ELIAMEP
Geopolitics of Energy
REGIONAL ENERGY SECURITY AT A CROSSROADS:
The Geopolitics of Caspian and Eastern Mediterranean Hydrocarbons
Athens, 16 March 2012
Electra Palace Hotel, Plaka
Dr. Yannis Maniatis, Deputy Minister of Environment, Energy & Climate Change
“Greek oil & Gas Exploration”
Thank you Mr Chairman,
Excellencies, ladies and gentlemen,
Let me begin by thanking the Hellenic Foundation for European & Foreign Policy for hosting this Conference, especially in a moment where the geopolitical map of oil and natural gas is rapidly changing in our region.
I will continue to emphasize in my public speaking that in times of crisis, such as the one we are facing, the best defence is to be creatively offensive and maximize the benefits we can secure for the exploitation of our country’s mineral resources.
Within this framework, the confirmed and potential oil and gas reserves in Israel, Cyprus and Greece and the dynamics between the geopolitical and business interaction, can play a leading role in a coordinated strategy to reduce the import dependence of the EU on non-European sources.
This is a historical opportunity for our country.
And we should use this opportunity over time and cross party.
Israel but also Greece and Cyprus as two EU member states can critically support the twoastrategicapillarsaofaEUaenergyapolicy: Differentiation of energy sources and differentiation of energy routes.
The evidence and information in all areas of the Mediterranean basin create reasonable conditions for the overthrow of the existing geopolitical balance in the region.
Now, let me turn to the issue on which there is extensive discussion lately.
Is there any Oil and Gas in the Greek Seas???
I want to repeat and emphasize that only a detailed and persistent programme of seismic explorations and drillings would give us the accurate answers we all want and hope for. That is exactly what we have tried to organize, anticipate and implement.
Let me also clarify that it is perhaps the only issue, the only public area, where there is full and complete identification of almost all Greek political forces.
All major parties fully support these initiatives, because these are initiatives that certainly go beyond the persons, beyond the parties, beyond the timing.
That’s why we are committed to transparency in all our actions. It is a principle to us and so far we have acted accordingly, to inform the members of the Greek Parliament, with complete transparency and always in favor of national interest.
Equally important to my understanding is the immediate impact of domestic oil production for Greece’s own security of energy supply. Greece spends up to 4% of its GDP, equal to almost 10-12 billion EUR per year, in order to pay for its oil imports. We are one of the most heavily dependent oil importers in the European Union, with imports accounting for 99,5% of our demand. This level of dependency is no longer sustainable given the fragile condition of the country’s finances. This makes us highly vulnerable to violent price increases while negatively influencing our diplomatic position. Greece’s high level of dependence on Iranian crude oil imports and the political implications of this fact are indicative of the geopolitical risks associated with the nearly complete absence of indigenous oil production.
As you may have heard, last week was the deadline submission for offers for the participation in the non-exclusive seismic survey tender and already the Evaluation Committee proceeds with the evaluation of the 8 offers. The international interest expressed for this tender, reflects not only the seriousness of our purpose but also the high probability of success that has been encouraged by the recent discoveries of natural gas in Cyprus’ Exclusive Economic Zone.
The participation of 8 world class level seismic exploration companies in Greece’s first exploration tender in almost fifteen years, constitutes with no doubt, a milestone.
We anticipate the highest quality standards for the reprocessing of the collected seismic data, which should be completed by the autumn of 2012. The completion of this process will allow us to move ahead as quickly as possible with the demarcation of specific block areas for exploration in the Ionian and Cretan Seas that could lead in the preparation for drilling activities even before the end of this year. In some of these areas, especially to the south of Crete, this would be the first systematic exploration undertaking ever attempted.
Preliminary indications from studies conducted by IGME (Greek National Institute for Geological Studies) and the existing archives of previous exploration attempts, which we intend to make accessible to all interested parties over the next few months, suggest the existence of extremely interesting probable reserves.
The revenue generated by the exploitation of hydrocarbons will NOT go to repay debt and is not included in any loan agreement. It has to be exploited for the benefit of the Greek people. I suggest being diverted to an Intergenerational Solidarity Fund and support effectively the country’s insurance system.
Apart from the seismic exploration tender, the state is able to fast track several other promising areas where the level of pre-existing seismic data is recent enough and substantial enough to justify the Open Door approach.
The Open Door tender for three areas in Western Greece, one onshore, in Ioannina, and two offshore, in the Gulf of Patras and in the Katakolo area, has been launched and all relevant information on that is available. I would like to inform you that the level of international interest is equally impressive with that expressed for the seismic exploration tender.
We also announced our plans to tender by July 2012, about 10 different onshore areas for exploitation throughout Greece. We are developing the entire spectrum of Greece’s hydrocarbon potential, including areas that would fall under the Open Door framework.
One of the parameters that have encouraged us to proceed with Greek oil exploration, is the recent success of Cyprus in the discovery of major quantities of exploitable natural gas in Block 12 of its Exclusive Economic Zone. Cyprus has launched in February 2012 a second tender round for the remaining Blocks which I am sure will attract the interest of major International Oil Companies (I.O.C). Greece will be present in the continuous efforts of Cyprus to exploit its energy wealth and establish a strategic energy corridor that would limit EU dependency on non EU gas imports while also minimizing the possibility of transit risk. The participation of Israel in this Corridor is crucial for the success of this undertaking.
The trilateral MoU Greece will sign with Cyprus and Israel on 28 March is the first step in consolidating this Energy Coalition that of course will not bias our historically close diplomatic relations with the major Arab States.
Ladies and gentlemen,
To conclude I would like to say that the State tried to be very careful in matters of hydrocarbons. All our public discussions were down to earth, because the last thing needed by the Greek society, these days, is a new fiction.
The sector of Hydrocarbon Exploration and Production is a very complex undertaking that demands the combination of many sciences and expertises from a technical, economic, legal and of course diplomatic point of view. We all need to unite and support this new and very promising initiative, whilst helping to transfer and more importantly to develop ourselves the necessary know-how that will enable Greece to maximize the exploitation of its natural resources in an era of national emergency.
Thank you very much for your attention.