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Wednesday, 23 September 2020

EastMed Gas Forum charter signed by founding members

Egypt takes a major step towards its regional energy hub ambitions with the formalization of the EastMed Gas Forum: The Eastern Mediterranean Gas Forum is now officially an established organization headquartered in Cairo after six of the seven founding states signed its charter yesterday, marking another key step in Egypt’s path to becoming the region’s premier energy hub, according to a cabinet statement. The organization will serve as a market platform for natgas producers, consumers, and transit countries in the region to develop existing resources and develop the infrastructure for future exploitation, in addition to regulating natgas policies in the region that protect the rights of member states to preserve their resources, the signatories said in a joint statement after the online ceremony. The seventh member, Palestine, did not attend the ceremony but will sign at a later date.

How is this all going to happen? Through the forum, member states will exchange information and seismic data studies on potential gas wells and delineate new gas finds that straddle maritime borders, Medhat Youssef, former chairman of Egyptian General Petroleum Corporation tells Enterprise. Member states could even get preferential rates on each other’s gas supplies, as well as preferential access to liquefaction facilities, he said.

The forum is already looking at growing its mandate beyond natgas exploitation to potentially cover electricity and renewable energy, Cypriot Energy, Commerce, and Industry Minister Natasa Pilides told reporters.

Who’s in? In addition to Egypt, the founding member states are Greece, Cyprus, Italy, Israel, Jordan, and Palestine. France had formally requested to join the forum as a member while the US asked to be a permanent observer. Private and public sector companies will also be included as members of an advisory committee, although it was not made clear whether the committee would only include companies from member states.

The door is not yet closed to others who want to join — ahem, Turkey: Other countries can apply to join “as long as their goals match those of the forum,” Oil Minister Tarek El Molla said. The forum is not designed to gang up against any other players and is instead meant to create a coalition that works together “without causing problems,” Egypt’s ambassador to Cyprus Mai Khalil said. Turkey signalled earlier this week that it is willing to make peace and become a member of the forum, rather than be left out in the cold. Greek Energy Minister Kostis Hatzidakis encouraged the forum earlier this year to bring Turkey into the fold, provided Ankara respects international law.

Background: The charter has been in the works since the forum’s first launch meeting last year, in which the founding members agreed to move ahead with creating a regional market to develop the eastern Mediterranean’s estimated 122 tn cubic feet of gas reserves.

The meeting hasn’t escaped the attention of the foreign press, with Bloomberg, Reuters and the Times of Israel picking up on the story.

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