As Cyprus Collapses, It’s A Race To The Mediterranean Gas Finish Line…”Cyprus is preparing for total financial collapse”
by Jen Alic of OilPrice.comx`
Cyprus is preparing for total financial collapse as the European Central Bank turns its back on the island after its parliament rejected a scheme to make Cypriot citizens pay a levy on savings deposits in return for a share in potential gas futures to fund a bailout. In the meantime, cashing in on the island’s major gas potential is more urgent than ever—but these are still very early days. In the end, it’s all about gas and the race to the finish line to develop massive Mediterranean discoveries. Cyprus has found itself right in the middle of this geopolitical game in which its gas potential is a tool in a showdown between Russia and the European Union. The EU favored the Cypriot bank deposit levy but it would have hit at the massive accounts of Russian oligarchs. Without the promise of Levant Basin gas, the EU wouldn’t have had the bravado for such a move because Russia holds too much power over Europe’s gas supply. The Greek Cypriot government believes it is sitting on an amazing 60 trillion cubic feet of gas, but these are early days – these aren’t proven reserves and commercial viability could be years away. In the best-case scenario, production could feasibly begin in five years. Exports are even further afield, with some analysts suggesting 2020 as a start date.