... Russia has undertaken another geo-strategic gambit in the Eastern Mediterranean by boldly claiming a stake in a huge oil and gas field off Syria's shores. Last week, a Russian state-controlled energy group, Soyuzneftegaz, struck a deal with the Syrian regime for rights to develop and produce oil and gas off Syria’s coast.
Under terms of that deal, Soyuzneftegaz will be permitted to perform offshore drilling, development and production activities in Syria’s territorial waters. The agreement covers 2,190 square kilometers in the Mediterranean waters, at an initial cost of some $90 million, all assumed by Soyuzneftegaz. The contract will extend for 25 years.
In 2010, Houston-based energy company Noble Energy (NYSE: NBL) discovered a huge gas field off of Israel’s coast -- the largest natural gas find in the past 10 years. Gazprom and other Russian state-owned energy companies have looked to get a piece of the action. But so far, only Noble, Italy’s ENI (NYSE:E), France’s Total (NYSE:TOT), and even South Korea’s Kogas have been given the rights to explore in the area, known as the Levant Basin.
The Basin, which stretches from the coasts of Israel, Lebanon and Syria in the east to Cyprus in the west, has a mean undiscovered oil resource of 1.7 billion barrels of oil and an undiscovered natural gas resource of 122 trillion cubic feet. Both Cyprus and Israel are looking to become regional powerhouses through the export of oil and gas.
Now, Russia’s energy deal with Syria is more than just a potentially lucrative investment; it’s a political gambit that has far-reaching implications for the region.