Gas finds put spotlight on an old crisis

Cyprus, the little problem in the eastern Mediterranean that the world would rather forget, surfaced again recently in a dispute over who controls potentially rich natural gas fields offshore from the divided island.

That division resulted from an invasion by Turkish forces 38 years ago in support of the Turkish minority in Cyprus and to stop a possible attempt to unite the island with Greece. A ceasefire was negotiated that left Turkey in control of roughly one third of the country and there, despite numerous attempts at a resolution, the situation has rested.

Complications have been created by the proclamation of the Republic of Northern Cyprus – an entity recognised only by Turkey - and Cyprus’ entry into the European Union. Brussels has made it clear that any progress on Turkey’s own long held ambition for EU membership is contingent on a settlement on Cyprus. For the Government in Nicosia, that settlement must include Turkish withdrawal and reunification, albeit with guarantees and some autonomy for the Turkish Cypriots.

Any resolution would also have to take into account demands by the Greek Cypriots who fled their homes in the north that they recover their property. The Government of Northern Cyprus has made a good income from selling these dwellings to wealthy Europeans as holiday and retirement homes. A settlement will depend on a ruling of who owns what and what compensation should be paid.

Opinion is divided over whether the latest gas finds will bring the two sides together or exacerbate tensions. An American company, Noble Energy, based in Houston, is leading the exploration along with Israeli partners. So far the consortium has been dealing only with the Greek Cypriot Government which considers it has the sole right to issue drilling licences

This is now contested by the northerners, backed by Turkey, who say they also have a claim on the waters surrounding the island. They have demanded the consortium stop drilling and that Nicosia put a freeze on issuing licences.

The United Nations, which has manned a buffer zone between the two parties since 1974 is hailing the gas discoveries as a wealth generator that could help solve the compensation problem and lead to reunification. Less optimistic observers see them as just another resource to be squabbled over with the United States and Israel now also involved. Only time will tell who is right.