Energy: Greece latest to join black gold rush

After offshore deposits discovered by Israel and Cyprus

12 January, 15:30

(ANSAmed) - ATHENS, JANUARY 12 - Encouraged by the recent discoveries of massive underwater hydrocarbon deposits by Israel and Cyprus and haunted by the threat of bankruptcy, Greece appears to be taking its first serious steps in the sector with a national research programme for oil and natural gas. The newspaper Athens News reports that Greece's junior minister for energy and the environment, Yiannis Maniatis, who has tasked with leading the programme, held talks on January 3 with the Prime Minister, Lucas Papademos, and said that he expected the first off-shore drilling platform to be "symbolically launched somewhere in Greece" by the end of the year. However, this is likely to be wishful thinking. In the meantime, the Athens government has already begun the process for calling an international tender among oil companies interested in prospecting in the Gulf of Patras and in stretches of sea to the west of Ioannina and Katakolo, off the western coast of the Peloponnese. Initial estimates suggest that the deposit in the Gulf of Patras contains 200 million barrels of crude oil, with between 50 and 80 million off the coast of Ioannina and around three million off Katakolo. "In around twenty years, Greece can hope to cover around 30% of its annual energy requirements from national energy sources," Maniatis told the private radio station Flash, pointing out that internally sourced energy currently covers only 0.5% of consumption in the country. According to calculations made by the Ministry, crude oil worth 40 billion euros is expected to be extracted from the underwater deposits over a period of 15-20 years, with between 10 and 15 billion euros going into the state's coffers. At the moment, both American and Israeli companies appear to be interested in Greek hydrocarbons. But it is the area south of the island of Crete that is considered most promising, and the interest shown by the Texan company Noble Energy - the group that discovered major oilfields off Israel (Leviathan) and Cyprus (Lot 12) - suggests that the sort of strategic partnership that has already produced results in the two countries could also be agreed with Athens. Figures from the Unites States Geological Survey suggest that in the stretch of sea between Crete, Cyprus, Israel and Egypt, there are around 15 trillion cubic metres of natural gas and oil waiting to be extracted. An agreement between Noble Energy and Athens would also be very useful for Greece (as it has been for Cyprus) from a geopolitical point of view, as the American firm has close links with Israel. This combination has made it more difficult for Turkey to benefit from the recent threats made to the government in Nicosia for drilling works carried out south of its coasts.

Greece's reluctance to carry out offshore hydrocarbon research has been justified for decades by the fear that Athens may offend Turkish sensibilities over the thorny issue of territorial waters, which Ankara believes are not limited to the Aegean Sea. "When I worked on a Foreign Ministry commission on energy," the oil expert Ilias Konofagos said some time ago, "I saw that the Greek diplomats were excellent but fearful. They did not want to rock the boat".

At the start of the year, the Greek Foreign Minister, Stavros Dimas, met Maniatis to discuss the approach to take forward, considering the international implications of the hydrocarbon research programme. Although there has been talk of launching oil research for more than a year, the state agency that is expected to manage the rights issue - which was named as the Greek Company for Hydrocarbons and due to be officially created in May - still exists only on paper. The company is expected to include only two geologists and three engineers, who will be chosen from a restricted pool of civil servants already working for the state, according to an official announcement, which says that the deadline for applications expired on December 31. But a fight to the bitter end is likely in the corridors of power in Greece over these five positions. It is not yet clear whether Athens will follow the example set by Cyprus for its research programme and seek consultation from international experts, whose fees are known to be a lot more significant. (ANSAmed).

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