism. So, the great march of the Cyprus oil and gas commenced, amidst derision and ironic comments from many quarters. I had in my team Ministry Director-General Michael Erotokritos (and later Soteris Soteriou), Director Olympia Stylianou and Energy Director Solon Kassinis. I negotiated with Egypt’s Petroleum Minister Samer Fahmy and we signed in Cairo on 17.2.2003 the Agreement about the Exclusive Economic Zones (EEZ) of the two countries. It was the first EEZ Agreement ever in the area. We negotiated and reached a preliminary Agreement with Lebanon, during my meetings in Beirut, in September 2002, with President Lahoud, Prime Minister Hariri and Energy Minister Baydoun. I met in Damascus Vice-President Khaddam, but we failed to reach an agreement. I started a dialogue with Israel. The march continued during the presidencies of Papadopoulos and Christofias and now the drill is below the seabed.
On this occasion I would like to refer to some details, which I believe the average citizen should know in regard to the possible oil and gas wealth of our country.
1. Reserves: On the basis of existing information it appears that we have gas reserves and possibly oil reserves as well. The reserves, depending on the degree of certainty of their existence are rated in four categories: (a) probable, (b) possible, (c) proven and (d) recoverable. Cyprus today, according to foreign experts, friends of mine, is between “probable” and “possible”: If and when we reach the “proven” stage we must know that a percentage of the “proven” will not be recoverable.
On the basis of the announcements of Noble Energy thus far, if we assume that block “Aphrodite” has 8 trillion cubic feet of natural gas (possibility of success 60% according to Noble) this would be equivalent to a little more than one per thousand of the world reserves, which in 2009 were 6,3 quadrillion cubic feet (Oil and Gas Journal). We may have oil as well, whose percentage most probably is lower than that of natural gas. World reserves of oil: 1,3 trillion barrels (Oil and Gas Journal). Totally Cyprus, in the whole of her EEZ, in accordance with estimates made by the Egyptians may have 1/2 % (one half per cent) of natural gas and oil of the world reserves.
It is a remarkable quantity, much smaller though than the fantasies and mythomania of some people who think that we shall replace Gazprom as gas providers of Europe!! Russia and Gazprom own one quadrillion and 680 trillion cubic feet of natural gas, (namely 27% of the world reserves) a figure by 210 times higher than the gas estimates of the “Aphrodite” block.
2. Expression of interest: We often have official statements that “colossal oil companies” are interested to participate in Cyprus, because they have bought the data on off-shore oil potentials. There may be companies which are interested, however the purchase of the data has nothing to do with such an interest. All important oil companies have a budget to buy such data from all corners of the world, which they file in their data rooms. The purchase of data is completely unrelated to an interest to participate in Cyprus.
3. Agreements: I have studied many “Profit Sharing Agreements” between Governments and Oil Companies and I am in touch with persons knowledgeable about the subject. I do not know which are the contents of the Agreement between Cyprus and Noble Energy. In general terms however an Oil Agreement should be along the following lines:
(A) A “signature bonus” is payable to the Government upon signature. The bonus may vary from $1m to $80m depending on the size of the deal and the degree of certainty of the reserves.
(B) When the pumping of gas or oil starts, the Government receives “off-the-top” royalties on the daily production which vary between 10% (in the Middle East and Africa) and 38% (in Canada).
(C) After the payment of the royalties, the oil company covers its current expenses and the depreciation of its investments. A lot of care is needed in this regard, including expert knowledge of what is chargeable and what is not. In the absence of such expertise and a correct audit, the Government may be left with marginal or no profits.
(D) What is left is called “profit oil” and it is divided between the Government (80%) and the oil company (20%).
(E) In many Agreements there is also a so-called “production bonus”, which amounts to $5m-$10m each time, and is paid to the Government when the daily production exceeds certain pre-agreed thresholds.
4. Threats and problems in the area: Despite the “Convention on the law of the sea”, conflicts and hostilities in connection with the immense off shore oil wealth take place quite often. Disputes or clashes have occurred at times, amongst other cases, between Senegal and Guinea-Bissau, Nigeria and Cameroon, Equatorial Guinea and Gabon, China and Malaysia/Indonesia, Myanmar and India, Russia and Japan, Greece and Turkey, Malta and Libya, Canada and France (French islands close to Canada) and recently Lebanon and Israel.
In our case Turkey claims the whole or part of our EEZ, based on the “rights of the Turkish Cypriots” and on the fact that she has declined to sign the Convention of 1982. The problem is not easy and the naïve repetition of our stand regarding our sovereignty and our rights does not resolve it. We have sovereignty over the north of Cyprus as well, but we have not been able to exert our rights during the past 37 years. Turkey is a very difficult, unpredictable and dangerous country. Personally I have made my proposal for an Agreement with the Turkish Cypriots, in such a way that our sovereignty and rights will not be affected. We should under no circumstances risk the nightmare-scenario of having Turkey pump our oil and gas (who is going to stop her?) or lead us into other adventures.
I believe that we have sufficient quantities of oil and gas, very large compared to the size of our country. We simply need a lesser degree of fantasy and mythomania and more prudence.
المقال السادس
CHRISTOFIAS (RISE AND FALL) AND OFFSHORE OIL & GAS
بتاريخ: 15 سبتمبر 2011
I know Demetris Christofias since 1987. That was the time when he emerged, as a new political star in the horizon. The AKEL chief for 40 years, Ezekias Papaioannou, was already in old age. I had excellent relations with Papaioannou, since the days of my tenure of the office of Foreign Minister. In those years I used to spend together with the political leaders of Cyprus long periods of time in New York, for the Cyprus recourses to the United Nations.
Papaioannou had disclosed to me that he considered Christofias fit to become the new AKEL chief. He was going to bypass the incumbent leadership. Furthermore he decided to appoint Demetris, in July 1987, as liaison officer between AKEL and my party (The Liberal Party). At that time we both supported George Vassiliou at the presidential elections of February 1988.
Demetris, a young man with a bright face, unpretentious, honest, kind-hearted and sensitive had all the traits that Ezekias required. But he also possessed the supreme characteristic, which was a sine qua non for Ezekias: Moscow was Demetris’ holy shrine and its teachings were the holy communion for him.
I was musing recently, bringing back before my eyes - like a tragic vision – the smiling and carefree face of Demetris of those years, in a mix up with the images of those who perished as a result of the indifference and the irresponsibility displayed in connection with the 11th July. Young men, who could have easily been the children or grand children of most of us…. I could also see the “indignados”, the tears, the pain, the bitter despair. Everybody and everything were targeting Demetris – after all whom they target, other than the leader? And I questioned myself, how did this man, who started his life as a barefoot boy at Dikomo village and managed to elevate himself to the supreme red carpet echelons of power, how did he really end up to be included in the curses of the mother, the father, the wife, the children of the “13”, who were sound and strong at 5.45 a.m on the 11th July and in a split of a second they were converted into fine dust, into “nothing” into a “blow of the wind” as Greek poet Costis Palamas had put in his poem “The tomb”: Does Demetris “sleep at night” I asked my wife Lelia the other day… and we both remained silent.
With Demetris I worked together on many occasions since 1987. From July 1987 to February 1988 he visited often the office of the Liberal Party at Makarios Avenue, near the Hilton. Thereafter, when Vassiliou was elected, we spent 6 weeks in the summer and 3 weeks in November 1992 for the talks on the Ghali “Set of Ideas” at the Waldorf Astoria, in New York. We also worked together in 1997 at Troutbeck (USA) and Glion (Switzerland) during the talks of Clerides-Denktas.
In our talks Demetris was a realist and down to earth. His party however was his first and foremost care, everything else followed. He had strong social sensitivities – he was desperately seeking the true social justice – which has never existed and will never appear in this ruthless world of ours, irrespective of the efforts of Demetris and his likes. He believed firmly that communism is the source of such a justice, ignoring the despicable events in the Soviet Union (Siberia, intrigues, murders of millions of people) from the revolution of 1917 to the collapse of the system in 1990. After all, AKEL has made it clear many times in the past – and as far as I know it never retracted this position – that if and when the Cyprus problem is resolved, its objective will be the introduction of a soviet type communist system in Cyprus.
I believe that the events at Mari emanate from two main elements out of the credos of President Christofias:
- His deep devotion to communism and his intense dislike of “imperialism” have guided him to follow the wrong path in regard to the deadly cargo. Demetris may be flattered by the fact that he rubs shoulders with the European political elite, he may have found an ally, Israel, who was imposed on him by the oil potential. But in reality his heart, his inner self, is always close to the Fidel Castros (opening of embassy which he personally attended), the Assads (“we are in the same trench” – my God, what a trench) and the Chavezes (cheap oil, which we never saw) of this planet. So he kept “death” in Cyprus “for political reasons”, so that he might hand over the cargo to Assad one day, as he apparently promised him. At the end of the day “death” exploded and killed. It also caused a crippling damage to the economy.
- The peculiar way in which Christofias apparently runs the country, probably influenced by the soviet standards. In Moscow of the old days, if a directive of Brezhnev was not executed and things went wrong, he would remain seated on his throne and heads would start rolling. Could this ever apply in Cyprus? Could the supreme Commander run the country without having before his eyes hundreds of notes in respect of important issues delegated to his ministers, for an effective follow-up? Is it really possible that the phrase uttered by former Minister Papacostas: “Marcos (Kyprianou), you have shifted the burden of responsibility onto my shoulders and you are all pulling out” be the ultimate tune ringing in our ears, as the epilogue of this tragedy?
At this point I would like to refer to another subject to which I believe the President should pay a lot of heed. This is necessary, to avoid a repetition of the presidential phrase “but I did not know, so take Praxoula and Erato to the execution squad”.
- In the offshore Exclusive Economic Zone (EEZ) of Cyprus there are apparently rather large quantities of oil and/or natural gas (not as big as the imagination of some people created them, but huge by the standards of Cyprus). Actually I was the first one to state that we probably have oil and gas in the sea, 10-12 years ago, and as a result I became the object of derision. In this regard in February 2003 I signed with Egypt the first Agreement in the Eastern Mediterranean for the EEZ of Cyprus and Egypt and I also commenced negotiations with Lebanon, Syria and Israel. Now everybody is running after oil.
- Oil, historically has been a source of wealth and welfare but at the same time it has caused havoc, because of the colossal interests. In our case there have been persistent and dangerous claims by Turkey, which has declined to sign the Law of the Sea Convention of 1982. Recently Lebanon (which has declined to confirm the EEZ Agreement sighed with us, consequently there is no agreement) raises objections too. So, apart from the small player (Cyprus) we now have the big boys in the game: Israel, Turkey and Lebanon (and Hezbollah which hides behind Lebanon).
- I could “smell” the dangers from the very outset. This was actually the reason why Greece has avoided for the past 35 years any involvement in the Aegean oil – she now talks only about oil in the lonian Sea and offshore Crete (so, how will Greece protect us?) Consequently I put forward a Plan, which I repeated many times during the past 5 years. Under the Plan we should seek an agreement with the Turkish Cypriots (not with Turkey) under the auspices of the United Nations. The Plan would provide that out of the net income of the Republic of Cyprus from oil and gas reserves a percentage to be agreed would be deposited in an escrow account in favour of the Turkish Cypriots, payable either upon solution of the Cyprus problem or at a fixed time to be agreed, whichever happens earlier. Turkish Cypriot leader Talat welcomed my proposal and he told me that if the Cyprus Government would accept the Plan he was prepared to take it up with Ankara. Our own side however said nothing.
- The above proposal would entail a protection of our self respect and our sovereignty (which are now in danger), the avoidance of any military adventure and a constructive gesture to the other community which might prove conducive to the solution of the Cyprus problem. We would also be enabled to proceed without delay and without any hindrance with the exploitation of our hydrocarbon wealth, which may be worth $400-$500 billion or 0.5% of the world reserves, before it is cannibalized by our neighbours.
- When very large interests are involved, strong countries do not easily back out. And as the wise man of Africa former President of Tanzania Julius Nyerere once said (he used an old African proverb): “When elephants fight it is the grass below their feet that suffers”. In our case, between Israel, Turkey, Hezbollah and Cyprus, we are unfortunately the grass.
المقال السابع
CYPRUS, ISLAND OF LOVE AND… OF NATURAL GAS
بتاريخ: 10 فبراير 2011
The song was written sometime ago and its subject was love and dream: “Cyprus, the island of love and dream”. It was written in the old days, when poet Leonidas Malenis and composer Mikis Theodorakis, as well as the average man in Cyprus, knew how to sing for love and dream. It was when life in Cyprus was not so much connected with huge financial interests, with oil, technology and the stock markets.
It appears that today the “dream” is not the same anymore. And the sea, about which so many lyrics have been written, is not so special nowadays for the reflection of the beauty of the moon, but because of “oil block 12”, the “Leviathan” of Israel and the billions of barrels of oil it contains.
I have to confess that, despite my poetic nature, I was the first one to introduce in Cyprus the subject of the off-shore oil. In August 1980 (I was Foreign Minister at the time) I had a meeting in my office with Mr. Ambrose, a senior executive of U.S. oil major Standard Oil of Indiana. The company was interested to invest millions for oil exploration in the sea south of Limassol. Judging by what I was told I realized that Cyprus probably had within her reach an incredible oil bonanza.
U.N. Secretary-General Kurt Waldheim dissuaded us from proceeding, because Turkey had threatened that she would take “further military action”. President Kyprianou and I considered that we should wait. After all, in those days, a short while after the Turkish invasion, the situation was potentially explosive.
In 1998 I became Minister of Commerce, Industry and Tourism. Energy was one of my portfolios. We contacted Egypt and a number of other countries in respect of oil. And it appears that the assessment of the Egyptians, disclosed to me by Egyptian Minister of Petroleum Samer Fahmy was correct. The experienced Egyptians estimated that the reserves of oil and oil equivalent (160 cubic metres of natural gas are equivalent to one barrel of oil) in the Exclusive Economic Zone of Cyprus were probably 5-8 billion barrels. So, if we have an average six billion barrels of oil, as estimated by the Egyptians, this would be equivalent to 0.5% (half per cent) of the world oil reserves and would have a value at current prices (after deducting the cost of exploration and the share of the oil companies) of 400-450 billion U.S. dollars. So, a small country, Cyprus, whose size of the economy (gross domestic product) is in the region of 17 billion euros (23 billion U.S. dollars) may be sitting on an enormous wealth or on a volcano.
History has proven that most wars were triggered off by financial interests, rather than principles. Roman politician and philosopher Lucius Seneca has stated that “in all wars, from the Trojan war until today, the main cause has been the snatching of property”.
The above subject had occupied my mind since the days when I was Minister responsible for energy. Turkey had always been catapulting her threats against us. The potential great oil wealth could have been a blessing or a disaster, depending on our wisdom. I had noted that Greece was handling the question of her own oil in the Aegean Sea with a lot of caution. Despite her European identity, which dated back to the early 1980s and despite her military capabilities, which are by far larger than those of Cyprus, Greece has always displayed a lot of restraint. George Papandreou at his meeting with President Christofias of the 3rd February, followed the same tactics. The same caution is also displayed on oil issues by many other countries in the world.
One wonders therefore, how some of our politicians and ministers proceed with such a confidence towards the drilling process, invoking our sovereign rights. Greece has no sovereign rights? Or is it that the Greeks are easily scared off, whilst we Cypriots are real patriots. And if, God forbid, we have a military confrontation over our offshore oil, what sort of support do our politicians anticipate? Will Greece offer military support? But Greece has avoided the clash over her own reserves. Will she extend military help to us? Especially at a time when financial straits have forced her to curtail substantially her military budget?
In parallel, our politicians rely or our European identity. But then the question arises why Greece does not rely on her European identity as well and why does she not proceed with drilling?
Furthermore, I consider that the idea of inviting another country to jointly exploit with us our oil reserves does not make any sense and is not an easy task at all. In such a case Turkey may act forcefully and destructively against us (and not necessarily against the other country). It should also be noted that important countries (with which we might wish to co-exploit), and large oil companies are usually extremely conservative. They avoid implications in trouble areas and they will not jeopardize their oil and other interests in a large market like Turkey.
In the light of the above, I worked on a balanced Plan which might constitute a way out. It would also result in a long term stability in the field of our hydrocarbons.
The plan, which I publicized in the past as well, provides for an ad hoc Agreement between the two communities, irrespective of the solution of the Cyprus problem. In parallel to the Agreement a Disclaimer would have to be signed, making it clear that the Plan does not constitute a legal or financial or political precedent. On the basis of the Plan, out of the net profit of the Republic of Cyprus from the hydrocarbon exploitation, a percentage to be agreed, would be deposited in an escrow account in favour of the Turkish Cypriot community. The amount in the escrow account would become payable to the Turkish Cypriots either upon solution of the Cyprus problem or at a future date to be agreed, whichever happens earlier.
AKEL had taken the stand in the past that the Turkish Cypriots are entitled to a percentage of the oil profits. The administration of Tassos Papadopoulos did not support my Plan. Mehmet Ali Talat had viewed the Plan positively and told me that if the Plan could be upheld, he would take up the matter with Ankara.
If the Plan could be adopted, we might proceed with the hydrocarbon exploration without the risk of a clash and without delay. The Turkish Cypriots would take a reasonable part of a potentially enormous oil national wealth. We would also avoid the risk of having our neighbours pump our own oil. Because when our neighbours are pumping oil and natural gas and we are not, part of the reserves will flow to their side on the basis of the physics law of communicating vessels.
Besides, if we are to jointly exploit our hydrocarbons with other countries (which is extremely difficult as I explain above), why should we not give a part to the Turkish Cypriots instead, and secure a long term stability and an easy way forward.
I am sure that the “hydrocarbon” issue will have to be addressed by President Christofias at a certain stage in the talks. The value of the off-shore reserves may well be quite higher than the value of the on-shore properties. So, the hydrocarbon chapter may be thorny and difficult to resolve. I hope that the President will handle it with the necessary wisdom.
Poet Costas Montis in his work “Feeling bitter within”, made reference to the Turkish invaders of 1974 and wrote: “It is difficult to believe that the beloved sea of Kyrenia has brought them to us”. The pain of the poet is justified. The truth however is that it is not the sea of Kyrenia that has brought them into Cyprus. They came in, because of Turkey’s strategic plans, which became more feasible on account of our blunders and mishandlings as well, which happened at a time when we thought that we were omniscient and that we could rule the world.
So, let us watch carefully our future steps in the field of oil. It is a potentially huge and explosive subject. Let us not proceed thoughtlessly and superficially. Let us not allow the tragedy to happen again - and then blame once more the “beloved sea of Kyrenia”.
