Prudence and wisdom is necessary in the handling of natural gas
By Nicos Rolandis
AT 7am on Tuesday March 31, 1998, exactly 19 years ago, I was in the office of President Glafcos Clerides. I had been appointed minister of commerce, industry and tourism a month before. The portfolio of energy was in my ministry.
I had already been officially engaged with oil and gas in the Exclusive Economic Zone (EEZ) of Cyprus since 1980, when I was minister of foreign affairs. At that time, I had received in my office a representative of US oil majors Amoco and Standard Oil of Indiana, which were interested to invest in the sea south of Cyprus for “possible large hydrocarbon reserves” as they told me. At that time the UN had advised us not to proceed.
My meeting with President Clerides was preceded by a lot of thinking and meditation. Although I had studied in depth the whole subject, I knew that I might ridicule myself in case of a fiasco. After all, none of my predecessors in office had ever pursued such a matter.
At the beginning, when Clerides heard about the subject, he turned to me with a queer look on his face. I described in detail what I knew and what I had studied since 1980. He pondered the subject for a while, he looked at me once or twice. Finally I heard what I wanted to hear: “You may proceed, Nicos”, he told me. “Submit the matter to the Council of Ministers for approval”.
So, “let there be light”…. For the first time in its history the Republic of Cyprus would be officially engaged in the search for oil and gas.
I started working. My fear about efforts to ridicule me were unfortunately proved correct. Many media were humiliating me for months. The British High Commissioner Edward Clay stated ironically on January 26, 2001 that “there is as much oil in Cyprus as there is peanut butter below Manchester”. The culmination of all that, was an effort by certain circles to have me kicked out of the ministry because I was supposedly ridiculing the president. But Glafcos Clerides stuck to his unwavering position. He asked me to go on. So I went on. On Fabruary 17, 2003 I signed in Cairo the first EEZ agreement in the Mediterranean. I also delimited the EEZ of Cyprus. I continued in order to reach the point of ‘light’. In February 2003 I passed the baton to my successor.
At that time I was also quite concerned with the dangers which might lie in wait when there is more than one suitor for great wealth. In our case this wealth might be in the dozens of billions of US dollars. It was well known that Turkey had laid a claim to Cyprus’ hydrocarbons. I had written in an article of mine at that time that “hydrocarbons may prove to be a blessing or a curse for a country”.
It was obvious through my contacts with foreign governments that they would not recognise any rights to Turkey, but on the other hand they firmly believed that the Turkish Cypriots were entitled to benefit from the bonanza (there were many statements to that effect). That was my personal view as well. So, in 2006 I put forward the following proposal, which might be adopted, irrespective of any progress in the intercommunal talks.
To have a disclaimer signed by the two communities which would clarify that any hydrocarbons agreement would not constitute a precedent for the talks on Cyprus.
Out of the net hydrocarbons earnings, a percentage to be agreed (I had in mind 20-25 per cent) to be deposited in an escrow account in favour of the Turkish Cypriot community.
The amount in the escrow account to be released either upon solution of the Cyprus problem or after a number of years to be agreed (possibly 10 years) whichever would happen earlier.
We would thus secure a reasonable share for each community (Unless we believed that Turkey would ever let us acquire the whole wealth for ourselves).
Our own side did not adopt the above proposal. It relied on our sovereign rights. This position may be theoretically correct but in reality, Turkey has violated our sovereignty for 43 years and nobody cares to help. Who is going to help in the case of our EEZ? And also what about the rights of the Turkish Cypriots?
Mehmet Ali Talat, when he was “President”, invited me twice for lunch in 2006 and showed an interest to discuss the matter. He was also prepared to take up the matter with Ankara. But our side did not make any move.
Oil and gas is not simply a matter of sovereignty. There are many factors, which create disputes and conflicts in many parts of the world. The example of Greece, which does not proceed in the Aegean, and does not even delimit its EEZ in the Aegean in order to avoid a clash with Turkey, which disputes Greece’s sovereign rights, is there for 40 years. Are we stronger and cleverer than Greece? The case of the South China Sea with the huge oil and gas reserves and the many suitors which does not proceed either, despite the involvement of ExxonMobil, Gazprom and Rosneft and despite judgments of international tribunals, is another example, amongst 15-20 other cases where reserves remain untapped. Shall we manage to be the exception?
The fact that major corporations are involved in Cyprus is positive, but it does not avert the danger of conflict. Such corporations are conservative and they distance themselves from explosive situations if and when they occur. Furthermore, they have interests in Turkey, a market by 50 times larger than Cyprus. And anyway, their rights in the Cyprus EEZ will not be lost, whoever may eventually the master of the game in the area.
On many occasions in the past, I was proven correct in my assessments, when it was unfortunately too late: On Cyprus, on natural gas, on the S300 missiles and on other issues as well.
On the question of Cyprus, we lost good opportunities in the first years after the invasion. My advice fell on deaf ears, my resignation from the post of foreign minister and my efforts for a solution before it became too late, did not come to fruition. Nicos Anastasiades tries honestly and incessantly today in all possible ways. However, the road to a solution appears to be difficult of passage. Almost inaccessible. The conditions on the ground are not the same anymore.
Let us not be under illusions. If in the case of hydrocarbons, we do not strike a solution along the lines I suggested 11 years ago (if it is not already too late) and the Cyprus problem is not resolved, the scenarios which may follow will not be pleasant. I hope that they will not be nightmarish. I hope that Turkey will not start pumping the gas and the wealth of Cyprus (who is going to stop her?) or lead us into adventures.
The sultans of Ankara attack and threaten mighty countries like Germany, Holland, Austria and others. They are manoeuvring between Russia and the US in a complex game or huge interests. They distance themselves and insult Europe – and Europe puts aside her own rules and invites them as observers in her organs. Will they back down and retract in the case of Cyprus, Total and ExxonMobil when the wealth at stake is colossal?
Since 1955, in the international arena, we have been losers in our endeavours. In the process, we have lost more than one third of our motherland as well.
The President must move forward with a lot of care. He must watch his steps. He took over an extremely difficult situation. A great lot of prudence and wisdom is needed, both on the question of Cyprus and on natural gas.
Nicos Rolandis is a former commerce minister, foreign minister, MP and president of the Liberal Party