Netanyahu meets Greek, Cypriot leaders on gas pipeline

Benjamin Netanyahu and  Nicos Anastasiades Photo GPO Kobi Gidon

The underwater pipeline to Europe, which must still undergo a feasibility study, would take until 2025 to complete.

Prime Minister Benjamin Netanyahu is meeting with Cypriot President Nicos Anastasiades and Greek Prime Minister Alexis Tsipras. They discussed the laying of a 2,100-kilometer natural gas pipeline to Europe at a cost of NIS 25 billion. The three countries signed an initial memorandum of understanding on the matter in December 2017. The project will take until 2025 to complete.

The parties at the meeting discussed going on from the initial understandings to conducting a viability study. Since the proposed pipeline will be the world's longest undersea gas pipeline, the project is a difficult one that requires cooperation between the energy and infrastructure ministerial directors general of the three countries, in addition to that of Italy at a later stage.

At the trilateral meeting, Netanyahu, Anastiades, and Tsipras signed an internal security cooperation agreement (Israel-Cyprus) for the purpose of combating local crime and a cinema co-production agreement (Israel-Cyprus) designed to help the Israeli cinema industry by recognizing the eligibility of Israeli-Cypriot co-productions for government subsidies.

Cooperation agreements for the prevention of marine pollution and treating marine oil pollution (Israel-Cyprus-Greece), deployment of optical fibers (Israel-Cyprus-Greece), and lowering mobile phone roaming rates were also signed.

The energy ministers of Israel, Cyprus, and Greece were also present at the meeting in Cyprus in order to discuss in depth progress towards signing a joint agreement for construction of the undersea natural gas pipeline from Israel to Europe. Regular discussions on the project between the three countries' ministers of energy, energy ministries directors general, and various professional staff have been taking place in recent months.

The ministers said that this was a strategic infrastructure project representing a common interest of the countries and the European Union (EU) concerning natural gas.

The Israel Ministry of National Infrastructures, Energy, and Water Resources said, "The gas pipeline will ensure a long-term instrument for exporting gas from Israel and Cyprus to Greece, Italy, and other European markets, and will bolster competition in the gas sector. This project will reinforce energy security for the EU and diversify Europe's sources of natural gas."

This ambitious project is still far from implementation, however. The engineering difficulty of this complex infrastructure project lies in its undersea route, which reaches a depth of 3.3 kilometers, and the undersea volcanic activity between Cyprus and Greece, which is liable to cause damage to the pipeline that will be very difficult to repair. Another no less important difficulty is the project's economic viability. The average price of natural gas in Europe over the past year was around $5.40 per BTU, and not much less than that in Israel - $5.30 per BTU.

The energy ministries directors general team set up by the energy ministries of the three countries will continue meeting and discussing principles of the agreement between the governments at the next meeting, which is scheduled soon in Athens, while signing of the agreement is expected by the end of the year.

Published by Globes [online], Israel business news - www.globes-online.com - on May 8, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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Benjamin Netanyahu and  Nicos Anastasiades Photo GPO Kobi Gidon
Benjamin Netanyahu and Nicos Anastasiades Photo GPO Kobi Gidon
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