Egypt, Greece and Cyprus expand East Med gas cooperation
CAIRO - Egypt, Greece and Cyprus have agreed to establish a forum for natural gas-producing nations in the eastern Mediterranean to capitalise on new gas discoveries.
The forum is to include countries that natural gas pipelines cross from wells to liquefaction plants and then to international markets, the Egyptian presidency said.
“It will help natural gas producing nations and those gas pipelines cross coordinate natural gas policies on the road to achieving maximum benefit from current and potential reserves,” Egyptian presidency spokesman Bassam Radi said.
The announcement followed an Egyptian-Greek-Cypriot summit on Crete, which took place within the framework of a cooperation mechanism agreed to in 2014 that aimed to increase cooperation between the three countries.
Egyptian President Abdel Fattah al-Sisi said the mechanism is turning into an important path to economic development and stability in the region. “We are committed to working together to explore more areas for cooperation,” Sisi said at a news briefing following talks with Greek Prime Minister Alexis Tsipras and Cypriot President Nicos Anastasiades.
This was the sixth meeting between the three leaders in four years. Tsipras said Crete would serve as a meeting point for future economic cooperation among Athens, Nicosia and Cairo. “It [the island] was at the centre of our discussion on energy cooperation today,” he said.
The Egyptian-Greek-Cypriot coming together is changing relations between the countries and allowing for stability.
New natural gas finds off the coasts of Egypt, Cyprus, Israel and Lebanon are making cooperation between those countries a necessity for continued development.
Egypt, Greece and Cyprus previously agreed to pump Cypriot gas to Egypt for liquefaction and then use it in the local market, the making of petrochemicals or export to international markets.
Egypt has two major liquefaction plants and 11 huge petrochemical factories, which are at the centre of Cairo’s strategy to become an energy hub, a target closer cooperation with Greece and Cyprus can ensure.
“This cooperation is very important because it brings Egypt very close to achieving its goal of becoming the energy centre of the region,” said Gamal al-Qaluibi, a member of the Egyptian Society for Petroleum and Mineral Resources, an advisory body of the Egyptian Ministry of Petroleum. “With small domestic markets, Cyprus and Greece will benefit from cooperation with Egypt whose geographical location makes it more capable of marketing their gas.”
Last February, an Egyptian company signed a deal to import $15 billion of Israeli gas over ten years, another step towards Egypt becoming an energy hub.
Talks among the leaders of Egypt, Cyprus and Greece October 10 also covered means of involving other eastern Mediterranean countries, particularly Jordan and Lebanon, in natural gas cooperation.
“This will bring about more peace and stability in the region,” Anastasiades said.
The talks touched on cooperation in electricity, tourism and investments. Egypt, Cyprus and Greece hope to establish an electricity connection project. Following the summit, they signed agreements on investment cooperation.
Local media reports said Cyprus and Greece were considering investing in the Suez Canal region, which is prepared to turn into Egypt’s next major investment hub.
Several countries, including Russia and China, are establishing industrial zones in the region, which will benefit from its proximity to the Suez Canal.
Despite the optimistic outlook for natural gas cooperation between Egypt, Greece and Cyprus, economic cooperation between the three countries does not reflect the depth of their political ties, experts said.
“Look at the figures,” said Bassant Fahmi, a member of the Economic Affairs Committee in the Egyptian parliament. “The three states need to work really hard to make these economic cooperation figures match their very close political and historical ties.”
In 2017, trade exchange between Egypt and Greece totalled $460 million, between Egypt and Cyprus less than $300 million. Greek companies invest $155 million in Egypt and Cypriot companies $280 million.
Apart from energy, tourism can be an important area for cooperation between the three states, experts said.
Despite their proximity, Egypt, Greece and Cyprus have been unable to present themselves as part of a single tourism package to international tourism markets.
“If they do this, the three countries will benefit greatly, given the fact that they are close to each other and that each of them can present tourists with a unique tourist experience,” said Adel Abdel Razik, an Egyptian tourism expert. “The three states also need to work a bit harder to encourage the movement of tourists between them.”