Turkey Fires Back Over Noble Energy Deal with Cyprus

Turkish state media say Turkey and Turkish Cyprus have signed an agreement to facilitate oil and gas exploration in the Eastern Mediterranean. That could have ramifications for Houston's Noble Energy.

Noble Energy Map

The move follows a deal last week between the government of Cyprus and Houston’s Noble Energy for Noble to begin exploratory drilling for oil and gas off Cyprus’ southern coast.

Turkish Prime Minister Recep Tayyip Erdogan says Cyprus’ deal with Noble violates the rights of Turkish Cypriots. He warns that Turkey has sent warships to the area before the deployment of its research ship.

But Amy Myers Jaffe of Rice University’s Baker Institute says that alone shouldn’t scare Noble off.

“The fact that there is political risk is not necessarily a deal killer. You know, one has to assess if the political risk might lead to some kind of military action, and I would say in the case of the Levant, I think that’s less likely to happen.”

Jaffe says the natural gas fields off Cyprus’ coast likely extend south to waters claimed by Lebanon, Israel, and Palestinian Gaza. The lack of defined sea boundaries could slow further development of the region’s offshore resources.

Bio photo of Andrew Schneider

Andrew Schneider

Business Reporter

Andrew Schneider joined KUHF in January 2011, after more than a decade as a print reporter for The Kiplinger Letter...