The United States Army War College

U.S. ARMY WAR COLLEGE

CENTER for

STRATEGIC

LEADERSHIP and

DEVELOPMENT

The United States Army War College educates and develops leaders for service 

at the strategic level while advancing knowledge in the global application 

of Landpower.

The purpose of the United States Army War College is to produce graduates 

who are skilled critical thinkers and complex problem solvers. Concurrently, 

it is our duty to the U.S. Army to also act as a “think factory” for commanders 

and civilian leaders at the strategic level worldwide and routinely engage 

in discourse and debate concerning the role of ground forces in achieving 

national security objectives.

The Strategic Studies Institute publishes national 

security and strategic research and analysis to influence 

policy debate and bridge the gap between military 

and academia.

The Center for Strategic Leadership and Development 

contributes to the education of world class senior 

leaders, develops expert knowledge, and provides 

solutions to strategic Army issues affecting the national 

security community.

The Peacekeeping and Stability Operations Institute 

provides subject matter expertise, technical review, 

and writing expertise to agencies that develop stability 

operations concepts and doctrines.

The Senior Leader Development and Resiliency program 

supports the United States Army War College’s lines of 

effort to educate strategic leaders and provide well-being 

education and support by developing self-awareness 

through leader feedback and leader resiliency.

The School of Strategic Landpower develops strategic 

leaders by providing a strong foundation of wisdom 

grounded in mastery of the profession of arms, and 

by serving as a crucible for educating future leaders in 

the analysis, evaluation, and refinement of professional 

expertise in war, strategy, operations, national security, 

resource management, and responsible command.

The U.S. Army Heritage and Education Center acquires, 

conserves, and exhibits historical materials for use 

to support the U.S. Army, educate an international 

audience, and honor Soldiers—past and present.

U.S. Army War College

Senior Leader Development and Resiliency

SLDR
i

STRATEGIC

STUDIES

INSTITUTE

The Strategic Studies Institute (SSI) is part of the U.S. Army War 

College and is the strategic-level study agent for issues related 

to national security and military strategy with emphasis on 

geostrategic analysis.

The mission of SSI is to use independent analysis to conduct strategic 

studies that develop policy recommendations on:

• Strategy, planning, and policy for joint and combined 

 employment of military forces;

• Regional strategic appraisals;

• The nature of land warfare;

• Matters affecting the Army’s future;

• The concepts, philosophy, and theory of strategy; and,

• Other issues of importance to the leadership of the Army.

Studies produced by civilian and military analysts concern 

topics having strategic implications for the Army, the Department of 

Defense, and the larger national security community.

In addition to its studies, SSI publishes special reports on topics 

of special or immediate interest. These include edited proceedings 

of conferences and topically oriented roundtables, expanded trip 

reports, and quick-reaction responses to senior Army leaders.

The Institute provides a valuable analytical capability within the 

Army to address strategic and other issues in support of Army 

participation in national security policy formulation.

iii

Strategic Studies Institute

and

U.S. Army War College Press

REGIONALIZING EAST MEDITERRANEAN GAS:

ENERGY SECURITY, STABILITY, 

AND THE U.S. ROLE

Laura El-Katiri

Mohammed El-Katiri

December 2014

The views expressed in this report are those of the authors and 

do not necessarily reflect the official policy or position of the 

Department of the Army, the Department of Defense, or the U.S. 

Government. Authors of Strategic Studies Institute (SSI) and 

U.S. Army War College (USAWC) Press publications enjoy full 

academic freedom, provided they do not disclose classified 

information, jeopardize operations security, or misrepresent 

official U.S. policy. Such academic freedom empowers them to 

offer new and sometimes controversial perspectives in the interest of furthering debate on key issues. This report is cleared for 

public release; distribution is unlimited.

*****

This publication is subject to Title 17, United States Code, 

Sections 101 and 105. It is in the public domain and may not be 

copyrighted.
iv

*****

Comments pertaining to this report are invited and should 

be forwarded to: Director, Strategic Studies Institute and U.S. 

Army War College Press, U.S. Army War College, 47 Ashburn 

Drive, Carlisle, PA 17013-5010. 

*****

This manuscript was funded by the U.S. Army War 

College External Research Associates Program. Information on 

this program is available on our website, www.StrategicStudies

Institute.army.mil, at the Opportunities tab.

*****

All Strategic Studies Institute (SSI) and U.S. Army War 

College (USAWC) Press publications may be downloaded free 

of charge from the SSI website. Hard copies of this report may 

also be obtained free of charge while supplies last by placing 

an order on the SSI website. SSI publications may be quoted 

or reprinted in part or in full with permission and appropriate 

credit given to the U.S. Army Strategic Studies Institute and U.S. 

Army War College Press, U.S. Army War College, Carlisle, PA. 

Contact SSI by visiting our website at the following address: 

www.StrategicStudiesInstitute.army.mil.

*****

The Strategic Studies Institute and U.S. Army War 

College Press publishes a monthly email newsletter to update 

the national security community on the research of our analysts,

recent and forthcoming publications, and upcoming conferences sponsored by the Institute. Each newsletter also provides 

a strategic commentary by one of our research analysts. If you 

are interested in receiving this newsletter, please subscribe on the 

SSI website at www.StrategicStudiesInstitute.army.mil/newsletter.

ISBN 1-58487-657-3
v

FOREWORD

In recent years the distribution of the world’s exploitable energy reserves has shifted markedly. One 

major change is the discovery of substantial gas deposits offshore the Levant. But while these deposits 

have the potential to revolutionize the economies of 

the net energy importers, Cyprus, Lebanon, and Israel, 

they also bring into sharp focus long-running disputes 

over maritime boundaries and sovereignty. In short, 

these deposits provide yet another cause for conflict 

in an already deeply troubled region. 

This monograph explores both the positive and 

negative implications of the Eastern Mediterranean’s 

new gas reserves for the region, and the implications 

of both for U.S. interests. It combines the recognized 

expertise of two researchers with long experience 

in regional and energy studies, respectively. Their 

conclusion is that the management of these new energy resources is likely to influence significantly the 

relationships among the states in the region, particularly between Israel and its neighbors, including the 

Palestinian Territories. 

The Strategic Studies Institute therefore recommends this monograph not only for its direct relevance 

to energy studies, but also to policymakers working 

with the broader issues of the Levant and Eastern 

Mediterranean as a whole.

 

 DOUGLAS C. LOVELACE, JR.

 Director

 Strategic Studies Institute and

 U.S. Army War College Press

vii

ABOUT THE AUTHORS

LAURA EL-KATIRI is a London-based academic who 

formerly taught at the Department of Financial and 

Management Studies at the School of Oriental African 

Studies, University of London. Her primary research 

is in oil markets and energy policy, with special focus 

on the Middle East and North Africa. Ms. El-Katiri has 

published widely on issues including oil and development in the Arab world, natural resource wealth in 

resource-rich economies, domestic energy market and 

pricing reform, and energy poverty; she has followed 

the East Mediterranean region’s energy development 

for many years.

MOHAMMED EL-KATIRI is a Director of MENA Insight, a political risk consultancy that focuses on the 

Middle East and North Africa, and a Senior Research 

Analyst at the United Kingdom’s (UK) Conflict Studies Research Centre (CSRC). Before joining CSRC, Dr. 

El-Katiri was a Research Fellow at the UK Defence 

Academy, and later served as a Political Risk Analyst 

at Eurasia Group and as a Senior Researcher at the 

Hague Institute for Global Justice. With more than 10 

years of regional experience, Dr. El-Katiri focuses his 

research interests on political and economic security in 

North Africa and the Gulf Cooperation Council (GCC) 

states, as well as on North African relations with the 

European Union and security policies around the 

Mediterranean. Dr. El-Katiri has published numerous 

internal and external UK Defence Academy reports, 

including reference papers on national and regional 

security issues in the GCC and the Mediterranean, 

and a monograph on the Algerian national oil and gas 

company, Sonatrach. In addition, his publications in-
viii

clude commentaries and research papers in a range of 

languages for research organizations in the UK and 

Europe, as well as various newspaper articles in and 

about the region. Dr. El-Katiri is a frequent media 

commentator, including for the British Broadcasting 

Company, the Financial Times, and Al-Jazeera.
ix

SUMMARY

The East Mediterranean has been witnessing an 

unparalleled natural resource boom since the late2000s, when Israel, followed by Cyprus, made its first 

significant offshore hydrocarbon discoveries in many 

years. These discoveries have since proven to be substantially larger than any other resources previously 

explored in the East Mediterranean Sea. A 2010 U.S. 

Geological Survey suggests the Levant basin—the 

area including Cyprus and Israel’s offshore zones, 

and the offshore and some onshore territories of Syria, 

Lebanon, and the Palestinian Territories—could hold 

as many as 1.7 billion barrels of oil and up to 122 trillion cubic feet (tcf) of natural gas, leaving as much as 

two thirds of the region’s potential resource base still 

undiscovered.

The East Mediterranean’s newly discovered and 

potential future hydrocarbon resources are of tremendous economic and geostrategic significance, not 

only for the region itself but also for its main allies, 

including the United States. Economically, emerging 

gas producers Israel and Cyprus stand to gain considerably from their newly discovered gas wealth, which 

provides both a cost-effective source of energy for their 

historically import-dependent energy economies and 

a potential high-value source of revenues from gas exports into and beyond the region. Geostrategically, the 

presence of hydrocarbon resources in the East Mediterranean opens a great deal of opportunity for closer 

regional cooperation, but it also raises the potential 

for conflict over these valuable resources. The region 

also hosts two of the world’s most intractable border 

conflicts: the Arab-Israeli conflict, involving territorial 

disputes between Israel, the Palestinians, Lebanon, 
and Syria, and the unresolved Cypriot question, leading to disputed boundaries on land and at sea and 

disputed ownership over hydrocarbon resources between the Greek- and Turkish-Cypriot communities. 

This shifting energy landscape in the East Mediterranean is thus also significant for the region’s main 

political and military partnerships. Israel, Cyprus, 

and Turkey are key strategic U.S. allies. Neighboring 

Egypt, Syria and Lebanon play important roles from 

the European and U.S. perspective, both as direct 

neighbors to Israel and the Palestinian Territories as 

well as because of their strategically important location as the geographic interconnection between Europe, North Africa, and the Middle East. Regional and 

extra-regional military alliances could be put under 

tension as a result of shifting geopolitical weight and 

relations between the key regional players, as well as 

the risk of re-emerging boundary conflicts following 

discoveries of subsea hydrocarbon resources. There 

is the potential for considerable policy dilemmas for 

the United States, if its local security partners find 

themselves having a confrontation over hydrocarbon 

resources and maritime boundaries. 

This monograph provides an overview of recent 

hydrocarbon discoveries and their significance for the 

region’s resource holders; it also explores the possible 

implications of these resources for the region’s security landscape, their potential to fuel conflict, and options to foster closer regional cooperation and trade 

integration. It discusses the role U.S. diplomacy and 

military support could play to ensure continued stability, security, and regional support within the East 

Mediterranean’s shifting geoeconomic framework.

x
1

REGIONALIZING EAST MEDITERRANEAN GAS:

ENERGY SECURITY, STABILITY, 

AND THE U.S. ROLE

INTRODUCTION

The East Mediterranean has been witnessing an 

unparalleled natural resource boom since the late2000s, when Israel, followed by Cyprus, made its first 

significant offshore hydrocarbon discoveries in many 

years. These discoveries have since proven to be substantially larger than any other resources previously 

explored in the East Mediterranean Sea. At the time of 

this writing, they consist primarily of natural gas, although liquids are expected to be discovered offshore 

as well, including in the potentially hydrocarbon-rich 

waters of Lebanon and Syria. A 2010 U.S. Geological 

Survey suggests the Levant basin—the area including 

Cyprus and Israel’s offshore zones, and the offshore 

and some onshore territories of Syria, Lebanon, and 

the Palestinian Territories—could hold as much as 

1.7 billion barrels of oil and up to 122 trillion cubic 

feet (tcf) of natural gas, leaving as much as two-thirds 

of the region’s potential resource base still 

undiscovered.1

The East Mediterranean’s newly discovered and 

potential future hydrocarbon resources are of tremendous economic and geostrategic significance not 

only for the region itself but also for its main allies, 

including the United States. Economically, emerging 

gas producers Israel and Cyprus stand to gain considerably from their newly discovered gas wealth, 

which provides both a cost-effective source of energy 

for their historically import-dependent energy economies, and a potential high-value source of revenues 

from gas exports into and beyond the region. 
2

Geostrategically, the presence of hydrocarbon resources in the East Mediterranean opens a great deal 

of opportunity for closer regional cooperation, but it 

also raises the potential for conflict over these valuable 

resources. The region also hosts two of the world’s 

most intractable border conflicts: the Arab-Israeli conflict, involving territorial disputes between Israel, the 

Palestinians, Lebanon, and Syria, and the unresolved 

Cypriot question, leading to disputes over boundaries on land and at sea, and disputes of the ownership 

over hydrocarbon resources, between the Greek- and 

Turkish-Cypriot communities. 

This shifting energy landscape in the East Mediterranean is also significant for the region’s main political 

and military allies. Israel, Cyprus, and Turkey are key 

strategic U.S. allies. Neighboring Egypt, Syria, and 

Lebanon play important roles from the European and 

U.S. perspective, both as direct neighbors to Israel and 

the Palestinian Territories as well as because of their 

strategically important location as the geographic interconnection between Europe, North Africa, and the 

Middle East. Regional and extra-regional military alliances could be put under tension as a result of shifting 

geopolitical weight and relations between key regional players, as well as the risk of re-emerging boundary 

conflicts following discoveries of subsea hydrocarbon 

resources. There is the potential for considerable policy dilemmas for the United States, if its local security 

partners find themselves in conflict over hydrocarbon 

resources and maritime boundaries. 

This monograph will explore the strategic consequences of recent natural gas discoveries for the East 

Mediterranean security landscape, through the lens of 

U.S. security interests in the region. It first provides an 

overview of recent hydrocarbon discoveries and their 
3

significance for the region’s resource holders; this is 

followed by an exploration of the possible implications 

of these resources for the region’s security landscape, 

their potential to fuel conflict, and options to foster 

closer regional cooperation and trade integration. We 

then look at the role U.S. diplomacy and military support could play to ensure continued stability, security, 

and regional support within the East Mediterranean’s 

shifting geoeconomic framework.

BACKGROUND: A BRIEF SUMMARY 

OF EAST MEDITERRANEAN 

HYDROCARBON DEVELOPMENTS IN THE 2000s

The East Mediterranean has been a relatively slow 

starter in terms of offshore exploratory activities. With 

most exploration work focused on less challenging 

on-land territory, much of the Levant appeared to be 

the Middle East’s only remaining hydrocarbon-poor 

province. With the exception of Syria, which had 

been the only regional producer of significant oil and 

natural gas for several decades,2 the remainder of the 

East Mediterranean was, as a result, a net-importing 

region, with Israelis, Cypriots, Lebanese, and Palestinians having long depended on imports for virtually 

their entire domestic energy needs.3 The recent discoveries offshore Israel and Cyprus will completely 

change this picture: similar prospects for Lebanon 

and, potentially, the Palestinians could emerge if similar commercially viable hydrocarbon deposits materialize in their own territorial waters.
4

Israel’s Breakthrough Discoveries.

Israel has one of the East Mediterranean’s most 

extensive exploration histories, reaching back as 

far as the 1950s. As direct consequence of the ArabIsraeli conflict and Israel’s resulting isolation among 

its Arab neighbors, there was strong historical interest 

in any means of increasing the country’s energy selfsufficiency, and thereby in reducing Israel’s exposure 

to supply risks via trade embargos and the interruption of trade routes by land and sea.4

 While it soon 

became apparent that the Levant—the small strip of 

land extending from Syria in the North down southward to the Gaza Strip—would be no second Arabian 

Peninsula in terms of hydrocarbon resources, Israeli 

exploration efforts were rewarded in 1998-99 with the 

small, but nevertheless significant, discovery of the 

Noa and Mari-B fields just off the Israeli coastline.5

The two fields were comparably small, but with 1.5-

tcf of reserves, Mari-B proved large enough to make 

production commercially viable and to contribute toward Israel’s domestic gas supply by the mid-2000s.6

Mari-B has been in operation since 2004, and together 

with Noa, remains until today Israel’s only producing 

gas fields, covering around 60 percent of the country’s 

natural gas demand.7

The picture of some isolated, small Israeli gas finds 

changed significantly during the late-2000s, however. 

Owing to consistent further exploration efforts, Israel 

was able to report a series of commercial gas discoveries starting in 2009, with the discovery of the 9.7-tcf 

Tamar field by a consortium led by U.S. Noble in cooperation with several smaller Israeli companies.8

 This 

large (by East Mediterranean standards) exploration 

success was further topped by the 2010 discovery of 
5

the 19-tcf Leviathan field close to the maritime boundary with Cyprus, which has so far remained one of the 

largest single discoveries in the entire offshore Mediterranean.9

 Discoveries followed of smaller fields: 

Sara (1.47-tcf) and Dalit (350-530 million cubic feet), 

both in 2009, Myra (4.24-tcf) in 2010, and further fields 

thereafter.10 While most of Israel’s natural gas discoveries have yet to translate into proven gas reserves, in 

2013 Israel held a total of 9.48-tcf of proven and 30-tcf 

estimated reserves, positioning Israel ahead of all East 

Mediterranean countries in terms of gas reserves and 

resource prospectivity.11

Cypriot Gas.

Cyprus, bordering the geographical structure that 

since the early-2000s has been believed to hold substantial hydrocarbon potential, began its own offshore 

exploration program during that decade. With historically no hydrocarbon reserves, and as a geographical 

island state, Cyprus has had few energy options and 

has relied on oil imports for its entire energy needs.12

Rising prices of oil on international markets since 2002 

and the country’s growing financial difficulties since 

the late-2000s have given additional political impetus 

to the island’s own natural resource exploration program. Cypriot efforts were rewarded in 2011 with the 

discovery of significant hydrocarbon deposits in its 

most southeasterly economic zone in Block 12, with 

an estimated resource base of between 3- and 9-tcf.13

Cyprus has since tendered out four more offshore 

blocks, which have been signed up for by consortia 

led by European majors ENI and Total, and is planning for another licensing round in late-2014-15.14
6

Other East Mediterranean possibilities: Syria, 

Lebanon, and the Palestinian Territories.

Israel and Cyprus’s exploration successes sparked 

substantial interest in neighboring countries as well. 

Syria, the most experienced gas producer in the East 

Mediterranean, followed Israel’s initial discoveries in 

1998 with exploration efforts in its own offshore territories, though the priority given to onshore production reduced the pace at which these efforts were pursued. An exception to the East Mediterranean’s lack 

of historical oil and gas reserves, Syria already holds 

small, but essentially proven, oil and natural gas reserves of 2.5 oil barrels (bbl) and 8.5-tcf respectively, 

allowing Syria energy self-sufficiency for most of its 

modern history as well as moderately sized exports of 

oil to Turkey and Europe, currently disrupted due to 

civil war in the country.15

In May 2007, the Syrian government launched a 

first offshore bidding round, which ended with no 

rewards despite modest initial investor interest. This 

resulted from a combination of discouraging factors 

for international investors, including geopolitical and 

cost-benefit deterrents.16 A second bidding round 

in early-2012 had to be cancelled due to the gradual 

deterioration of domestic stability following the outbreak of civil protests and infighting as the political 

upheavals of the Arab Spring began to sweep into 

Syria in early-2011.17 Syria’s descent into civil war has 

since prevented any re-emergence of offshore exploration efforts, while the series of international sanctions 

that has followed various atrocities in the continuing 

conflict makes foreign investment in the sector nearly 

impossible at the time of this writing.18 Once the Syria 

conflict is resolved, prospects for Syrian offshore pro-
7

duction—provided commercial resources are found—

are high; Syria’s existing experience as a producer of 

both oil and gas should help the country develop any 

potential offshore resources relatively smoothly once 

the political situation allows for any new exploration 

efforts in its offshore territories.

Another interested neighbor with substantial geological prospects for offshore hydrocarbons is Lebanon. Lebanon’s exploration work commenced during 

the 2000s, followed (after much haggling over political posts) by the institutionalization of exploration licensing, with the creation of a Petroleum Authority in 

December 2012 and the launch of the country’s first 

bidding round in February 2013.19 Political stalemate 

in the absence of a parliament with decisionmaking 

powers has since delayed the finalization of the legal 

framework for an award of exploration and production licenses, and resolution appears remote at the 

time of this writing.20 The election of a new stable government in Lebanon able to resolve the current climate 

of political stalemate is likely to speed up the award 

of licenses and the exploration of Lebanon’s offshore 

territory—currently stated by the Lebanese government to hold potential for as much as another 30-tcf of 

natural gas as well as some 660 million barrels of oil.21

Similar to the remainder of the East Mediterranean, the Palestinian offshore territories near Gaza 

are believed to hold substantial hydrocarbon potential. Exploration in Palestinian waters was, in fact, 

already taking place during the 1990s, with two discoveries announced by an operating consortium led 

by BG from the United Kingdom in 2000 off the coast 

of Gaza. Control over Gaza’s offshore territories had 

been relinquished in 1999 by Israel to the Palestinian 

Authority (PA), rendering the development of these 
8

offshore discoveries in principle a Palestinian matter.22

A development plan for the 30 billion cubic meters 

(bcm) (1-tcf) Gaza Marine field stumbled, however, 

after obstruction by Israel over concerns regarding 

the flow of revenues to Palestinian stakeholders, leaving the development of these resources unaddressed 

until today.23

EAST MEDITERRANEAN HYDROCARBON 

RESOURCES AND REGIONAL 

CONFLICT POTENTIAL

The East Mediterranean has been a political flashpoint for much of its 20th- and 21st-century history. 

The region encompasses two of the world’s most intractable political conflicts, the Arab-Israeli conflict, 

fought out in several wars and in continued political 

conflict between Lebanon, Syria, Israel, and political 

opposition groups in both the Palestinian Territories 

and other neighboring countries, and the still unresolved Cyprus conflict, drawing in neighboring Turkey. Both Israel and Cyprus are key U.S. allies and 

pillars of U.S. foreign policy in the region: Israel, with 

its long history of close political ties with the United 

States, historically has stood at the heart of American 

efforts to secure regional peace; while Cyprus forms 

the most eastern part of Europe and is an important 

strategic location for both U.S. and British military interests. East Mediterranean gas may complicate relations still further in this already geopolitically fragile 

region, placing efforts to encourage regional cooperation at the center of any desirable policy response.
9

The Arab-Israeli Conflict.

Arab-Israeli relations have held the Levant region 

back from any fruitful economic cooperation for more 

than half a century, and are likely to continue to affect progress in the East Mediterranean’s offshore resource development. In fact, the presence of valuable 

natural resources in disputed territory may further 

feed the conflict. Continued conflict between Israelis 

and Palestinians over land and settling rights, and a 

series of wars fought between Israel and several of its 

Arab neighbors, have led to severely strained relations 

between the two sides. Military action between Israel 

and Gaza is ongoing, with the latest armed confrontation between Israel and Hamas since July 2014 serving as a painful reminder of the continued volatility of 

Israeli-Palestinian relations. Diplomatc relations between Israel on the one hand, and Lebanon and Syria 

on the other, remain nonexistent, with the two sides 

still de facto at war.

The potentially enormous economic value of hydrocarbon discoveries for the region’s current and prospective producers raises the stakes, and furthermore, 

provides an additional high-value target in any future 

armed conflict between the various sides.24 The Bank 

of Israel projects an overall positive effect of natural 

gas production on the country’s balance of payments 

of around $3.5 billion (bn) in 2014, and has announced 

plans to purchase foreign currency during 2015. The 

same projections suggest the natural gas industry may 

contribute around 1 percent to the gross domestic 

product (GDP) for 2013 (worth some $22 bn) and 0.7 

percent in 2014.25 Other East Mediterranean countries 

attach similar high values to the development of their 

yet-to-be-explored offshore hydrocarbon resources; 
10

some Lebanese government estimates have placed the 

value of Lebanon’s unconfirmed hydrocarbon riches 

at between U.S.$300 bn and U.S.$700 bn, around seven 

times the country’s current GDP, and a transformative factor for Lebanon’s economy, which has been in 

disarray for many years.26

In the past, natural gas development and trade 

have more than once fallen hostage to the region’s 

geopolitical difficulties. One of the most direct consequences of strained Israeli-Palestinian relations has 

been the lack of development of offshore gas resources 

discovered offshore Gaza in the late-1990s, despite the 

obvious economic benefits this development would 

have offered to the infant Palestinian economy.27 Israel has blocked any development of the resources 

since 2000 over concerns regarding the channeling of 

Palestinian gas revenues into alleged terror finance, 

supposedly funding armed attacks against the State 

of Israel. A 4-year development plan for Gaza’s offshore resources approved by the PA has since been 

discarded, while a breakdown in negotiations with 

Israel has driven lead developer BG and its partnering 

companies effectively to abandon Palestinian waters 

despite the resources’ prospectivity.28

Continuing regional tensions give rise to concern 

over both the security situation within Israel and the 

stability of Israeli borders, not only with the Palestinian Territories but with other, neighboring Arab countries. Following the fall of the Hosni Mubarak regime 

in Egypt and subsequent political turmoil, Egypt’s 

main gas pipeline to Israel and Jordan became subject 

to recurring rebel attacks targeting the Egyptian government and aimed at cutting gas export revenues.29

After more than a year of unstable Egyptian gas supplies, in April 2012 Israel faced the cancellation of 
11

its existing gas supply contract by the newly elected 

Muslim Brotherhood government, which deprived 

Israel of its primary source of natural gas imports.30 Israel’s domestic power sector was effectively saved by 

the country’s recent discoveries of its own resources, 

and the rapid start of production from the offshore 

Tamar field largely compensated for the natural gas 

deficit resulting from the cutoff of Egyptian supplies.31

But the evident vulnerability of Israel to disruption of 

energy supplies from its Arab neighbors undoubtedly 

has strengthened the political lobbies within Israel that 

oppose any export of Israeli hydrocarbon resources 

at all.32 These lobbies consider Israel’s hydrocarbon 

resources more of a sovereignty asset than a mere 

commercial commodity. 

Israel’s political isolation within the Arab world 

also affects the range of companies willing to invest 

there. This is of particular significance in the context 

of liquefied natural gas (LNG) technology, which will 

have to be acquired from the small range of international companies with the relevant know-how. The 

continued weight of Arab oil and gas producers as 

critically important partners for major international 

oil companies (IOCs) means that investment decisions involving Israel are especially sensitive. Fear of 

sanctions by Arab countries against IOCs and service 

companies operating in Israel may deter otherwise 

interested companies from entering the Israeli market. Similarly, Cyprus may experience similar consequences with respect to companies with significant 

exposure in Turkey, although the scope of these repercussions is likely to be smaller than in the case of 

Israel, given the relatively smaller number of international companies operating in Turkey as opposed to 

the Arab world as a whole.
12

The future development of offshore hydrocarbon 

resources in Israel and Lebanon’s sea waters could 

face still further complications, due to the two countries’ rival claims over both onshore and offshore 

maritime territory. Israel’s decision in early-2013 to 

grants exploration licenses for the Syrian-claimed Golan Heights spells potential for another armed conflict 

between the two parties should substantial hydrocarbon resources be discovered.33 While Syria’s current 

domestic situation may to a certain extent reduce the 

probability of any impeding conflict in the short term, 

a more immediate potential conflict area awaits farther along Israel’s maritime boundaries. Lebanese-Israeli borders remain only informally demarcated, and 

follow the 2000 Blue Line with unresolved border disputes both on land and offshore. Lebanese and Israeli 

claims over maritime territory overlap over an area of 

around 850 square kilometers (km)—not a large area 

by international standards, but one over which neither country appears willing to compromise.34 None 

of Israel’s confirmed discoveries so far fall into the 

disputed area, but Lebanon’s 2013 licensing round included bidding options for one out of three possible 

exploration blocks on the Lebanese side that crosses 

Israel’s claimed maritime boundary.35

Against a history of previous war and military intervention between Israel and Lebanon, mutual threats 

of using military force to protect the integrity of what 

each side considers its exclusive economic zone reach 

back to 2010, when the issue first emerged in both parties’ news media; Israeli Infrastructure Minister Uzi 

Landau (the Ministry of Infrastructure, remaining at 

the time of this writing the relevant ministry for Israel’s hydrocarbon developments), for instance, commented in June 2010:
13

We will not hesitate to use our force and strength to 

protect not only the rule of law but the international 

maritime law. . . . Whatever we find, they [Lebanon’s 

parliament and political circles] will have something 

to say. That’s because they’re not challenging our findings and so-called occupation of the sea. Our very existence here is a matter of occupation for them. These 

areas are within the economic waters of Israel.36

These remarks followed previous statements made 

by Lebanese Energy Minister Gebran Basil that Lebanon “will not allow Israel or any company working 

for Israeli interests to take any amount of our gas that 

is falling in our [exclusive economic] zone.”37

Meanwhile, the dispute also has delayed the delimitation of the Cypriot-Lebanese and Cypriot-Israeli 

exclusive economic maritime zones, despite Cypriot 

efforts to mediate in its own right between the two parties.38 In the case of an armed conflict between Israel 

and Lebanon, the security of the wider Levant region 

could once again be at stake, with a possible escalation 

of the conflict into neighboring Syria and the Palestinian Territories, as well as (with historical precedents) 

Jordan and Egypt. In combination, the pre-existing 

political problems in all of these countries—Syria destabilizing into de facto civil war, Egypt in the midst 

of political instability, the Palestinians and Lebanese 

lacking stable political cores—the potential for a new, 

escalating regional war is a threatening scenario indeed. Offshore hydrocarbon development plans along 

the East Mediterranean coast would immediately be 

impacted, as a high-profile target for military and terrorist attacks. Not least for this reason, both Israel and 

Lebanon face serious concerns over the desirability of 

potential future LNG liquefaction plants along their 
14

crowded and densely inhabited coastlines, as well as 

the vulnerability of as-yet-unbuilt gas pipelines across 

both countries and, possibly onward, to neighboring countries.39 Cyprus, too, could be affected, given 

the geographic proximity between Israel’s largest 

gas field, Leviathan—a potential site for Israeli gas 

production facilities—and Cyprus’s gas field where 

production is expected first, Block 12. Wider regional 

conflict could also affect Egypt’s significantly larger 

offshore gas production, further escalating the extent 

of potential disruptions caused by Israeli-Lebanese 

conflicts over gas resources.

The Cypriot Knot.

On the other side of the East Mediterranean shore, 

another decades-old conflict holds similar potential 

for re-escalation into armed conflict in case of unresolved rivaling claims over territorial waters and their 

potential hydrocarbon riches. Cyprus has been the site 

of confrontation among different interests for most of 

its modern history. Greek and Turkish Cypriots continue to inhabit the island state divided into the Greekdominated South and the Turkish-dominated North. 

The Republic of Cyprus, which on paper comprises 

the whole island, is internationally recognized and a 

member of the EU, while the Turkish communities in 

the North of the island declare themselves a separate 

state, recognized only by Turkey.40 This division of the 

island state has led to rivaling claims by both groups 

over land and maritime territory, and now over the 

allocation of potential export revenues from offshore 

gas reserves. While the Government of the Republic 

of Cyprus has assured that Cyprus’s gas-export revenues would benefit all Cypriots once a comprehen-
15

sive peace agreement has been settled, the absence of 

any such agreement, or indeed, of prospects for the 

conclusion of a comprehensive peace any time in the 

near future, raise questions over how Cyprus’s two 

communities will accommodate the expected inflow 

of revenues once Cypriot gas leaves Cyprus’s planned 

export facilities. This is also pertinent in view of previous propositions to use Cyprus’s hydrocarbon 

wealth as collateral for current and future national 

borrowing.41

Turkish-Cypriot claims have been supported on 

the political level by Cyprus’s key ally, Turkey, which 

has warned Nicosia to suspend development of any 

offshore reserves until the Cypriot question is eventually settled; Turkey, in fact, called the start of Cypriot 

exploration activities a “provocative and irresponsible” act42 and stated that it would do “whatever necessary” to defend Turkish and Turkish-Cypriot rights.43

A further statement followed issuance of Cyprus’s 

second offshore tender round in February 2012 that 

Turkey would “take all necessary measures to protect its rights and interests in the maritime areas falling within its continental shelf.”44 International Crisis 

Group observers report complaints by Greek Cypriots 

over Turkish harassment inside Cyprus’s maritime 

zone, where Turkey has reportedly carried out military exercises, approaching within five nautical miles 

of installations—described by Greek-Cypriot observers as “gunboat diplomacy.”45

In the absence of a comprehensive settlement, Turkey and the Turkish-Cypriot community signed an 

agreement delineating their continental shelf in September 2011, assigning exploration licenses for seven 

offshore blocks, six of them in Greek-Cypriot areas 

(Blocks 1, 2, 3, 8, 9, and 13).46 The Turkish state oil 
16

company Türkiye Petrolleri Anonim Ortaklığı (TPAO) 

reportedly has since begun to explore for hydrocarbon 

resources inside the Turkish-Cypriot-claimed territories,47 despite (at the time of this writing) no apparent 

confrontation over exploration efforts with consortia 

operating in Nicosia’s tendered-out license blocks. Potential for future conflict over offshore territories also 

results from direct Turkish maritime claims, which 

overlap with some of Nicosia’s demarcated offshore 

blocks in the southwest. The four blocks in question 

formed part of the package of blocks on offer for licensing in the country’s last licensing round in 2012, but, 

despite reporting bids, ended up not being licensed 

out.48 It is more likely, however, that Cyprus will end 

up tendering out the respective blocks in question at 

a future bidding round, raising a parallel question to 

the Israeli-Lebanese water dispute as to how the different parties involved would react to a substantial 

hydrocarbon discovery in the disputed blocks.

Any suspension of the development of Cyprus’s 

offshore resources would likely alarm not only the 

Cypriot government, but many of Cyprus’s main political and economic allies as well. Cyprus, bailed out 

by an International Monetary Fund (IMF) and EUbacked rescue loan of $10 bn in March 2013 but still on 

the edge of economic bankruptcy, has already begun 

to build part of its future economic recovery plans on 

the growth of an indigenous natural gas industry and 

on the expected revenue from the export of natural 

gas from its offshore territories.49 Politically caused 

delays in this development would likely exacerbate 

the normal delays resulting from potentially disappointing geologic and field performance (as has been 

the case following Cyprus’s second appraisal drilling 

in October 2013).50 This would further complicate the 

country’s already precarious financial situation. 
17

An armed conflict between the two Cypriot communities, possibly involving Turkey, would place yet 

another military conflict at the periphery of the EU, 

threatening the stability of the EU’s most eastern border and its political and commercial relations with 

Turkey. Continued deadlock over the Cypriot question, contributed to by disputes over offshore hydrocarbon reserves, would also continue to hamper the 

ability of North Atlantic Treaty Organization (NATO) 

partners to cooperate more closely with Cyprus, given NATO member Turkey’s continued resistance to 

strategic NATO cooperation. Cyprus’s geostrategic 

location between West Asia and Eurasia, on the other 

hand, renders Cyprus a highly desirable NATO partner, as well as a strategic partner for the United States, 

which maintains strategically important military facilities there. Escalating conflict between Cyprus and 

Turkey may also further feed into existing political 

instabilities across the East and Northeastern Mediterranean, including Turkey itself, which witnessed 

political turmoil in early-2013 and borders the already 

unstable Syria. A crescent of disintegration along the 

East Mediterranean coastline is indeed a worst-case 

scenario both for the region itself, and for its NATO 

partners.51

The East Mediterranean and the Arab Spring.

The outbreak of political protest in North Africa 

and its gradual spread across the Arab world since late2010, popularly known as the Arab Spring, affected the 

East Mediterranean as well. Syria has seen a dramatic 

deterioration of its domestic political situation since 

early-2011, gradually falling into civil war, which has 

led to several tens of thousands of human casualties 
18

and more than 2.3 million recorded refugees.52 A series 

of alleged chemical weapons attacks against Syrian civilians in the suburbs of Damascus in September 2013 

led to weeks of debate around a possible international 

or U.S. military intervention; this debate followed U.S. 

President Barack Obama’s previous declarations that 

chemical weapons used against civilians in Syria were 

a “red line” for the United States that would prompt a 

reconsideration of the U.S. Government’s opposition 

to military intervention.53 Syria’s civil war has led to 

the cancellation for the time being of all Syrian plans 

to further explore and develop its offshore Mediterranean oil and gas resources, meaning new discoveries 

and production capacity from Syria are now expected 

to be years away, and subject to the stabilization of 

domestic politics.

Lebanon, into which a large share of Syrian refugees have fled since 2011, appears on the verge of being drawn into the conflict as well, as evident from the 

resurgence of shooting, assassinations, and sectarian 

violence. Having been largely spared Arab Springrelated political protests, Lebanon’s domestic political 

life has nevertheless been in deadlock as a result of 

familiar Lebanese political factors, in addition to the 

growing threat of resurfacing large-scale sectarian 

violence.54 Hence, it comes as little surprise that Lebanese plans to explore and tender out its first offshore 

blocks have been delayed by more than a year. This 

was precipitated by the inability of the country’s policymaking circles to agree on the sectarian composition of the Petroleum Administration, a body required 

by the country’s petroleum law for the exploration of 

Lebanese waters to begin.55 With no government in 

place throughout most of 2013, further delays are now 

unavoidable until a new government is able to put 
19

into place the decrees required to issue tenders after 

the country’s first bidding round in early-2013.56

Lebanon and Syria demonstrate that progress in 

hydrocarbon development in the East Mediterranean 

may in reality be halted by domestic politics more than 

by—as has been widely speculated— cross-border political conflicts. In the case of continued political deadlock in the two countries, prospects for development 

of East Mediterranean gas resources other than in Cyprus and Israel look unlikely in the near term, promising little positive economic impact other than in those 

two states. The continuing political destabilization of 

Lebanon and Syria is highly undesirable, given the 

impetus of war and political stalemate in a densely 

populated but heavily compromised region. Instability in Syria and Lebanon also affects regional risk ratings and the attractiveness of foreign investment into 

regional offshore developments, and thus dilutes any 

prospect of more comprehensive regional cooperation 

in both the political and economic spheres.

By contrast, the most recent outbreak of military 

confrontation in July between the Palestinian organization Hamas and Israel in Gaza has so far had no 

direct impact on East Mediterranean gas. On the one 

hand, this is because Palestinian gas is not yet being 

developed, thereby precluding any impact of the conflict on Palestinian gas; on the other, Israel’s gas fields 

are relatively remote from the conflict point, with 

Hamas rockets being directed at Israeli land rather 

than at sea. Once Israeli gas flows into Gaza’s nowdestroyed sole power plant, theoretically little incentive exists for Palestinian paramilitary groups to bomb 

their own gas supplies. This contrasts with the already 

high impact of Egyptian political instability on the 

likelihood of Israeli gas flowing across the Sinai Pen-
20

insula, which is more likely to continue to affect the 

viability of any onshore pipeline trade option between 

Israel and Egypt.

NATURAL GAS, REGIONAL COOPERATION, 

AND THE ROLE OF THE UNITED STATES 

The recent East Mediterranean discoveries raise a 

whole range of commercial and security-related questions: What will the long-term strategy be to monetize 

the significant value offered by the region’s commercial offshore gas and possibly oil resources? Will regional political rivalries, or indeed, domestic political 

stalemate, hinder the development of these resources 

over the medium term? Will the East Mediterranean’s 

newly discovered hydrocarbon wealth indeed help 

the region overcome some of its historical divisions, or 

will those same divisions be further reinforced by the 

presence of what looks at present like a significant potential source of new regional income? How will U.S. 

strategy in the region feed into the direction in which 

these various factors will play? The possible addition 

of yet greater offshore hydrocarbon resources—both 

of natural gas and of oil—alongside the East Mediterranean shores, which also include Syria and Lebanon, 

will likely add further complexity to the region’s already rapidly changing energy security architecture 

and the direction of future regional energy trade. We 

examine some of the (currently) most likely regional 

energy development options, followed by thoughts 

about the future U.S. role within this newly emerging regional context. It should be noted that the reality is likely to be a combination of different scenarios, 

as exporter Israel, but potentially also other future 

East Mediterranean gas producers, will seek security 

through diversity of export markets.
21

Scenario 1: Cooperation through regional LNG.

Global trade in LNG has been growing rapidly 

since the 1990s and, for many new gas producers, has 

become the method of choice to market their natural 

gas resources. In the East Mediterranean, too, LNG 

may capture part of the export volume of natural gas 

produced, with Cypriot plans to build an LNG liquefaction plant on the southeastern coast of the island, 

as well as various LNG-related plans currently being 

discussed by Israel. The outlook of the East Mediterranean as a new LNG-exporting region is hence an 

interesting prospect. 

LNG offers many logistical and—under the right 

conditions—some commercial advantages over traditional pipeline exports. LNG is flexible and can be exported across regions, eliminating the regional nature 

of pipeline-dependent natural gas trade and thereby 

allowing new gas exporters to become players in what 

is slowly becoming an increasingly global market for 

natural gas. Global exports, even if (currently) small 

in total volume, as is the case for the East Mediterranean, hold many geostrategic benefits in addition to 

the commercial value of reaching new, and potentially 

premium, markets for gas; it follows that the ability 

of previously import-dependent countries such as Cyprus, Israel, and Lebanon to supply LNG to Europe, 

Latin America, or even Asia appears politically attractive both on a domestic and regional level. LNG markets such as Asia-Pacific further promise prospects of 

substantially higher prices than pipeline gas is likely 

to fetch in the immediate region or in Europe, despite 

the need for care over forward-looking price assumptions at a time (2020-30), when pricing structures and 
22

price levels are likely to differ significantly from those 

of today.57 LNG exports also invite the option for gas 

producers to engage in the increasingly lucrative 

spot trade of LNG in addition to long-term contracts, 

once again adding trade flexibility and potentially 

raising profits. 

The East Mediterranean producers of gas—Cyprus 

and Israel in particular—also hold very specific reasons to consider LNG over and above pipeline gas. 

Geographically, Cyprus in particular remains an island state with no overland options for pipeline infrastructure, adding to the cost of pipeline exports via 

subsea pipelines. The closest subsea route for Cypriot 

pipeline exports would lead via Turkey, a commercially sensible option but one that is highly unlikely 

on political grounds (at the time of this writing), given 

the continually unresolved Cyprus question and Turkey’s consequent reluctance to trade with the Republic 

of Cyprus.58 An alternative pipeline route to Greece, 

while politically more desirable, involves a significant 

geographical diversion of a Cypriot pipeline route, 

more than tripling the distance to land, while the eventual market price paid by Greece—like Cyprus still at 

the verge of financial collapse—is unlikely to be anywhere near enough to justify the enormous additional 

cost of a subsea pipeline connecting the two remotest 

parts of Europe. Other pipeline routes could connect 

Cyprus via subsea pipelines to Israel or Egypt—both 

natural gas producers in their own right—but both 

displaying a high degree of significant political problems that are unlikely to render them desirable transit 

locations for Cypriot gas in the first place.

Israel itself, being a political more than a geographical island inside the Levant, faces a history of complicated political relations with its Arab neighbors; it has 
23

been at war with all of them at different points of time 

since its establishment in 1948. Given the continued 

de facto war with neighbors Syria and Lebanon, any 

gas trade with Israel’s northern neighbors is unlikely 

in the near future; nor is it possible for Israel to export natural gas via existing pipeline infrastructure 

onward to Turkey using the land route via Lebanon 

and/or Syria. Relations with southern neighbors Jordan and Egypt and the Palestinians have, by contrast, 

been more varied and would, in principle, allow for 

pipeline trade. However, those elements inside Israel 

who would oppose natural gas trade with Arab neighbors on political grounds, in addition to uncertainty 

over the viability of these trade routes, render LNG 

for Israel, as much as for Cyprus, a regionally independent gas-export option with significant commercial potential under the right circumstances.59

Individual LNG or a Regional LNG Hub?

Cyprus has already embraced LNG exports as its 

main export strategy for the early-2020s—not least because of significant interest by operating companies 

Noble and its partners in monetizing Cypriot gas in 

the most commercially straightforward way.60 Disappointing appraisal drilling results in October 2013 

have for the time being cast doubts over the commercial viability of an LNG terminal in Cyprus as long 

as no additional resources are found offshore Cyprus 

or brought in from neighboring countries sharing a 

potential LNG terminal, such as Israel. Potential cooperation between Cyprus and Israel over shared LNG 

facilities at Vassilikos has been discussed in the media 

and by political and commercial interest groups. A regional LNG hub on Cyprus would solve two parallel 
24

problems. Cyprus could attract additional funding and 

investment, making use of economies of scale, while 

raising the commercial viability of LNG exports under the current time plan in case of less-than-expected 

eventual production rates for Block 12, the only block 

currently far enough explored to start production by 

producer Noble’s ambitious time schedule. This argument has gained additional urgency following Noble’s 

sobering results from its second appraisal drilling in 

October 2013, which some observers have interpreted 

as throwing back Cypriot LNG export plans by up to 

2 years if no additional gas can be sourced.61

Israel, on the other hand, would similarly benefit in 

financial terms from the arrangement, saving investment costs for a new greenfield project inside Israeli 

territory, while solving the politically controversial 

question of where to place an Israeli LNG export terminal along the country’s crowded and terror-prone 

coastline. Similar factors affect Lebanon’s gas export 

plans, since if Lebanon’s own potential offshore gas 

production materializes in the coming years, Lebanon 

too could be a potential partner for a Cyprus-based 

regional LNG hub. Lebanese and Israeli cooperation 

with Cyprus over LNG exports will obviously be 

mutually exclusive—implying a head start for Israel, 

whose gas development program is significantly more 

advanced than that of Lebanon—while a potential 

Israeli alteration of plans to reserve its gas production for domestic supply or regional pipeline trade 

could open a window of opportunity for Lebanon at a 

later stage.

Opponents to an Israeli-Cypriot entente, primarily 

within Israel, fear Israeli dependence on a third country for Israeli gas exports, which may expose Israel 

to the use of its gas export facilities as political lever-
25

age, in addition to reduced tax revenues for the Israeli 

state.62 Shared Cypriot-Israeli LNG facilities also hold 

the potential for diplomatic interference with Israel’s 

parallel strategy of improving political and commercial relations with neighboring Turkey, with discussions over Israeli pipeline exports to Turkey ongoing 

in parallel to talks with Cyprus. In the case of exacerbation of armed conflict within Cyprus, Israeli gas 

exports, moreover, might be held hostage alongside 

Cypriot gas, a prospect that will cause unease in Israeli policy circles despite its relative unlikelihood 

at present.

The expected volume of East Mediterranean LNG 

exports under a best-case scenario throughout the 

2020s should be seen as moderate in size. Cyprus’s 

initial plans were for initially one LNG train of around 

5-10 million metric tons per annum in the early-2020s, 

possibly to be added to in subsequent years by one 

or two more trains, although current reserve corrections seem to disallow this target. Israel, if and when 

it decides to export LNG, may add an additional one 

to two trains. Even in the currently unclear case of 

another, possibly Lebanese, LNG train to come on 

stream by the late-2020s, this volume is no strategic 

competitor to the new, large LNG exporters, Australia, East Africa, and, possibly, the United States, 

over key premium markets in Asia.63 Hence, the overwhelming commercial success of Cypriot LNG is by 

no means guaranteed, despite obvious economic potential in principle. Floating LNG (FLNG), too, could 

be an option, in particular as it would offer an answer 

to smaller 3-5-tcf fields such as Block 12 and Tamar, 

in addition to its application on larger fields such as 

Leviathan. The technology for this would need to be 

brought in by an outside company, since experience in 
26

FLNG, a relatively new technology option,64 remains 

limited to a handful of international companies. While 

Woodside, for instance, has been strongly advocating 

FLNG in Israel, the question is which company would 

supply the technology, given the possible negative 

implications for any company with Arab country exposure. Cyprus may find it easier to attract a range of 

experienced companies, but the Cypriot government’s 

past focus on onshore LNG renders this option, so far, 

one with no systematic policy focus in Cyprus.

Scenario 2: Regional Pipeline Trade.

Looking beyond LNG, there are many important 

reasons to consider the potential role East Mediterranean gas could play in regional exports. The Middle 

East and North Africa are among the world’s fastestgrowing regional demand centers for natural gas, and 

despite significant gas reserves there is an increasing 

shortfall of gas production to satisfy domestic market 

demand. Energy Information Agency (EIA) projections suggest total Middle Eastern gas demand will 

almost double until 2040, rendering the Middle East 

second only to Asia-Pacific in the rate of its market 

growth for several decades to come (see Figures 1 and 

2). Turkey, another rapidly growing energy market 

bordering the East Mediterranean, is also a potential 

market for East Mediterranean gas, as well, because 

of its strategic geographical location. Turkey is an important future transit hub for pipeline gas from West 

and Central Asia to Europe, as part of European efforts to diversify their gas supplies away from Russia 

via the Southern Corridor.65
27

Note: The Middle East includes Bahrain, Iran, Iraq, Israel, Jordan, 

Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Syria, the United 

Arab Emirates (UAE), and Yemen.

Source: EIA, Washington, DC, 2014.

Figure 1. Projected Natural Gas Demand in the

Middle East (bcf), 2010-40.

Note: The Middle East includes Bahrain, Iran, Iraq, Israel, Jordan, 

Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Syria, the UAE, 

and Yemen.

Source: EIA (2014)

Figure 2. Projected Natural Gas Demand Growth in 

the Middle East (Percentage), 2010-40.
28

An Arab-Israeli “Peace Pipeline”?

Part of Israel’s options to market and monetize its 

natural gas lie in its direct regional neighborhood, and 

a series of initial agreements with Israel’s Arab neighbors since early-2014 indicates that Israel is indeed 

positively inclined toward these options. The Palestinian Territories, economically marginalized and with 

no energy resources beyond the so-far-undeveloped 

offshore Gaza Marine, proved indeed to be the first 

Israeli gas customers in January 2014. After several 

months of private negotiations, Palestine Power Generation Co. signed an agreement to purchase around 

4.75-bcm of natural gas over a 20-year period, worth 

some $1.2 bn,66 an initial agreement followed in subsequent months by similar agreements with Union 

Fenosa and BG Group in Egypt over the potential supply of some 1.75-tcf of Israeli gas to Egyptian markets, 

and up to 3.75-tcf for export as LNG through Egypt’s 

since late-2013 largely idle liquefaction plants.67 The 

Israeli-Palestinian entente came amidst reintensified 

efforts by international and U.S. diplomats to forge a 

greater Middle East peace agreement, contrasting with 

years of unsuccessful attempts to gain tangible results 

from broader political negotiations. An International 

Business Times commentator pointedly contrasted 

the decades of fruitless effort on political settlement 

with what a few months of negotiations between commercial companies on both sides have been able to 

achieve.68

While the volume of gas and the value of the trade 

agreement are not large by the standards of potential 

Israeli or Cypriot gas exports via LNG into international markets, or even by pipeline into larger regional 
29

energy markets, the Israeli-Palestinian gas trade agreement symbolizes the political and commercial viability of regional pipeline exports, including from Israel. 

While politically appealing from an Israeli perspective 

(Palestinian dependence on Israeli gas for the security 

of electricity supplied to Palestinian homes ideally reduces the incentives for Palestinian politicians to forge 

a new full-scale military conflict with Israel), the trade 

deal is also economically beneficial for both sides. On 

the one hand, Israel earns export revenues involving 

only a small volume of Israeli gas (in contrast with 

the high-volume, long-term contracts associated, for 

instance, with LNG exports that are opposed in Israel 

on political grounds). The Palestinian Authority and 

Palestine Power pay significantly less for Israeli gas 

than they would for the alternative of high-cost international oil imports, which, so far, are the only fuel 

alternative to natural gas for the Palestinians in view 

of the lack of gas supplies anywhere in their regional 

vicinity.69

This mutually beneficial trade arrangement between Israelis and Palestinians could also be extendable into Israel’s other Arab neighborhoods; both 

Jordan and Egypt are growing gas markets, short of 

natural gas supplies—in the case of Egypt, this is also 

due to lacking domestic investment, exacerbated by 

more than 3 years of political turmoil following the 

Arab Spring—and economically overburdened by existing government spending. Alternative fuel imports 

from international markets are high-cost options, with 

costs for oil imports having more than doubled over 

the 2000s as a result of rising oil prices and Jordan and 

Egypt’s continuingly high reliance on oil-fired power 

generation.70 Jordan signed a gas trading agreement 

with Israel in February 2014 worth $500 million, with 
30

the option to turn Israel into Jordan’s main supplier 

over the coming years.71 Commercially speaking, 

this gas trading agreement is likely to be the lowestcost energy supply option available to Jordan over 

the coming years—a truth likely applicable to Egypt 

as well.

While Jordan relies on international loans, Egypt 

currently survives on financial and in-kind aid from 

several Gulf Cooperation Council countries, primarily Saudi Arabia, Qatar, the UAE, and Kuwait.72 For 

Egypt, too, any medium- to long-term energy supply 

option will rest on a low-cost fuel supply, with Israel ironically offering the most likely competitively 

priced gas option. In addition to the cost of fuel, the 

largely pre-existing pipeline infrastructure connecting 

the three countries—because of Egypt’s historical gas 

exports to both Israel and Jordan—implies that capital 

costs for an initial infrastructure investment would be 

low and, unlike in the case of Israeli LNG, would not 

require 20-year contracts to finance the entire initial 

capital cost.73 (See Figures 3 and 4.)

Source: EIA, Washington, DC, 2014.

Figure 3. Egypt’s Narrowing Domestic Gas Balance 

(bcf per annum).
31

Source: EIA, Washington, DC, 2013, with data from BP and 

Cedigaz.

Figure 4. Egypt’s Pipeline and LNG Exports (bcf/a).

Both Jordan and Egypt also offer additional benefits to the Israeli side, which, in turn, may positively 

influence the price of Israeli gas supplied to these markets. Egypt already has two LNG liquefaction plants, 

both of which operate below capacity because of 

Egypt’s domestic gas shortage, with long-term supply 

contracts in principle tying Egyptian gas into export 

markets.74 Israeli gas could supply these LNG facilities, 

using existing infrastructure rather than constructing 

new facilities in the East Mediterranean, and capturing the LNG market share—possibly via gas swaps 

with Egypt—thereby solving both Egypt’s problem of 

fulfilling supply contract conditions, while offering Israel access to LNG markets. Similarly, Jordan has been 

considering turning its Red Sea port of Aqaba into an 

LNG hub, and could host a yet to-be-built LNG facility that could export Israeli, or possibly later, Lebanese 
32

LNG, with an eye on premium Asian markets.75 In this 

context, Jordan may prove to be an even more attractive option than Egypt, given that Suez Canal fees can 

be avoided while reaching Asian markets. Both Jordan and Egypt could benefit from the resultant transit 

fees, while the mutually beneficial trade arrangement 

between them and Israel would likely forge beneficial 

political stability across gas-transiting borders; Jordan 

would also see additional infrastructure investment, 

providing a new technology branch, foreign investment and new employment options. The resulting 

pipeline trade scenario would resemble only at first 

sight a regional “peace pipeline” approach; in reality, it could be a fully functioning and commercially 

very beneficial arrangement for both the Arab and the 

Israeli sides.

The most important stumbling block to such a regional solution will undoubtedly be politics, on both 

sides. Israeli politicians, some of whom remain opposed to any Israeli gas exports, have dominated public debates and tried to block the Israeli government’s 

decision to allow gas exports rather than reserve Israel’s newly found hydrocarbon wealth for the domestic market. On the Jordanian-Egyptian sides, many 

political groups and a majority of the population will 

be opposed to natural gas trade on political grounds. 

The Palestinian cause, including continuingly unresolved questions such as Palestinian statehood and 

land claims, Jewish settlements, and the status of Jerusalem and of several million Palestinian refugees (1.9 

million of which have been registered by the United 

Nations in Jordan alone)76 resonates with a vast part 

of these countries’ populations and renders the idea 

of Jordanian and Egyptian gas payments contributing to Israel’s security budget deeply uncomfortable. 
33

Egypt’s natural gas trade deal under the Mubarak regime during the 2000s sparked political protest and 

heated debate, with some civil society institutions taking the administration to court to stop Egyptian gas 

exports to Israel.77 Moreover, Jordan’s King Abdallah 

II and the ruling Hashemite family rely on political 

support from East Bank tribal families, the loss of 

whose support over a Jordanian-Israeli gas trade deal 

would come at an unacceptable political cost.78 Also, 

trade with Israel in natural gas would render its Arab 

trade partners—Jordan and Egypt, to very different 

extents—dependent on Israeli gas deliveries, providing Israel with a powerful strategic ransom in the case 

of any new outbreak of military confrontation.

REGIONAL PIPELINE GAS INTO TURKEY 

AND EUROPE

Turkey is another potentially significant export 

partner for Israel, and, in the much-longer term, once 

the Cypriot question is resolved, an export partner for 

Cyprus. Turkey is a rapidly growing demand market, 

the largest in the wider region, with some of the highest regional domestic gas prices. This also renders the 

Turkish market attractive for supply projects involving an initially higher capital cost, such as for longdistance and subsea pipelines. For Cyprus itself, a direct subsea pipeline to Turkey would entail the lowest 

capital costs of any export option, although politics 

are unlikely to render this option palatable at the time 

of this writing. Even from Israel, a subsea pipeline link 

to Turkey has been assessed as logistically and commercially feasible, and would be for Israel the only option to reach Turkey by pipeline while the land route 

via Lebanon and Syria remains closed. (See Figure 5.) 
34

and 6.)

Source: Authors, based on EIA, Washington, DC, 2013.

Figure 5. Natural Gas Consumption, 

5-yr Compound Average Annual Growth, 2008-12, 

Selected Countries and Regions.

Source: EIA, Washington, DC, 2013.

Figure 6. Turkey’s Growing Gas Market, bcf.
35

Strategically, Turkey offers further attractions. 

Turkish interests in promoting itself as a new gas 

transit hub for European gas would also offer East 

Mediterranean gas exporters the long-term prospect 

of 1 day exporting gas to Europe, albeit in small volumes.79 The commercial value of East Mediterranean 

gas exports to Europe may be moderate, and would 

still entail more questions from the producers’ sides 

regarding the price Europe is likely to pay for new gas 

contracts in view of the changing European gas pricing environment. However, the strategic value of East 

Mediterranean gas exports into Europe may be high, 

given European interests in diversifying sources of the 

gas supply away from traditional Russian supplies 

are also important political considerations. The 2014 

Ukraine crisis, which (at the time of this writing) has 

led to the imposition of U.S. and European sanctions 

against Russia in the aftermath of the alleged shooting 

down of Malaysia Airlines flight MH17 in July 2014 

over Ukrainian territory, has arguably added further 

strategic value to any future alternative gas supply for 

Southeastern Europe. Cypriot gas sold to Turkey, and 

potentially onward to Europe, could also constitute an 

important basis for renewed peace talks between the 

two sides, providing an important commercial carrot 

for the pursuit of specific outcomes of any negotiations between the two sides. Similarly, Israeli gas sold 

to Turkey via the Cypriot exclusive economic zone 

could benefit Cyprus by way of parallel gas supply 

and transit fees. It could also open the Turkish route, 

albeit initially only for Israeli gas, on the Cypriot side, 

while providing Turkey with a gas corridor that could 

be further opened up to Cypriot gas in the future if 

political tensions ease.80
36

Israeli-Turkish relations have undergone various 

phases, having been troubled by ideological differences as well as the 2010 killing of Turkish Palestine 

activists on a Turkish ship off Israel’s coasts. Both 

Turkey and Israel could nevertheless have considerable interest in gas trade, because of the commercial 

attractiveness of the option. Turkey also has an intrinsic interest in gas supply options other than dominant 

supplier Russia, while its main alternative, Iran, has 

been under sanctions and appears an unlikely incremental supplier for Turkey’s fast-rising gas demand.81

Other supply options for Turkey are complicated, for 

apart from the cost-intensive option of LNG, other 

regional supplies from Iraq and the Caspian—politically charged in their own right—have not been forthcoming. Former U.S. Ambassador Matt Bryza sees a 

possible advantageous entente:

A pipeline connecting Leviathan to the Turkish market, the most commercially efficient export option, 

could help resurrect a strategic partnership dedicated 

to regional prosperity and stability between Israel and 

Turkey.82

The Israeli-Turkish option, because of its comparably lesser political hurdle, is also the most probable 

medium-term option for East Mediterranean gas exports into Turkey. Besides political will on both sides, 

one of the key obstacles to overcome in order to enable 

both countries to trade with each other is undoubtedly a solution to the two countries’ conflict over the 

Gaza flotilla incident, at which nine political activists 

supporting the political cause of the Palestinians in 

Gaza—including eight Turkish citizens—were killed 

by Israeli soldiers during a military raid.83 After the 

Turkish downgrading of relations to second secre-
37

tary level and cooling bilateral relations thereafter, a 

telephone conversation in March 2013 between Turkish Prime Minister Recep Tayyip Erdogan and Israeli 

Prime Minister Benjamin Netanyahu—during which 

Netanyahu apologized for operational mistakes by 

Israel during the flotilla incident—has since raised 

hopes for a rapprochement of the two sides.84 A likely 

next step will involve financial compensation for the 

families of those killed in the incident, after which gas 

trade relations between Israel and Turkey may well 

be a politically palatable option. The role of international intermediaries such as the United States could 

well consist of political support for this reconciliation 

process, providing forums and overall policy support 

where required. 

The Cypriot-Turkish case is significantly more 

complicated, and looks difficult in the absence of 

a more comprehensive peace arrangement and the 

distribution of resource revenues from the export of 

Cypriot gas exports among all Cypriot citizens, including in the North. International intermediation 

and diplomatic efforts once more provide an essential 

background to progress in the matter. So does American mediation and policy support alongside the EU in 

facilitating talks and trust-building mechanisms that 

would render Cypriot-Turkish gas trade a desirable 

long-term outcome of fruitful negotiation.

U.S. Diplomatic and Security Cooperation. 

U.S. diplomatic and military support has a pivotal 

role to play in the East Mediterranean’s complex geopolitical landscape, and its importance will only grow 

as the value of the natural resources at stake increases. 

On the Western part of the East Mediterranean, both 
38

Cyprus and Turkey are important partners for U.S. 

interests in different regions. Cyprus is a NATO partner and a long-term strategic ally of Europe and the 

United States in the East Mediterranean. It is wedged 

between Europe, Eurasia, and the Middle East and, 

as such, is a perfect location for regionally based intelligence and defense systems. Turkey is a NATO 

partner and a key location for the stationing of a U.S. 

early-warning-radar system as part of the NATO missile defense system for Europe. It is an important U.S. 

ally with an interest in regional democratic transition 

and stability, and is a political buffer between Europe 

on the one hand, and unstable neighboring countries 

Syria, Iraq, and Iran on the other.85 Making regional 

gas developments and trade an economic pillar in U.S. 

foreign engagement in the region could be a highly 

beneficial way of concentrating resources in a region 

that may yet listen to economic incentives after many 

decades of unsuccessful, politically motivated rounds 

of negotiation.

Diplomatically, the U.S. role could entail a whole 

range of areas for mediation, and for contributing to 

the realization of different East Mediterranean project 

options. Within the Cypriot-Turkish knot, as well as on 

the side of Israeli-Turkish relations, ample scope exists 

for the intensification of diplomatic efforts that would 

help Cyprus develop its offshore resources peacefully 

and without ensuing conflict with mainland Turkey. 

In this context, the current diplomatic crisis between 

Russia, the EU, and the United States could serve as 

an important basis for future efforts by American and 

European partners to foster diplomatic talks between 

the two Cypriot communities on the one hand, and 

Turkey on the other, to create an environment more 

conductive to the export of East Mediterranean gas to 
39

Europe through the Turkish route. Furthermore, and 

in the case of LNG, a Cypriot LNG terminal as currently planned does not require a benevolent Turkish 

stance toward Cypriot exports, nor a comprehensive 

peace agreement between the Cypriot communities. 

Nevertheless, stable relationships would help remove 

barriers that could later on threaten Vassilikos LNG, 

such as the Turkish-Cypriot contestation of Cypriot 

exploration and production efforts, and the possible 

exacerbation of maritime border disagreements into 

armed violence. The ideal inroads to prevent such 

scenarios would likely involve:

1. A rapprochement between the Greek- and Turkish-Cypriot communities, supporting LNG export 

plans from Vassilikos and the secure development of 

hydrocarbon resources from tendered-out exploration 

blocks;

2. A Turkish-Cypriot rapprochement that enables 

the above; and,

3. A Turkish-Israeli détente that helps the two 

countries overcome mutual animosities.

International efforts to promote a comprehensive 

settlement of the Cypriot question have been ongoing 

for many decades. Natural gas discoveries could facilitate the process. However, the vital interests of both 

European and U.S. partners of Cyprus in the resolution of the issue render continuous, intensified efforts 

in this direction ever more important. Cyprus’s natural gas development offers a powerful carrot for new 

and intensified regional talks and the introduction of a 

new regional roadmap to peace and cooperation over 

these new natural resources. The United States, as an 

intermediary, is of prime importance in this regard. A 

diplomatic ally both of Europe and of the Republic of 
40

Cyprus, it is also a NATO partner of Turkey, thereby 

enjoying mutual respect and relations with both political sides. Meanwhile, American diplomatic strength 

could prove critical in engaging all sides constructively in both open- and closed-door meetings. 

On the Middle Eastern side, any escalation of territorial disputes over offshore hydrocarbon resources 

between Israel and Lebanon in particular would call 

for U.S. support, and before that, diplomatic efforts to 

reduce the risk of any outbreak of conflict. U.S.-Israeli 

economic, diplomatic, and defense ties have been close 

for many decades.86 It was partly as a result of U.S. diplomatic efforts that Israel and the Palestinian Liberation Organization returned to the negotiation table for 

direct talks over a comprehensive peace agreement, 

an effort that has brought the United States much recognition throughout the Arab world. The agreement 

between Israelis and Palestinians to trade in natural 

gas has been one detail within these negotiations. 

However, this agreement underlines the considerable 

potential that well-directed U.S. diplomatic efforts 

can achieve, particularly after several years of stalled 

relations among all three sides. There are numerous 

precedents for the joint exploration and exploitation 

of disputed territories for natural resources, which 

could be considered for similar cases in the East Mediterranean, once more raising the potential benefits of 

U.S. intermediation.87

U.S. interests also involve the peaceful exploitation of the Levant’s hydrocarbon wealth for reasons 

beyond Israel’s sake; both neighboring Syria and 

Lebanon remain key players on the region’s geopolitical map, underlying U.S. political calculations 

vis-à-vis neighboring Iran.88 Economic and political 

chaos in the two states, possibly fueled further by es-
41

calating conflict with Israel, or between Lebanon and 

Syria over their own respective maritime boundaries, 

might contribute to a strengthening of those regional 

political influences that U.S. policymakers would undoubtedly prefer to avoid. Neither does Israel benefit 

from unstable neighboring states, for the potential for 

growth in politically radical elements, in support of or 

parallel to existing political groups such as Hezbollah, 

poses additional security risks to Israel’s own territory. Jordan and Egypt, on the other hand, are recipients 

of substantial amounts of U.S. foreign aid, rendering 

economic solutions to their long-standing domestic 

energy woes, such as low-cost Israeli gas, a potential 

area of interest for U.S. diplomatic efforts for reasons 

beyond the clear political and economic policy considerations that will likely exist in Israeli policy circles.89

Both countries have struck historical peace deals with 

Israel, and Jordan’s role in the Middle East Peace Process, in the Syrian Civil War (by taking in Syrian refugees), and U.S.-Jordanian military and intelligence 

cooperation90 render a facilitating U.S. role in IsraeliJordanian talks over mutual gas trade a potential area 

for U.S. involvement.

U.S. diplomatic efforts have also been, and should 

continue to be, directed at finding a comprehensive 

peace agreement between Israelis and Palestinians 

that ends the decades-long stalemate that has led to 

deeply unsatisfying outcomes for both sides. Israeli 

as well as Palestinian offshore hydrocarbon resources 

could play a significant role in facilitating mutual trust 

and the willingness to cooperate, including between 

Israel and a few of its other Arab neighbors, Jordan 

and Egypt. Palestinian gas offshore Gaza furthermore 

provides a potentially valuable economic prize, the 

development of which could be tied to the stabiliza-
tion of Israeli-Palestinian ties and the rebuilding of the 

now wartorn Gaza Strip and the Palestinian economy 

as a whole. It is, nevertheless, important to realize 

the limitations of the approach of “peace pipelines” 

to cement peace where underlying political disagreements remain unresolved. Therefore, using gas for the 

purpose of solving political problems that remain unrelated to gas is a trap that should be carefully avoided. U.S. diplomatic support may also be specifically 

needed in the already existing conflict between Israel 

and Lebanon about the disputed maritime territory 

across the 2,000 blue line—with ongoing U.S. mediation between the two parties to the conflict being an 

important contribution to reducing the possibility of 

escalation into military conflict.91

In the event of escalating regional tensions, the 

United States also holds an important military position that could have an impact in securing the East 

Mediterranean. Prospects for regional LNG exports, 

based on Cyprus, with the possibility of Israeli and 

later Lebanese LNG exports, raise the potential for 

essential gas infrastructure to become a target of politically motivated sabotage, terrorist attacks, and, in 

the case of cross-border military conflict, military attacks against LNG infrastructure on a much greater 

scale than is currently possible. LNG plants, while in 

principle not as dangerous a target as already traveling oil transport freighters in the East Mediterranean, 

offer a highly symbolic target for attack, and unlike 

the subsea pipeline infrastructure, are just as visible 

as oil platforms. The additional potential for liquids 

production from several East Mediterranean wells 

further adds to the explosive potential that any targeted attack against natural gas production platforms in 

the Mediterranean Sea could have. Limited distances 

42
43

between East Mediterranean neighbors means that 

in many cases, results such as the destruction of gas 

and oil production platforms and subsequent oil spills 

into the East Mediterranean Sea would likely affect 

neighboring countries as well; the densely populated 

coastlines of Gaza, Israel, and Lebanon mean substantial parts of the populations could suffer collateral 

damage from attacks against land infrastructure such 

as onshore LNG export facilities and gas production 

plants. 

In Israel in particular, the prospect of an onshore 

LNG plant along the crowded Israeli coastline and 

its potential to become the target of terrorist attacks 

has fueled a domestic debate about the desirability 

of LNG exports via an Israeli land facility in the first 

place—adding to those advocates calling for the total 

cancellation of Israeli gas export plans for reasons of 

energy security. Even in the case of offshore FLNG export facilities or a shared LNG facility on Vassilikos, 

Israeli LNG plants could still be the targets of terrorist 

activity or military attacks in case of an armed crossborder conflict after all; indeed, the potential for Cyprus to be drawn into such a conflict through attacks 

against joint Israeli-Cypriot facilities will need to be 

considered. U.S. military training and equipment support, and a U.S. diplomatic position supportive of both 

Cyprus and Israel in case of any third party’s attack 

against their energy infrastructure and gas developments, could prove essential in this equation.

CONCLUSION AND FINAL 

RECOMMENDATIONS

The East Mediterranean region, with its multiplicity of long-standing, unresolved political and territorial 

disputes and conflicts—a jigsaw of different political 
44

and economic interests geographically located where 

Europe, Eurasia, and the Middle East intercept—remains of critical geostrategic importance for U.S. interests. The recent discoveries of sizeable hydrocarbon resources, placed in the region’s former context of 

energy-import dependency, provides a significant opportunity to strengthen regional cooperation in a way 

that benefits all sides but also holds much potential to 

complicate further the region’s conflict-prone geopolitical architecture. U.S. support, driven by key U.S. 

interests in the area, eventually may prove critical to 

help shape the way in which natural resources define 

the East Mediterranean’s regional security landscape 

over the coming years. In particular:

• The stability of Cyprus is of great importance to 

the continuity of U.S. military and intelligence 

operations. To retain U.S. military communications facilities on the island, the U.S. Government should continue its efforts to support the 

improvement of Cypriot-Turkish relations and 

to ensure that conflicting interests and overlapping claims do not deteriorate to the point of a 

conflict between two of its NATO allies.

• Israel’s security, and the stability of the Levant—in particular the Israel-Lebanon, IsraelJordan, and Israel-Palestinian Territories borders—lies at the heart of U.S. foreign policy in 

the region. U.S. mediation to help find a sustainable modus operandi for the disputed territories, such as joint exploration and production 

or the sharing of revenues could help prevent 

further escalation into military conflict, with 

the potential to destabilize the already fragile 

region further.
45

• U.S. security and military support for its main 

allies in the case of an eruption of natural resource conflict in the East Mediterranean may 

prove essential in managing possible future 

conflict; this involves cooperation in areas such 

as intelligence and nonlethal security as well as 

the evaluation of different risks associated with 

the region’s various export options.

U.S. experience in information operations and strategic communications can help its partners in the East 

Mediterranean craft their strategy for creating public 

support for any negotiated regional gas trading and 

cooperation framework. The lack of supportive public 

sentiment in Egypt for collaborating with Israel, for 

instance, is one of the key challenges to initiating any 

commercial negotiations. The sustainable success of 

a cooperation agreement depends on a capability to 

study systematically and understand different audiences in a specific context to inform policy and shape 

impactful communications messages. It should also 

be obvious that any absence of visible U.S. diplomatic 

and technical assistance could lead to a gradual change 

of alliances among some parts of the region toward 

emerging powers and potential new peace brokers 

such as Russia—which already entertains a strong interest in East Mediterranean gas developments—and 

notably China. 

Finally, the East Mediterranean hydrocarbon discoveries offer the region’s economies a very real chance 

to transform their domestic economies and their energy mixes, thereby creating viable long-term growth 

and economic prosperity. U.S. support—diplomatic 

and, where necessary, military—can form a potentially powerful element in the safeguarding of these 
46

long-term economic benefits, at little cost in relative 

terms. In the wake of the political unrest and frustration that has swept the Arab streets since early-2010, 

and Cyprus’s continuing difficult financial position, 

this would be no small success. It would be no less 

so in view of the added benefit of political peace and 

stability in one of the world’s most conflicted regional 

security systems in the 20th and 21st century.

ENDNOTES

1. “East Mediterranean Region,” Country Analysis Brief, Washington, DC: U.S. Energy Information Administration (EIA), August 15, 2013, available from www.eia.gov/countries/regions-topics.

cfm?fips=EM. 

2. A full profile of Syria as an oil and gas producer can be 

found at Syria Country Analysis Brief, Washington, DC: EIA, February 18, 2014, available from www.eia.gov/countries/cab.cfm?fips=SY. 

3. Hakim Darbouche, Laura El-Katiri, and Bassam Fattouh, 

”East Mediterranean Gas: What Kind of Game Changer?” Research 

Paper, Oxford, UK: Oxford Institute for Energy Studies, December 2012, available from www.oxfordenergy.org/wpcms/wp-content/

uploads/2012/12/NG-71.pdf; Energy balance data for all East Mediterranean countries can be found at EIA International Energy 

Statistics database, 2014, available from www.eia.gov/cfapps/ipdb

project/IEDIndex3.cfm. 

4. Brenda Schaffer, “Israel—New Natural Gas Producer in 

the Mediterranean,” Energy Policy, Vol. 39, 2011, p. 5,379; see also 

Simon Henderson, “Energy Discoveries in the Eastern Mediterranean: Source for Cooperation or Fuel for Tension? The Case of 

Israel,” GMF Policy Brief, Washington, DC: The German Marshall 

Fund of the United States, June 2012. 

5. Darbouche, El-Katiri, and Fattouh, p. 9. 

6. “Overview of Oil and Natural Gas in the Eastern Mediterranean Region,” Analysis Brief, Washington, DC: EIA, Au-
47

gust 15, 2013, available from www.eia.gov/countries/regions-topics.

cfm?fips=EM; see also Schaffer.

7. Walid Khadduri, “The East Mediterranean Offshore Petroleum Frontier,” Middle East Economic Survey, Vol. 53, Issue 44, 

November 1, 2010.

8. Schaffer; Shoshanna Solomon, and Gwen Ackerman, “Israel Starts Tamar Gas Production,” Bloomberg, May 31, 2013.

9. “Noble Energy Announces Significant Discovery at Leviathan Offshore Israel,” Offshore Energy Today, December 30, 2010; 

Amiram Barkat, “Noble CEO: Leviathan Is Largest Gas Find in 

Our History, “’ The Jerusalem Post, December 29, 2010.

10. Schaffer; Khadduri.

11. Proven reserves from International Energy Statistics 2013, 

Washington, DC: EIA; Total estimate by authors.

12. Anastasios Giamouridis, “The Offshore Discovery in the 

Republic of Cyprus Monetisation Prospects and Challenges,” 

OIES Research Paper, NG 65, Oxford, UK: Oxford Institute for 

Energy Studies, July 2012; see also Anastasios Giamouridis, “Natural Gas in Cyprus. Choosing the Right Option,” GMF Mediterranean Paper Series, Washington DC: The German Marshall Fund 

of the United States, September 23, 2013. 

13. “Noble Estimates Cyprus Reserves at 3-9 Tcf, Eyes Israeli 

LNG Export,” Natural Gas Week, November 21, 2011. A previous independent estimate by consultants Netherland Sewell and 

Associates (NSAI) in early-March 2011 put Aphrodite’s mean 

reserves at 5.1-tcf, with a 50-percent probability. Noble, which 

works with a gross mean estimate of 7-tcf, dismissed these estimates, stating that NSAI utilized a “deterministic” calculation 

of resources, the results of which were “not directly comparable 

to the ‘probabilistic’ calculation.” See, MEES, Vol. 55, Issue 12, 

March 19, 2012, pp. 5-8.

14. “Total Signs on Deepwater Blocks Southwest of Cyprus,” 

Oil and Gas Journal, February 6, 2013; “ENI/Kogas Secure Deal For 

Cyprus Offshore Gas Exploration,” Middle East Economic Survey, 

February 4, 2013.
48

15. “Syria Country Analysis Brief,” Washington, DC: EIA, 

February 18, 2014, available from www.eia.gov/countries/cab.

cfm?fips=SY. At the time of this writing, Syria’s oil exports to 

Turkey and Europe are disrupted.

16. Syrian officials at the time blamed this on high exploration 

costs and low oil prices, but the reality includes probably poor 

seismic data and high resultant investment risk, coupled with expectedly unattractive rates of returns for international investors. 

17. Laura El-Katiri, Bassam Fattouh, and Richard Mallinson, “The Arab Uprisings and MENA Political Instability: Implications for Oil and Gas markets,” OIES Paper: MEP 8, Oxford, 

UK: Oxford Institute for Energy Studies, March 2014, available 

from www.oxfordenergy.org/wpcms/wp-content/uploads/2014/03/ME

P-8.pdf.

18. An overview of European sanctions is provided by 

the UK government, available from www.gov.uk/government/

publications/financial-sanctions-syria.

19. For example, see “Formation of Lebanon Panel Paves Way 

for Bid Round,” International Oil Daily, November 12, 2012. For a 

comprehensive analysis of Lebanon’s prospects as a future gas 

producer, see B. Fattouh and L. El-Katiri, “Lebanon: the Next 

East Mediterranean Gas Producer?” Mediterranean Paper Series, Washington, DC: The German Marshall Fund of the United 

States, forthcoming 2015.

20. “Political Stalemate Scaring Off Oil Bidders,” The Daily 

Star, August 15, 2013; Lubnan ja’lanu, “an ihtiati ghaz dhakhm 

bimiahihi” (“Lebanon Announces Large Natural Gas Reserves in 

its Waters”), Al Jazeera, September 24, 2013; “Al-wazir: taqdirat 

tushiru liwujud ghaz wan aft bi-kamiyyat kabira fi ma lubnan” 

(“Minister: Estimates Indicate the Existence of Oil and Gas in 

Large Quantities in Lebanon”), Reuters Arabic, October 27, 2013. 

21. “Bassil: Lebanon Has 30 Trillion Cubic Feet of Gas, 660 

Million Oil Barrels,” Naharnet Newsdesk, May 10, 2013.

22. Schaffer, 2011.
49

23. Avi Bar-Eli, “Ya’alon: British Gas Natural Gas Deal in 

Gaza Will Finance Terror,” Haaretz, October 21, 2007, available 

from www.haaretz.com/news/ya-alon-british-gas-natural-gas-deal-ingaza-will-finance-terror-1.231576; “BG Said to Sell Gas Field Off 

Gaza after Israel Blocks Project,” Bloomberg, March 9, 2012. 

24. A look at some of the world’s major disputes over territory and natural resources illustrates the size of the problem, for 

instance, the ongoing dispute between North and South Sudan 

over the oil-rich region of Abyei, and continued conflict between 

Iraq’s central government and the Kurdish regional government 

over ownership of local hydrocarbon resources. For instance, see 

“Sudan and South Sudan,” Washington, DC: EIA, September 5, 

2013, available from www.eia.gov/countries/analysisbriefs/Sudan/

sudan.pdf.

25. Paul Rivlin, “The Significance of Gas in the East Mediterranean,” Iqtisadi, Vol. 3, No. 9, October 16, 2013.

26. Ibid.

27. Previous studies of the Palestinian gas market suggested 

that Gaza Marine, the main field discovered offshore the coast of 

Gaza, would be comparatively easy to develop, given its proximity to the coastline and low depth. It would easily feed the Palestinian market’s limited domestic demand of around 0.3-bcm per 

year during the early-2010s, and could thus allow up to 1-bcm/

yr of additional gas to be exported to neighboring markets, for instance, Egypt, Jordan, or—relevant during the early-2000s when 

Israel was looking for import supplies—Israel. Gas for the Palestinian market could be used in the existing 140-MW Gaza power 

plant, as well as two planned gas-fired power stations in the West 

Bank, contributing both to secure electricity supplies and a source 

of revenue for the stagnating Palestinian economy. For instance, 

see “No Advance Towards Development for Offshore Gaza Marine,” Middle East Economic Survey, Issue 55, Vol. 40, September 

28, 2012.

28. For a background, see Ibid.; Walid Khadduri, “Gaza Gas: 

Challenges Versus Opportunities,” Oxford Energy Forum, August 

2013, pp. 28-30; David Wurmser, “The Geopolitics of Israel’s Offshore Gas Reserves,” Jerusalem, Israel: The Jerusalem Center for 
50

Public Affairs, April 4, 2013, available from jcpa.org/article/thegeopolitics-of-israels-offshore-gas-reserves/. 

29. “Egypt Struggles with Gas Supply Challenge,” Middle 

East Economic Survey, Issue 56, Vol. 7, February 15, 2013; Ali Aissaoui, “Between a Rock and a Hard Place: Egypt’s New Natural 

Gas Supply Policy,” APICORP Economic Comment, Vol. 8, No. 3, 

March 2013.

30. Matt Bradley and Joshua Mitnick, “Egypt Cancels Israel 

Supply Deal,” The Wall Street Journal, April 22, 2012. Egypt’s reasons to cancel the existing supply contract may indeed be multiple, including Egypt’s own increasing domestic gas shortage, 

exacerbated by a variety of export commitments and the reportedly unattractive gas price negotiated by the Mubarak regime 

with its Israeli (and Jordanian) customers. This price was tied to 

the political-ideological opposition of the newly elected Muslim 

Brotherhood government, which likely saw Israel as the likely 

first target of export contract revisions, to be later followed up 

by a doubling of prices for Jordan. See also “Egypt’s Gas Exports 

to Jordan Hit by Domestic Demand ‘Crisis’,” LNG Intelligence, 

February 6, 2013; “Al-ghaz al-masri muntaqa an al-urdun mundhu 5 ashhar” (“Egyptian Gas to Jordan Interrupted for the Fifth 

Month”), Alarab Alyawm, January 22, 2014. 

31. Shoshanna Solomon and Gwen Ackerman, “Israel Starts 

Tamar Gas Production,” Bloomberg, May 31, 2013. See also “Let 

There Be Light?” LNG Intelligence, July 12, 2012.

32. It should be noted that Jordan, an Arab country, was also 

severely hit by Egyptian gas infrastructure attacks and subsequent shortfalls in supply. Unlike with Israel, Egypt offered Jordan a new contract arrangement, which more than doubled the 

price Jordan had to pay for Egyptian gas virtually overnight, with 

continued supply disruptions since. Egyptian problems to deliver 

by now also reflect domestic production shortfalls inside Egypt, 

primarily as a result to poor planning by the previous Mubarak 

regime, the vast fiscal deficit amounted as a result of more than 

3 years of political paralysis, and subsequent underinvestment in 

the development of new resources. For example, see “Jordan: First 

Review Under the Stand-By Arrangement, Request for Waivers of 

Nonobservance of Performance Criteria, Modification of Perfor-
51

mance Criteria, and Rephasing of Access—Staff Report,” Washington, DC: International Monetary Fund; “Press Release on the 

Executive Board Discussion; and Statement by the Executive Director for Jordan,” Country Report No. 13/130, Washington DC: 

International Monetary Fund, May 2013, pp. 4, 8, 16.

33. For example, C. Ben-David, “Israel Awards First License 

to Drill on Golan Heights to Genie,” Bloomberg, February 21, 2014.

34. For example, see Simon Henderson, “Energy Discoveries 

in the Eastern Mediterranean: Source for Cooperation or Fuel for 

Tension? The Case of Israel,” Policy Brief, Washington, DC: The 

German Marshall Fund of the United States, June 2012; Tullio 

Scovazzi, “Maritime Boundaries in the Eastern Mediterranean 

Sea,” Policy Brief, Washington, DC: The German Marshall Fund of 

the United States, June 2012; Eduard Gismatullin, “Israel-Cyprus 

Deal on Gas as Lebanon Won’t Negotiate,” Bloomberg, April 19, 

2012; Amiram Barkat, “Israel Rejects Lebanon EEZ Compromise,” 

Globes, October 29, 2013. See also the Arab press, “Kharitat ghaz 

al-amrikiyyah lil-tawassut beina lubnan wa israil” (“American 

Gas Map to Mediate between Lebanon and Israel”), Albawaba, 

December 17, 2012; “Israil tarfudhu al-taswiah al-amrikiyyah lilhudud al-bahriyyah: al-ghaz li” (“Israel Rejects American Mediation for Land Border: Gas”), Al-Akhbar, October 31, 2013.

35. The approximate geographical location of Lebanon’s offshore blocks is available from Spectrum, the Norwegian company 

tasked by Lebanon to carry out initial seismic work in its offshore territory. Available from Spectrum’s website, www.spectrumasa.com/

press-release/spectrum-extends-lebanon-3d-multi-client-seismiccoverage.

36. “Landau Says Israel Willing to Use Force to Protect Gas 

Finds Off Coast,” Bloomberg, June 24, 2010. See also “Natural Gas 

Could Lead to New Lebanon-Israel War,” Associated Press, July 

28, 2010.

37. Ibid.

38. “Cyprus, Lebanon to Explore Closer Energy Ties,” LNG 

Intelligence, January 9, 2013; “Cyprus And Lebanon Discuss Lebanon-Israel Maritime Dispute,” Middle East Economic Survey, Issue 

55, Vol. 13, March 26, 2012.
52

39. Matthew Bryza, ‘”Israel-Turkey Pipeline Can Fix Eastern 

Mediterranean,” Bloomberg, January 20, 2014.

40. For a background to the Cyprus conflict, see, for instance, 

Vincent Morelli, “Cyprus: Reunification Proving Elusive,” Congressional Research Service (CRS) Report for Congress, Washington, 

DC: CRS, June 25, 2013, available from www.fas.org/sgp/crs/row/

R41136.pdf; Derya Beyatlı, Katerina Papadopoulou, and Erol Kaymak, “Solving the Cyprus Problem: Hopes and Fears,” Interpeace, 

A report produced as part of Cyprus 2015 Initiative, 2011, available from www.interpeace.org/publications/cyprus/22-solving-thecyprus-problem-hopes-and-fears-english/file. “The Cyprus Stalemate: 

What Next?” Europe Report No. 171, Washington, DC: International Crisis Group, March 8, 2006.

41. Part of the considerations is the necessity to ensure Cypriot 

gas export revenues, in the absence of a comprehensive settlement 

between the two Cypriot communities, are not simply absorbed 

by general government spending by the Cypriot state. Provisions 

such as a Turk-Cypriot heritage fund to benefit Turkish Cypriots 

once a peace agreement is signed has been one of several propositions. For example, see Toula Onoufriou, “Cyprus—a Future Energy Hub?” Policy Brief, Washington, DC. The German Marshall 

Fund of the United States, October 2012. See also “Use of Cypriot 

Gas Deposits as Collateral Premature, Says Kassinis,” Middle East 

Economic Survey, Issue 55, Vol. 52, December 21, 2012.

42. “TPAO Begins Drilling Well in Northern Cyprus,” Middle 

East Economic Survey, Issue 55, Vol. 19, May 7, 2012.

43. Press Release No. 181 regarding the “Greek Cypriot Administration’s Gas Exploration Activities in the Eastern Mediterranean,” August 5, 2011, available from www.mfa.gov.tr, as quoted 

in “Aphrodite’s Gift: Can Cypriot Gas Power a New Dialogue?” 

Europe Report No. 216, Washington DC: International Crisis Group, 

April 2, 2012.

44. Press Release No. 43, “Regarding the Second International 

Tender for Off-Shore Hydrocarbon Exploration Called by the Greek 

Cypriot Administration (GCA),” February 15, 2012, available from 

www.mfa.gov.tr/no_-43_-15-february-2012_-second-international-
53

tender-for-off_shore-hydrocarbon-exploration-called-by-the-greekcypriot-administration-_gca_.en.mfa.

45. “Aphrodite’s Gift,” International Crisis Group, p. 5.

46. Darbouche, El-Katiri, and Fattouh, p. 7.

47. “Aphrodite’s Gift,” International Crisis Group, p. 6.

48. Giamouridis, “Natural Gas in Cyprus,” p. 7.

49. “Cyprus Energy Ministry Plans Roadmap for Hydrocarbon Industry Launch,” Platts Commodity News, April 26, 2013.

50. “Cyprus LNG Plans Wobble,” Middle East Economic Survey, Issue 56, Vol. 41, October 11, 2011.

51. For a background to Turkey’s own political turmoil in 

2013, see Jim Zanotti, “Turkey: Background and U.S. Relations,” 

CSR Report for Congress, Washington, DC: CRS, March 27, 2014, 

available from www.fas.org/sgp/crs/mideast/R41368.pdf.

52. The number of registered Syrian refugees can be accessed 

via the UNHCR website available from https://data.unhcr.org/

syrianrefugees/regional.php.

53. “Obama: Chemical Weapons in Syria Are a ‘Red Line’,” 

CBS News, August 20, 2012. For an overview of the U.S. response 

to the Syria crisis, see Christopher M. Blanchard et al. “Armed 

Conflict in Syria: Overview and U.S. Response,” CRS Report, 

Washington, DC: CRS, January 15, 2014, available from www.fas.

org/sgp/crs/mideast/RL33487.pdf.

54. E.g., “Political Infighting Over Oil and Gas Illustrates 

Lebanese’s Electoral Folly,” The National, October 14, 2013. See 

also Bassam Fattouh, and Laura El-Katiri, “Lebanon: The Next 

East Mediterranean Gas Province?” Oxford Energy Forum, August 

2013, pp. 24-25.

55. “Formation of Lebanon Panel Paves Way for Bid Round,” 

International Oil Daily, November 12, 2012.
54

56. “Political Stalemate Scaring Off Oil Bidders,” The Daily 

Star, August 15, 2013; “Lil-marrah al-thalithah: lubnan yumaddidu muhlah taqdim ‘urudh tanqib al-ghaz” (“For the Third Time: 

Lebanon Extends the Deadline for Gas Exploration Tender”), AlIqtisadiyyah, January 9, 2014.

57. See Jonathan Stern and Howard Rogers, “The Transition to Hub-Based Gas Pricing in Continental Europe,” Jonathan 

Stern, ed., The Pricing of Internationally Traded Gas, Oxford, UK: 

Oxford University Press, 2012; Jonathan Stern and Howard Rogers, “The Transition to Hub-Based Gas Pricing in Continental 

Europe,” OIES Working Paper NG49, March 21, 2011, available 

from www.oxfordenergy.org/2011/03/the-transition-to-hub-based-gaspricing-in-continental-europe/; Jonathan Stern, “Continental European Long-Term Gas Contracts: Is a Transition Away from Oil 

Product-Linked Pricing Inevitable and Imminent,” OIES Working Paper NG34, September 1, 2009, available from www.oxfordenergy.org/2009/09/continental-european-long-term-gas-contracts-is-atransition-away-from-oil-product-linked-pricing-inevitable-andimminent/.

58. For a discussion of the pros and cons surrounding a direct 

pipeline from Cyprus to Turkey, see Giamouridis, “Natural Gas 

in Cyprus,” p. 16. 

59. A graphically illustrated overview of different Israeli export options can be found at Katie Carnie et al., “Options for Exporting Israeli Gas,” Financial Times, November 6, 2013, available 

from www.ft.com/cms/s/0/b62ba372-463c-11e3-9487-00144feabdc0.

html#axzz2rzd7OQwg.

60. Cyprus has signed Memoranda of Understanding (MOU) 

with the development consortia of three of its tendered-out blocks 

in June and November 2013 and has established a time schedule 

for the construction and beginning of production of an liquefied 

natural gas liquefaction facility at Vassilikos port, expandable in 

the future for further production. “Cyprus signs MOU for LNG 

terminal talks with Noble, Avner, Delek,” Reuters, June 26, 2013; 

“Cyprus, Total sign MoU for LNG terminal,” Reuters, November 

7, 2013.

61. “Aphrodite's Gift,” International Crisis Group, p. 6.
55

62. John Reed and Daniel Dombey, “Producers Eye Export 

Routes for Israeli Gas,” Financial Times, March 11, 2013.

63. Darbouche, El-Katiri, and Fattouh, pp. 20-23.

64. With relatively little international experience in the application of FLNG, an additional risk to be born is technology risk.

65. See J. Stern et al., “European Alternatives to Russian Gas,” 

OIES Research Paper, Oxford, UK: Oxford Institute for Energy 

Studies, forthcoming, 2014.

66. Sharon Wrobel and Jonathan Ferziger, “Palestine Power to 

Pay $1.2 Billion for Gas from Leviathan Well,” Bloomberg, January 

5, 2014; “Palestinians to be First Buyers of Israeli Natural Gas,” 

The Times of Israel, January 6, 2014. 

67. “Leviathan Signs Initial Deal to Supply Egypt LNG,” Argus, June 30, 2014; “Israel’s Pipeline Hopes,” International Gas Report, Issue 753, July 14, 2014, p. 10.

68. David Kashi, “Forget John Kerry’s Shuttle Diplomacy; 

Israel and Palestinians Sign Historic Energy Deal,” International 

Business Times, January 7, 2014.

69. Egypt, the only other regional gas producer with geographical access to the Gaza Strip though not the West Bank, has 

been experiencing its own gas shortages due to fast domestic demand growth, struggling to fulfill existing export contracts, and 

therefore offering no commercial supply option to the Palestinians under current market circumstance. See also Endnote 28.

70. For an overview of the two countries’ domestic energy sectors, see Egypt Country Analysis Brief, Washington, DC: EIA, July 

31, 2013, available from www.eia.gov/countries/cab.cfm?fips=EG; 

and Jordan Country Analysis Note, Washington, DC: EIA, available 

from www.eia.gov/countries/country-data.cfm?fips=JO.

71. “Israel-Jordan Sign $500 Million Natural Gas Deal,” The 

Times of Israel, February 19, 2014.
56

72. “Gulf States Finalize Rescue Package For Egypt,” Middle 

East Economic Survey, Issue 56, Vol. 28, July 12, 2013; “Egypt Receives Gulf Aid But Qatar Backs Off,” Middle East Economic Survey, Issue 56, Vol. 39, September 27, 2013; “Saudi-Egypt Power 

Link Deal Signed, but GCC Grid Usage ‘Minimal’,” Middle East 

Economic Survey, Issue 56, Vol. 23, June 7, 2013. 

73. Simon Henderson, “Natural Gas Export Options for Israel 

and Cyprus,” Mediterranean Paper Series, Washington, DC: The 

German Marshall Fund of the United States, September 2013. 

74. “Noble Energy Prefers Selling Leviathan Gas Regionally,” 

Globes, November 24, 2013.

75. Various Jordanian news sources suggest Israeli-Jordanian talks have been at a very advanced stage at the time of this 

writing. For example, “Mubahathat sirriyyah ‘al-urduniyyah-alisrailiyyah’ bi-sha’n al-ghaz,” (“Jordanian-Israeli Secret Talks on 

Gas”), Al-‘arab al-yaum, January 9, 2014.

76. Jeremy M. Sharp, “Jordan: Background and U.S. Relations,” CSR Report for Congress, Washington, DC: CRS, January 27, 

2014, available from www.fas.org/sgp/crs/mideast/RL33546.pdf.

77. “Ihtidjadjat thid al-hukumah al-misriyyah bisabab tasdir al-ghaz li-isra’il” (“Protest against the Government because 

of Gas Export to Israel”), Al-Jazeera, December 17, 2008; “Khiar 

al-tadwil aqdiyyah tasdir al-ghaz al-masriy li-isra’il” (“Option of 

Internationalization of the Exporting Egyptian Gas to Israel”), AlJazeera, November 21, 2008.

78. Sharp, p. 7.

79. Michael Ratner et al., “Europe’s Energy Security: Options 

and Challenges to Natural Gas Supply Diversification,” CRS Report for Congress, Washington, DC: CRS, August 20, 2013, available from www.fas.org/sgp/crs/row/R42405.pdf; Kristin Linke and 

Marcel Vietor, “Beyond Turkey: The EU’s Energy Policy and the 

Southern Corridor,” International Policy Analysis, Berlin, Germany: Friedrich Ebert Stiftung, November 2010, available from library.fes.de/pdf-files/id/07553.pdf. Turkey’s energy strategy can also 

be followed on the Ministry of Foreign Affairs’ website: Republic 
57

of Turkey, Ministry of Foreign Affairs, Turkey’s Energy Strategy, 

Ankara, Turkey, 2013, available from www.mfa.gov.tr/turkeysenergy-strategy.en.mfa. 

80. The authors thank one of their friends, who commented 

on an earlier version of this monograph, for pointing out the wider benefit potential of this “win-win-win” option.

81. See Gulmira Rzayeva, “Gas in the Turkish Energy Market: 

Policy and Challenges,” Research Paper, Oxford, UK: Oxford Institute for Energy Studies, February 10, 2014.

82. Matthew Bryza, “An Israel–Turkey Natural Gas Pipeline: 

Inter-Connection of Commercial and Geopolitical Logic,” Oxford 

Energy Forum, No. 93, August 2013.

83. The UN report outlining the incident is available online. 

See Geoffrey Palmer et al, “Report of the Secretary-General’s Panel 

of Inquiry on the 31 May 2010 Flotilla Incident,” New York: United 

Nations, September 2011, available from graphics8.nytimes.com/

packages/pdf/world/Palmer-Committee-Final-report.pdf.

84. Zanotti, p. 25, referring to a summary of conversation between Netanyahu and Erdogan, from Israeli Prime Minister’s Office website, March 22, 2013.

85. For an overview over U.S.-Turkish relations, see Ibid.

86. Ibid.

87. For example, Masahiro Miyoshi, “The Joint Development 

of Offshore Oil and Gas in Relation to Maritime Boundary Delimitation,” International Boundaries Research Unit (IBRU) Maritime 

Briefings, Vol. 2, No. 5, Durham: University of Durham, 1999.

88. For a background on U.S.-Lebanese and U.S.-Syrian relations, see Christopher M. Blanchard, “Lebanon: Background 

and U.S. Policy,” CRS Report for Congress, Washington, DC: CRS, 

February 14, 2014, available from www.fas.org/sgp/crs/mideast/

R42816.pdf.
58

89. Total U.S. foreign aid to Jordan in the financial year 2012 

amounted to around $13.1 bn while Egypt, prior to the election 

of the Muslim Brotherhood government, which was criticized 

by many Western governments, was in annual receipt of around 

$1.55 bn U.S. bilateral foreign aid. Sharp, p. 9; Rebecca Nelson, 

and Jeremy M. Sharp, “Egypt and the IMF: Overview and Issues for Congress,” CRS Report for Congress, Washington, DC: 

CRS, April 29, 2013, available from www.fas.org/sgp/crs/mideast/

R43053.pdf.

90. Zanotti.

91. U.S. mediation efforts reach back several years ago and 

were intensified in 2012 and 2013. Barak Ravid, “U.S. Drafts Compromise for Lebanon-Israel Dispute over Natural Gas Resources,” 

Haaretz, December 16, 2012; “U.S. Willing to Help Solve Lebanese-Israeli Maritime Border Conflict,” Natural Gas Europe, July 

22, 2013.
U.S. ARMY WAR COLLEGE

Major General William E. Rapp

Commandant

*****

STRATEGIC STUDIES INSTITUTE

and

U.S. ARMY WAR COLLEGE PRESS

Director

Professor Douglas C. Lovelace, Jr.

Director of Research

Dr. Steven K. Metz

Authors

Ms. Laura El-Katiri

Dr. Mohammed El-Katiri

Editor for Production

Dr. James G. Pierce

Publications Assistant

Ms. Rita A. Rummel

*****

Composition

Mrs. Jennifer E. Nevil