Establishing a network of partnerships in East Med: A discussion with Cypriot MFA I. Kasoulides

Cyprus’ Minister of Foreign Affairs Ioannis Kasoulides is expected in Beirut on November 09, 2016, along with his Greek and Bulgarian counterparts Nikos Kotzias and Daniel Mitov. Middle East Strategic Perspectives seized this opportunity to ask the Cypriot minister about his views regarding intra-regional cooperation in the Eastern Mediterranean. Cyprus, together with Greece, is seeking to establish a network of partnerships with countries in the region. While we have yet to see concrete outcomes, this diplomatic activity is creating new dynamics in a region with a poor record of intra-regional cooperation.

We then move on to discuss bilateral relations between Cyprus and Lebanon, particularly cooperation in the oil and gas sector, and negotiations aimed at reaching a unitization agreement setting the framework for the development of possible joint hydrocarbon reservoirs.

1) Cyprus is pursuing separate trilateral cooperation with various countries in the Eastern Mediterranean. Cyprus and Greece seem to be a constant feature, with the third country in the ticket being either Egypt or Israel, and more recently Jordan and Lebanon. Why is this trilateral approach preferred? How do you envision future cooperation in the Eastern Mediterranean and how do you evaluate the outcome so far compared to the overall objectives?

We are indeed working to establish a network of partnerships with the countries of the Eastern Mediterranean. This was a joint initiative that we took with Greece, considering our geographical position in the region, our historical relations and closeness with the countries and societies of the Eastern Mediterranean, and our shared view on the importance and prospects of this project-based approach. I should note that we are working on these trilateral formats of cooperation with the countries in the region in a non-exclusive manner and I should also tell you that some other EU member states have expressed interest on specific sectorial cooperation. We started with Egypt and Israel, now we are working with our Jordanian friends and hopefully very soon we will be able to initiate a concrete trilateral cooperation with Lebanon and also with Palestine. In all these partnerships, our aim is to move beyond political declarations and work on practical projects of cooperation in areas where we have identified potential for growth. And I must say, the Eastern Mediterranean provides us with ample space to seek synergies and collaborations on a plethora of projects, from agriculture to fisheries, to renewable energy, natural gas, education, tourism and so on. We are working in these trilateral formats because of the efficiency they offer us and because of the different sectoral priorities of each trilateral format, yet under certain conditions, I believe that these formats may coalesce into a more structured cooperation in our region.

2) Extensive seismic surveys show that the Lebanese offshore may hold a promising hydrocarbon potential. Cyprus has already made a discovery and is pursuing a promising exploration. Cyprus and Lebanon both have to rely on foreign companies when it comes to exploration and production. On the other hand, both have experience and skills to contribute to supporting and providing services for the oil and gas industry. Do you think bilateral cooperation at the governmental level would reflect on private sector cooperation among Cypriot and Lebanese companies? Would you consider this to be among the objectives of bilateral cooperation between the Cypriot and Lebanese governments?

Cyprus has always advocated that the best way to maximize the benefits from the Eastern Mediterranean hydrocarbons is through cooperation, coordination, synergies and larger scale projects. Governments should cooperate among themselves and set up the necessary institutional and environmental framework (legal, political, economic, etc.) within which the private sector could securely and profitably function; an institutional environment which would facilitate, promote and encourage different companies from different countries, in our case Cypriot and Lebanese companies, to cooperate, take risks and create synergies. This should be one of the objectives of bilateral cooperation between the Governments of Cyprus and Lebanon. This is also one of the aims of the trilateral cooperation frameworks the Government of Cyprus is pursuing with neighboring countries.

3) What is the status of negotiations over a unitization agreement between Lebanon and Cyprus? Is an agreement expected in the foreseeable future?

The government of Cyprus has submitted to the Lebanese Government a draft proposal for a Framework Agreement concerning the Joint Development and Exploitation of Cross-Median Line Hydrocarbons Reservoirs in June 2013. A first meeting of the negotiating teams of the two sides took place in December 2013. Lebanon undertook the commitment to presents its comments on the draft proposal; something which has not materialize up to now and we are looking forward to. Cyprus stands ready to proceed with the negotiations and the conclusion of such an Agreement at any time Lebanon would be ready to do so, and I hope that the new government of Lebanon will seize this opportunity to work with us on this issue.

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