Dimitris Manolis told “Reuters”: By 2018-2019, gas from the east Mediterranean may find its way to Greece and to the rest of Europe.

“By 2018-2019, gas from east Med may find its way to Greece and through Greece to the rest of Europe, providing diversification and security of supply as well diversification of routes,” Interconnector Turkey-Greece-Italy pipeline (ITGI) director of international activities Dimitris Manolis told “Reuters” at an energy conference in Vienna. “The new fields in eastern Mediterranean – Tamar, Leviathan and Block 12 – are three of the (world’s) top five largest discoveries of the decade,” he added.

“Despite technical difficulties, the construction and operation of such a pipeline is doable,” Manolis said, adding that the project’s technical feasibility had been confirmed by projects with similar characteristics, such as the Medgaz pipeline between Algeria and Spain and the Galsi pipeline between Tunisia and Italy.

The ITGI project lost the tender to carry Caspian Sea natural gas to Europe published by the Shah Deniz II Consortium, headed by BP plc (NYSE; LSE: BP) and Norway’s Statoil ASA (NYSE: STO; OSE: STL), which selected Nabucco West pipeline and the TAP project. “Reuters” notes that pipeline projects such as ITGI are hot topics as Western European users seek to reduce their dependency on Russian gas supplies. ITGI is an upgrade and extension of existing gas connections which should cost around €1.25 billion euros ($1.6 billion) and be ready by 2015.

“Reuters” says that the new fields in the eastern Mediterranean, with proven reserves of around 940 billion cubic meters of gas, enough to meet Europe’s gas demands for over 18 months.

Manolis said that Greece’s state-controlled DEPA, Texas-based Noble Energy Inc. (NYSE: NBL), Israel’s Delek Group Ltd. (TASE: DLEKG) and the Cypriot government had looked at whether building such a pipeline to transport eastern Mediterranean supplies was possible.

ITGI’s main partners are DEPA, Italy’s Edison SpA (BIT: INV), and Turkey’s Botas Petroleum Pipeline Corporation.

“Reuters” said, “Developing gas production and exports in the eastern Mediterranean will pose technical and political difficulties as the waters between Israel, Cyprus and Greece are among the deepest in the Mediterranean Sea.

“While cooperation between Israel and Cyprus works well, with the two governments having joint exploration agreements, experts say developing Israel’s and Cyprus’s gas fields will be further complicated because of deeper regional conflicts.

“Analysts have said it would be easier to run a pipeline from Cyprus to Turkey, but political disputes over the division of Cyprus have so far prevented joint development. The Turkish government has said any Cypriot gas revenues would have to be shared with Turkish-speaking northern Cyprus. Turkey does not recognize the Republic of Cyprus, which along with the European Union does not recognize northern Cyprus. “Additionally, the Lebanese government has said that some of Leviathan’s gas may be in its waters, a claim Israel rejects.”

Published by Globes [online], Israel business news - www.globes-online.com - on September 12, 2012