By Roudi Baroudi

Lebanon, Beirut – 07/01/2026

January 1 marked a watershed moment for Cyprus, the first day of a six-month stint in the rotating presidency of the European Union that will give the tiny island nation massive influence, not just over the current agenda, but also the future direction of the entire EU and the destiny of the Eastern Mediterranean region.

The real significance of the moment lay not in the position itself, though, nor even in the considerable (but temporary) increase of Nicosia’s raw political power. In fact, this is not even the first time that Cyprus has held the presidency; that came in the second half of 2012.

Instead, what makes this time different is that a) the Cypriot leadership has laid out a highly ambitious agenda, one designed to generate recurring benefits for both the EU and its Mediterranean neighbors; b) regional circumstances cry out for precisely the kind of engagement that Nicosia envisions; and c) Cyprus today is far better-equipped to advance its politico-diplomatic goals than it was in 2012, not just because its economy and finances are in better shape, but also because it is now on the verge of becoming become an oil and gas producer and exporter. If well-managed, this latter point figures to drive growth for decades to come, enabling historic investments in education, healthcare, transport, and other drivers of greater economic competitiveness and better living standards, not to mention greater ability to influence – and stabilize – the surrounding region.

None of this has happened overnight. Geography and history have situated Cyprus – both literally and figuratively – athwart what is both our planet’s most long-lived maritime trade route and its most famous crossroads of different languages, cultures, faiths, and ethnicities. The island’s copper and other resources have always had their own attractiveness, rising or falling in value depending on the period, but it was location – specifically its proximity to each of Asia, Africa, and Europe – that made Cyprus a strategic prize for millennia, and that same location gives it enormous potential today.

None of this has happened overnight. Geography and history have situated Cyprus – both literally and figuratively – athwart what is both our planet’s most long-lived maritime trade route and its most famous crossroads of different languages, cultures, faiths, and ethnicities. The island’s copper and other resources have always had their own attractiveness, rising or falling in value depending on the period, but it was location – specifically its proximity to each of Asia, Africa, and Europe – that made Cyprus a strategic prize for millennia, and that same location gives it enormous potential today.

For decades, the centerpiece of this toolkit has been a foreign policy which seeks friendly relations with as many countries – especially neighboring ones – as possible. And it has worked. Both during and since the Cold War, for example, Nicosia has been able to maintain working relationships with governments on both sides of the East/West divide, and its search for neutrality has been equally assiduous on the Arab-Israeli front. By habitually staking out the middle ground, Cyprus has not only insulated itself against most external problems, but also steadily burnished its bona fides as a helpful player on the international stage.

All of this helped, but it was not enough. Try as Cyprus might to parlay its neutrality into tangible benefits at home and abroad, its economy remained fragile and unbalanced, distracting and undermining the freedom of action of successive governments. After its banks had to be rescued with EU bailout funds in 2012-2013, support began to grow for reforms that would prevent future meltdowns, restore the stability of the financial services industry, and rebuild its ability to finance private and public activities alike.

By the time President Nikos Christodoulides took office in early 2023, Cypriots of all persuasions were fed up with “business as usual”. Because he had run as an independent and attracted support from a broad cross-section of society, he had a strong mandate to make sweeping changes, and these have included an increase in the minimum wage, income tax cuts for working people, more effective financial regulation, and a far-reaching program for digital transformation. His administration also has run a tight fiscal ship, dramatically reducing public debt (from 115% of GDP in 2020 to a forecast 65% for 2025) and thereby making more credit available to the private sector. As a result, Cyprus’ sovereign rating was upgraded by all three of the major credit rating agencies in 2024, and as of this writing, two of them regard its outlook as positive, while the third views it as stable.

At the same time, Christodoulides’ background as a professional diplomat has empowered him to focus closely and effectively on foreign policy, recognizing its capacity to help shield the island against exogenous shocks, shore up the stability required to pursue its domestic social and economic development goals, and restore regional stability in the aftermath of the war in Gaza. It is no surprise, therefore, that his government has been at the center of international efforts to assist Palestinian refugees affected by the conflict, making Cyprus the staging ground for a vital flow of relief supplies.

Earlier this year, Christodoulides also teamed up with his Lebanese counterpart, President Joseph Aoun, to make sure their respective negotiating teams finally concluded a long-awaited maritime boundary agreement. The MBA clearly defines who owns what on the seabed, making both countries’ offshore hydrocarbon sectors more attractive, especially to the major oil and gas companies whose capabilities will be required to explore, develop, and extract the resources in question. Nicosia and Beirut are considering several other agreements as well, including ones that would expand cooperation in electricity and other fields, but the MBA was crucial because of the doubts it removed and the doors it opened.

All of these factors are steering the entire Eastern Mediterranean region to what can only be described as its “Cyprus moment”: the day when this miniscule country finally rises to its full stature as an exemplar of effective governance at home and a voice for peace and prosperity abroad. By some measures, this moment has already arrived, but the first exports of Cypriot natural gas to the European mainland will leave no doubt, and those are currently planned for late 2027.

Some say that timeline will be difficult to meet, but the positive effects are already being felt, and historians looking back will rightly regard the precise start state as a footnote. The economy has responded well to treatment, growth is expected to average 3% for the next couple of years, and diversification is already under way, including a variety of technology-related businesses that are helping to reduce the island’s traditional reliance on tourism and construction.

Most importantly, the buzz generated by offshore hydrocarbons has attracted the attention of international investors, and they like what they see: in addition to its prime location and increasingly sophisticated workforce, Cyprus also offers some of the EU’s most favorable tax conditions, strong investment protections, and a common law legal system modeled on the United Kingdom’s, making it more familiar and easier to use for many outsiders. The result? Over the past few years, hundreds of companies have relocated to Cyprus, including some 270 in 2024 alone, adding at least 10,000 new jobs to the island’s economy.

When gas production starts adding extra motive force to the economy, even more opportunities will open up. The advent of domestic energy production will not only spur employment both directly and indirectly, but also reduce the country’s need for expensive energy imports, and put downward pressure on domestic energy prices across the board, imparting a key competitive advantage on the entire economy. If all goes according to plan, this would be just the beginning, because while the savings and security enabled by production will be significant, the really lucrative next step will be exports, and Western Europe – the world’s hungriest energy market – is right next door.

As luck would have it, one of the island’s first commercially operational undersea gas fields figures to be Cronos, which lies within easy distance of existing Egyptian infrastructure, meaning its production can be easily piped to the Egyptian processing facility at Damietta and then delivered to European customers by LNG carrier. Nicosia’s plan is for this flow to begin in 2027, but again, that is just the beginning: Cyprus also expects the nearby Aphrodite field to be a major money spinner, and the plan there is to install a Floating Production Storage and Offloading Unit directly above the deposit. This would enable both dry gas shipments for use in Egypt and further production of LNG for export further afield.

In the longer term, other streams are under consideration as well, including undersea pipelines to Greece, Italy, and/or (one day) even Turkey, and possibly a fully fledged liquefaction plant onshore that would be far and away the largest infrastructure project in Cypriot history. The investments being made and planned now are expected to fundamentally alter the path of Cyprus’ economic and social development. What is more, if and when the time comes, the same infrastructure could also be used to help neighbors like Lebanon and Syria, both of whose coasts are less than 100 nautical miles away, to get their own gas to market. That could be crucial in enabling both of those countries to start recovering and rebuilding after decades of stagnation, and like Cyprus itself, the EU at large has a vested interest in seeing peace and prosperity spread across the Levant.

These and other factors give Cyprus’ strategy a level of importance that goes beyond the purely national. Gas exports to Europe also will help increase the EU’s energy independence, for example, further reducing continuing dependance on Russian energy supplies, and strengthening Europe’s position in any negotiations over the situation in Ukraine. An LNG plant also would make affordable primary energy supplies available to several African countries, enabling them to pursue the electrification strategies they need to modernize their own economies. Again, Europe has countless reasons to want a stabler, happier Africa on its doorstep, beginning with the fact that this would automatically reduce the flow of undocumented migrants making their way across the Med.

The Cypriot approach is nothing less than inspiring, especially since it springs from the very same wells of good will, good governance, and good sense that inspired the Barcelona Declaration more than 30 years ago. The EU envisioned by Barcelona, a strong and cohesive bloc closely integrated with vibrant neighborhoods in the MENA region, has been long-delayed by the collapse of what was then a promising Israeli-Palestinian peace process, and some countries have largely given up on that dream.

Clearly, Cyprus is not one of those countries. Instead, it has wagered on cooperation, weaving good governance and sensible diplomacy into a bold and hopeful venture.

No longer is Cyprus just a sunny little island filled with charming holiday homes and ringed with the Mediterranean’s cleanest beaches; now it is also going to be a regional energy hub, a magnet for international investment, a docking mechanism to help its non-EU neighbors access European markets, and a catalyst for EU dialogue and engagement with Africa and Asia. In short, the country has refashioned itself into the ultimate “project of common interest” – a venture that serves so many useful purposes, both inside and outside the bloc, that it verily demands support from Brussels.

The before and after contrast is increasingly striking. Once a fragile neophyte dependent on handouts from Brussels, today’s Cyprus has transformed itself into the very model of a Euro-Mediterranean country envisioned by the Barcelona process: a hopeful, peaceful, and universally useful land whose success promises only more opportunities for its friends and neighbors.

Cyprus: The Euro-Med region’s ultimate ‘country of common interest’ is about to have its moment            

Following criticism of the Lebanon-Cyprus Maritime Boundary Agreement (MBA) by the governments of Israel and Turkiye, LebTalks spoke with energy and policy expert Roudi Baroudi, who has authored several books and studies on sea borders in the Eastern Mediterranean. Baroudi praised the pact as “full of positives” for the interests of both parties and stressed the words of Lebanese President Joseph Aoun, who pledged after signing the MBA that “this agreement targets no one and excludes no one.”

LebTalks: How significant is the signing of the maritime boundary agreement between Lebanon and Cyprus?

RB: The official signing of the Lebanon-Cyprus deal is a major achievement, one that confers important advantages on both parties. This process was delayed for a very long time for no good reason, so President Joseph Aoun and the government deserve congratulations for having seized the initiative, and for having seen the job through to completion. So do Cypriot President Nikos Christodoulides and his team, because they did the same thing. What made this historic agreement possible – after an impasse lasting almost two decades – was that Lebanon finally had a president who both understood the need for an MBA and made achieving it a top priority.

LebTalks: What does Lebanon gain by signing this deal?

RB: The agreement, which was reached by the negotiating teams in September, provides several benefits for both countries in the short, medium, and long terms.

The new equidistance line between the two states, defined according to the rules and guidelines of the United Nations Convention on the Law of the Sea (UNCLOS), provides a fair and largely uniform boundary between the two brotherly countries’ maritime zones. Most of the new turning points used to draw the line have moved in Lebanon’s favor compared to the earlier negotiation in 2011, giving it an extra 10,200 meters on its western front while Cyprus received 2,760 meters.

Crucially, the MBA wipes away all overlapping claims caused by previous uncertainty over the precise location of the border. Accordingly, this eliminates 108 km2 of (map attached) Lebanese offshore blocks that were actually in Cypriot waters, as well as 14 km2 of Cypriot blocks which were also on the wrong side of the line.

Apart from removing a key risk for would-be investors, the agreement also contributes to stability and security by providing clarity and thereby enabling easier cooperation, not just bilateral, but also, potentially, involving other states as well. It really is full of positives for both Lebanon and Cyprus, and therefore for the region as a whole.

LebTalks: What should Lebanon do to follow up on this agreement?

RB: To make the most of this clearer playing field, the logical next step is for Lebanon and Cyprus to immediately start drafting a joint development agreement, which would allow them to have a smooth partnership in place for any hydrocarbon reserves which are found to straddle their maritime boundary.

Perhaps the most important feature of the Lebanon-Cyprus MBA is that it provides a clear and stable starting point, putting Lebanon in ideal position to finish defining its maritime zones. The new line means that Lebanon’s existing maritime boundary arrangements with Israel, signed in 2022, should be tweaked a little, but it also makes it easier to do that – and to negotiate a similar agreement in the north with Syria when that country’s new leadership is ready to do so.

LebTalks: What about the objections voiced by Irael and Turkiye?

RB: With all due respect, these claims and complaints are completely baseless. As President Aoun has stressed from the very day it was signed, this accord targets no one, excludes no one, challenges no one else’s borders, and undermines no one else’s interests. I know there has been some negative commentary from both Israel and Turkiye, but there really is nothing here for anyone to be upset about. The line agreed to by Lebanon and Cyprus, which Turkiye has claimed is ‘unfair’ to residents of the self-styled ‘Turkish Republic of Northern Cyprus’, is literally several kilometers away from any waters claimed by the TRNC. Beirut and Nicosia were very careful to make sure of this.

As for the Israelis, the only material change relating to the Lebanon-Cyprus line is that it pushes the Israel-Cyprus line in Cyprus’ favor. But that’s not Lebanon’s fault. Or Cyprus’ or anyone else’s. It’s just a fact of new mapping technologies, which today are far more precise and more accurate than those used when the Israel-Cyprus line was drawn in their 2011 treaty.

On that subject, I would also note for all stakeholders in the East Med that while Lebanon and Cyprus are the region’s only full-fledged members of UNCLOS, all states are subject to its rules and precedents, which have become part of Customary International Law. Since the Lebanon-Cyprus deal adheres strictly to those rules and the science behind them, the criticisms haven’t got a legal leg to stand on. This is especially true with regard to Israel, whose own treaty with Cyprus was negotiated on the basis of the very same laws, rules, and science.

I have to assume that a lot of this is posturing, that both Israel and Turkiye will settle down once they’ve had more time to analyze the deal and see that, far from damaging them in any way, it could help all concerned by contributing to regional stability and economic growth. And again, I would go back to Aoun’s words on signing day, when he declared that “this agreement should be a foundation for wider regional cooperation, replacing the language of violence, war, and ambitions of domination with stability and prosperity.”

تبدو العلاقات اللبنانية القبرصية في حال تطور سريع وقد فتح هذا الباب رئيس الجمهورية العماد جوزاف عون فلاقى استجابة ورغبة عارمة لدى نظيره القبرصي كريستو دوليديس تجاه تطوير العلاقة بين البلدين الجارين وما لفت أن الرئيس القبرصي هو الذي بادر وطرح على الرئيس عون استجرار الكهرباء من قبرص إلى لبنان وقد تلقف رئيس الجمهورية اللبنانية هذه المبادرة وطلب من وزير الطاقة جو صدي متابعة الموضوع.

وفي هذا السياق أثنى خبير الطاقة الدولي رودي بارودي على مبادرة الرئيس القبرصي واللبناني، مؤكّدًا وجوب الترحيب بأي خطوة من هذا النوع باعتبارها نقطة انطلاق مهمة لتأمين الكهرباء للبنانيين وحل أزمة القطاع المستفحلة جزئياً منذ عقود وأن هذه الخطوة تأتي بعد الإعلان عن استئناف مفاوضات ترسيم الحدود البحرية بين البلدين.
كما أثنى بارودي على الدور الذي يلعبه الرئيس عون في ملف الطاقة ككل واعتباره أولوية لما فيه من فائدة على الاقتصاد وتعزيز القدرات الاجتماعية للمواطنين اللبنانيين.

ولفت بارودي إلى أن هذه الخطوة ستتيح تزويد لبنان ما بين 150 و300 ميغاواط وفق مراحل متعددة ولا سيما بعد عام أو عامين على الأكثر عندما تبدأ قبرص بإنتاج الكهرباء من الغاز المستخرج من حقولها البحرية خاصة حقل كرونوس الذي يديره كل من شركتي ENI & TOTAL ENERGIES ما يعزز تنويع مصادر الطاقة وبأسعار مقبولة لا سيما وأن الحقل المعني في قبرص لا يبعد عن حقل زهر المصري سوى ٦٠ كلم ما يعني أن كلفة الإستخراج ستكون مماثلة لتلك المعتمدة في الحقل المصري وهي كلفة رخيصة نوعا ما.

ولفت بارودي إلى وجود محطتين رئيسيتين لإنتاج الكهرباء في قبرص، إحداهما بين لارنكا وليماسول، والأخرى في Vassilikoبين ليماسول وبافوس، بقدرة إجمالية تقار ب 1600 ميغاواط من دون الكهرباء المنتجة من الطاقة الشمسية وبالتالي يمكن للبنان الاستفادة من هذه الطاقة بكلفة يتم التوافق عليها موضحا أن الكلفة ستكون اقل بكثير من كلفة الكهرباء المنتجة في لبنان عندما تبدأ قبرص العام المقبل باستخدام الغاز المستخرج من حقولها البحرية لإنتاج الكهرباء ولاسيما البلوك رقم 6.

بارودي طالب الحكومة اللبنانية بالإسراع بوضع الأطر الإصلاحية والتنظيمية للقطاع بشأن استجرار الكهرباء من قبرص وبإعداد دراسة جدوى اقتصادية تأخذ في الاعتبار كلفة الاستجرار ولفت أن محطة Vassiliko هي المحطة التي تصدر الغاز في 2026، على أن يواصل لبنان مساعيه لربط شبكته بالشبكة السورية للحصول على دعم إضافي كهربائي عن طريق محطة دير نبوح، بما في ذلك محطة الكسارة في منطقة البقاع.

Most of the world is watching and waiting, hoping and/or praying that a hastily arranged ceasefire between Israel and Iran will hold. If it does, there will be sighs of relief virtually everywhere; if it does not, the State of Qatar should still be considered for the Nobel Peace Prize.

Yes, you read that correctly: even if the ceasefire that it helped to secure falls apart, Qatar should be considered for what many regard as the most prestigious prize on Earth.

I believe this because peace is more important than any other cause on Earth, and pound-for-pound, no country does more than Qatar to promote peace. Peace is more than a photo opportunity, more than a process that often allows belligerents to let their guns fall silent, more even than the gratitude of those whose lives and livelihoods are spared. It also serves other useful purposes, too, including as a commodity that promotes stronger growth and better socioeconomic development, and frees up resources for investment in education, healthcare, and transport infrastructure. Accordingly, achieving peace means more than simply not being at war: it means having the chance to better one’s own situation by leaps and bounds. By extension, anyone who provides such a chance to anyone else deserves deep admiration.

By this measurement alone, Qatar’s case for a Nobel is rock-solid – and has been for years, long before the world’s most powerful county asked it to obtain Iranian consent to a ceasefire. A quick glance at Qatar’s track record reveals a foreign policy focused almost entirely on the peaceful resolution of differences. Over the past quarter-century, Qatari diplomacy has helped to resolve or mitigate multiple crises, disputes, and conflicts in too many places to count, including Afghanistan, Darfur, Gaza, Eritrea, Iraq, Lebanon, Russia and Ukraine, Sudan and South Sudan, and Yemen. These feats have included the winding down of one all-out civil war and the prevention of another, the brokering of several exchanges involving thousands of prisoners/hostages, the securing of temporary cease-fires, the resolution of dangerous constitutional deadlocks, and – most importantly – the kindling of hope in the hearts of millions.

Not surprisingly, Qatar’s diplomatic corps is almost constantly and relentlessly engaged in one form or another of peacemaking. It does not always succeed, but its investments – both political and financial – in this mission pay dividends in other ways, too. Repeated successes are their own reward, but even “failure” both raises Qatar’s profile and reaffirms its commitment to dialogue and peace. In addition, both the leadership and the professional diplomats learn important lessons from each and every engagement, making Qatari intervention increasingly effective over time. Just as importantly, this increasing effectiveness contributes to Qatar’s growing reputation as an honest and capable broker, and that perception gives it still more influence, leverage, and flexibility going forward.

There are critics, of course. Many American officials, for instance, have criticised Doha for maintaining friendly relations with entities such as Hamas, the Taliban, and, indeed, the Islamic Republic of Iran. But when Washington and Paris wanted to end the presidential vacuum in Beirut, they turned to Qatar and other brotherly nations, which then helped to gain the acquiescence of Iran and Hezbollah. When Washington wanted to negotiate the release of Israeli soldiers and civilians held in Gaza, it was Qatar that made it happen. When the first Trump administration wanted a negotiated exit from Afghanistan, it was Doha that made the contacts and hosted the talks. And when the current Trump administration decided it was time for Israel and Iran to end hostilities, it was the Qataris who delivered the Iranians – and this despite the fact that Iran had just retaliated against US air strikes by lobbing missiles at a US air base inside Qatar!

In effect, the peninsula is now a platform for peace promotion, and not by accident. As impressive as they are, even Qatar’s obvious enthusiasm and evident aptitude for dialogue and diplomacy cannot account for the unprecedentedly large role it has come to play on the world stage.

Instead, today’s Qatar is the product of a bold strategy rooted in both purpose and principle. Led by His Highness the Amir Sheikh Tamim bin Hamad al-Thani, the country’s entire leadership views respect for international law and the maintenance of international peace and stability as existential objectives for Qatar and its population.

The Amir inherited some of this strategy from his father, but he has expansively built on it, adding both breadth of vision and depth of commitment. Even – and perhaps especially – when this approach has carried dire risks, His Highness the Amir has refused to waver, and his steadfast pursuit of fraternal relations among nation-states has continued. That resolve has been noted by state and non-state actors alike, and some former antagonists have even come to embrace and even emulate much of the Qatari approach.

That’s why Qatar deserves the Nobel Peace Prize. Not because it helped end a war between Iran and Israel, but because no other country is so singularly dedicated to peace. It’s the ideas behind its actions that make them special: that a country should not only refrain from seeking out conflict, should not only keenly avoid conflict unless necessary, but should also actively seek to prevent, shorten, and/or mitigate conflict among other countries as well.

What could be more noble – and therefore more Nobel-worthy – than that?

• Roudi Baroudi is an energy and policy expert with more than four decades of experience in both the private and public sectors. The author of several books, he currently serves as CEO of Energy and Environment Holding, an independent consultancy based in Doha.

The extreme heat that’s been scorching Asia in recent weeks has produced one clear beneficiary — Russia.

As countries across the region scramble to make sure they have enough coal, gas and fuel oil to keep the lights on and air conditioners running, Russian energy being shunned by the West is looking increasingly attractive.

What began as a push from the Kremlin to fund its invasion of Ukraine has now turned into a pull from Asian economies anxious about making sure their power generators are supplied with enough fuel in what could be the hottest year on record.

“The worst place to be right now amid these searing temperatures is South Asia, especially poorer nations like Pakistan or Bangladesh,” said John Driscoll, director of JTD Energy Services Pte in Singapore.

“When you can’t even take care of your people’s basic needs, it’s very hard to care too much about international affairs.”

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Russian exports to Asia of thermal coal and natural gas, the two fuels most often used for electricity generation, have grown markedly this year, figures from data intelligence firm Kpler show.

Coal volumes jumped sharply to 7.46 million tons in April, about a third higher than a year earlier. Shipments of liquefied natural gas to Asia have also been growing in recent months after prices retreated from record highs that had made the fuel unaffordable for many poorer nations.

Meanwhile, Asian imports of Russian fuel oil, a dirtier and cheaper alternative for power generation, had the two highest months on record in March and April, according to Kpler.

The impetus for the region to buy more Russian energy is likely to increase due to an emerging El Niño weather pattern, which has already sent the mercury soaring in parts of the region. Vietnam’s prime minister has warned of power shortages this month, while Myanmar is struggling with worsening blackouts.

Carbon dioxide emissions from burning fossil fuels are trapping heat in the atmosphere. That’s warming the planet and is the primary driver of more extreme weather events, including heat waves.

In India, heat-driven power demand will likely be satisfied mostly by coal, said Aniket Autade, power fundamentals analyst for Rystad Energy.

Read More: A Billion Air Conditioners Will Save Lives But Cook the Planet

China and India — the most enthusiastic buyers of discounted Russian oil — are also purchasing the most coal, gas and fuel oil. They took more than two-thirds of Russian coal sent to Asia last month, according to Bloomberg calculations based on Kpler data. South Korea, however, scooped up 15% of the shipments, while Vietnam, Malaysia and Sri Lanka have also emerged as significant buyers.

For fuel oil, China and India were again the biggest buyers from Russia, with Saudi Arabia and the United Arab Emirates also major importers, the Kpler figures show.

Bangladesh, Pakistan and Sri Lanka will probably import more Russian fuel oil for power generation, according to Emma Li, an analyst with Vortexa. The Middle East has also recently increased its imports, and that’s likely to continue over the summer, she said.

Pakistan said this month it was keen to pay for Russian oil imports with the Chinese yuan. The country has has placed an order for a single cargo of the crude, but is keen for a long-term deal to buy it in Chinese currency, its power minister said.

Even Japan, a close ally of the US and therefore reluctant to increase imports from Russia, might expand buying within contractual limits, according to Chris Wilkinson, senior analyst for renewables at Rystad.

“Japan may consider purchasing more LNG from Russia under its existing long-term contracts, as it is more cost-effective than buying on the spot market,” he said.

For JTD Energy’s Driscoll, the increasing purchases of Russian energy by many Asian countries highlights both the White House’s declining clout and the perilous situation many nations find themselves in.

“[They] are asking themselves: would I rather risk falling afoul of the US or forgo steep discounts on energy?,” he said. “When there’s a good deal on the table, how can poorer nations afford to say no?”

— With assistance by Aaron Clark

When European countries want to decommission aging nuclear plants, they often call Nukem. There’s only one catch.

There is not much Qatar can do to alleviate Europe’s gas crisis in the short term due to contractual commitments, Qatari Energy Minister Saad al-Kaabi tells Energy Intelligence — but further out, in five to seven years, new Qatari LNG exports to Europe should be significant. In an exclusive interview, al-Kaabi said production from the Golden Pass LNG project in the US, where QatarEnergy partners with Exxon Mobil, is due on stream in 2024 and is “already earmarked for Europe.” Up to half of new output from Qatar’s 48 million ton per year North Field mega-expansion could also go West of Suez when it starts up from 2026. Al-Kaabi also serves as head of state-owned QatarEnergy, which is in active discussions with customers for the new supplies. Significantly, targeted contract durations are shorter than the 20-year deals seen in Qatar’s original LNG expansion, reflecting European reluctance to lock into gas supplies long-term. “I think 10-15-year deals are probably what are most acceptable to both sides. But for us, the long-term deal, it’s not just about duration, it’s about price,” he said. Even with such supplies, al-Kaabi expressed skepticism about Europe’s ability to completely wean itself off Russian gas. Europe will find it “very difficult” to completely forgo Russian pipeline gas for more than two winters. Despite storage, fuel switching and active efforts to expand LNG imports, “a quick fix” to the EU’s dependency on Russian gas does not exist.

Qatar’s North Field expansion is attracting enormous interest from foreign investors, with TotalEnergies tipped to become the first of the Phase-2 partners to be selected later this month. But investors in existing Qatari projects face a rocky ride when contracts on current joint ventures expire, as Exxon and Total discovered when their prized Qatargas-1 contract was not renewed last year. Al-Kaabi revealed that QatarEnergy came close to going it alone on the North Field expansion, too. Qatar, which is generating around 1 million barrels of oil equivalent per day of net output for Exxon, Total and Shell alone, is critical for the majors. However, “if there is no value, there is no partnership, very plain and simple,” al-Kaabi said. Even if joint ventures are maintained after expiry, terms will be tougher. For Exxon, which has stakes in nine of Qatar’s 14 trains, these contract renewals are especially strategic. Qatar knows the value of its LNG will likely drive a hard bargain. “An investment in Qatar is really an important downside-risk revenue maker” for partners, al-Kaabi said.

LNG is only part of a multifront, international investment drive now under way at QatarEnergy. Downstream, petrochemicals is a priority, with al-Kaabi touting QatarEnergy’s planned US project with Chevron Phillips Chemical as “the largest polyethylene plant.” It recently awarded construction contracts for a 1.2 million ton/yr blue ammonia project, also tipped to be the biggest of its kind. But its global upstream drive is most significant. There were doubters when the strategy launched, but QatarEnergy has been vindicated over the past year by major exploration success in Namibia. QatarEnergy, by virtue of sizable stakes in both Total and Shell discoveries, is poised to be the largest reserves holder in a significant new oil province — Total’s Venus discovery is described as the largest deepwater find ever. There have also been offshore gas discoveries in Cyprus and South Africa. And in Brazil, output at QatarEnergy’s offshore Sepia field is set to more than double to 400,000 barrels per day in the next couple of years.

Despite confidence in long-term gas demand, QatarEnergy is taking steps to ensure its place in the energy transition. It is investing heavily in greenhouse gas emission mitigation technology at projects. Over $250 million is being spent on such measures at the LNG expansion alone — principally carbon capture and storage (CCS) and solar power. Some 11 million tons/yr of CCS is planned by 2035. “From an overall value chain, Qatari LNG will be the least carbon footprint LNG you can get,” al-Kaabi said. “We think that our buyers, and our investors that have joined us in [North Field East expansion], see this as the Rolls-Royce of projects.” Transition pressures are feeding into the urgency for developing projects. “I am a believer that you need to monetize what you can because the market conditions change, and there is a competitive advantage to go ahead of others,” al-Kaabi stated.

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Sweden’s government will provide Nordic and Baltic utilities as much as 250 billion kronor ($23.2 billion) in credit guarantees as it seeks to prevent Russia’s energy curbs from setting off a financial crisis.

The measure is aimed at helping companies struggling to meet the surging collateral requirements needed to trade electricity, and avoid the threat of some going into technical defaults as soon as Monday, Finance Minister Mikael Damberg said at a news conference in Stockholm. Utilities registered with Nasdaq Clearing AB are eligible for the guarantees.

“The issue is currently isolated to energy producers, but unless we act, it could have contagion effects on the rest of the financial market,” the minister said on Sunday. “Ultimately, it could lead to a financial crisis.”

The surging price of energy in Europe has made it more expensive for utilities to buy and sell electricity, because of the collateral required to guarantee trades on power markets facing unprecedented turbulence. Fortum Oyj of neighboring Finland said Aug. 29 its collateral rose by 1 billion euros ($1 billion) in a week to 5 billion euros, excluding funds posted by its German subsidiary Uniper SE.

The German government yesterday unveiled a new multi-billion euro plan to help housesholds cope with soaring prices, and said it was eyeing windfall profits from energy companies to help fund the relief.
German businesses and consumers are feeling the pain from sky-high energy prices, as Europe’s biggest economy seeks to extricate itself from reliance from Russian supplies in the wake of Moscow’s invasion of Ukraine.
Rapid measures to prepare for the coming cold season will ensure that Germany would “get through this winter,” Chancellor Olaf Scholz said at the unveiling of the €65bn ($65bn) package.
The latest agreement, which brings total relief to almost €100bn since the start of the Ukraine war, was hammered out overnight into Sunday by Germany’s three-way ruling coalition of Scholz’s Social Democrats, the Greens, and the liberal FDP.
Among the headline measures are one-off payments to millions of vulnerable pensioners and a plan to skim off energy firms’ windfall profits. The government’s latest relief package came two days after Russian energy giant Gazprom said it would not restart gas deliveries via the Nord Stream 1 pipeline on Saturday as planned after a three-day maintenance.
The government had made “timely decisions” to avoid a winter crisis, Scholz said, including filling gas stores and restarting coal power plants. But preventative measures, including a drive to reduce consumption, have done little to break a sharp increase in household bills.
The latest announcement follows two previous relief packages totalling €30bn, which included a reduction in the tax on petrol and a popular heavily subsidised public transport ticket.
But with the expiration of many of those measures at the end of August and consumer prices soaring, the government has been under pressure to provide new support. Inflation rose again to 7.9% in August, after falling for two straight months thanks to previous government relief measures.
The take-off in energy prices is expected to push inflation in Germany to around 10% by the end of the year, its highest rate in decades. Scholz said however that not everyone is suffering from the high consumer prices.
Some energy companies which may not be using gas to generate electricity were “simply using the fact that the high price of gas determines the price of electricity and are therefore making a lot of money,” he said.
“We have therefore resolved to change the market organisation in such a way that these random profits no longer occur or that they are skimmed off.” The trimming of windfall profits would create “financial headroom that should be used specifically to relieve the burden for consumers in Europe,” the government said in its policy paper.
The move could potentially bring “double-digit billions” of euros in relief, finance minister Christian Lindner estimated in the press conference. The government said it would push for the move to be implemented across the European Union, before going ahead with the measure on its own.
Brussels on Monday said it would prepare “emergency” action to reform the electricity market and bring prices under control. Scholz said he expected the EU to “deal quickly” with the issue, adding that it was “very clear that we need rapid changes in this area”.
Repeating his mantra that Germans will “never walk alone” through the energy crisis, the chancellor unveiled a raft of measures, including a one-off payment of €300 to millions of pensioners to help them cover rising power bills.
The government will also target students with a smaller one-time transfer of €200, and an heating cost payment for people receiving housing benefits.
Berlin also set aside €1.5bn for work on a successor to the wildly popular nine-euro monthly ticket on local and regional transport networks. The relief package as a whole should be financed without planning to take on further debt, Lindner said.
“These measures are included within the government’s existing budget plans,” covering 2022 and 2023, he said, with the remainder covered by the windfall energy profit measures.