Dr. Carole Nakhle
This article was first published on GeoExpro Magazine (Vol. 21, Issue 3, 2024)
The discoveries of the giant Tamar and Leviathan gas fields offshore Israel in 2009 and 2010 respectively were hailed as two of the largest finds of the decade. As such, the perception of the Eastern Mediterranean and its role in gas markets was redefined, with some describing the discoveries as game changers, both for the region and the broader gas markets, particularly in Europe.
However, international interest in the Eastern Mediterranean’s offshore oil and gas resources has followed a cycle from widespread excitement to a stall in activity, to disappointment, and back to excitement again, and then disappointment and serious concerns, depending on local and global developments.
Gas production in Egypt and Israel
Data source: Energy Institute
Following the energy crisis that Europe experienced in 2022 and the quest of the European Union (EU) to find alternative gas suppliers to Russia, Eastern Mediterranean gas re-gained attention. “Israel, Egypt and Cyprus, because of their significant offshore gas reserves, make the Eastern Mediterranean region a strategic partner for the EU in its effort to diversify its gas supply routes”, the EU said. However, that enthusiasm was soon hit by a sad reality: the political fragmentation of the region.
The war in Gaza is a reminder of the aboveground fragility of the region, which translates into a very high risk of doing business. In an era where there are no shortages of gas reserves around the world, companies would be easily forgiven if they decided to look elsewhere to allocate their limited capital and resources, especially as the energy transition accelerates.
In 2022, the IEA announced that the golden age of gas may soon be reaching an end before it had the chance to fully materialise as competition from green energy intensifies. While on a global level, this may be questionable. However, when it comes to the most eastern region of the Mediterranean, it may well be the case under existing circumstances which are unlikely to be reversed any time soon.
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