Tuesday, August 20, 2013

"Ithaca" by C. P. Cavafis - An allegory of life (and business) ventures

Free translation of Cavafis poem “Ithaca” from Greek to English by Harris A. Samaras:

Ithaca
Constantinos P. Cavafis
(1911)

When you set out on your journey to Ithaca,
pray and hope that the road is long,
full of adventures and challenges, full of discovery and knowledge.
The Laestrygonians and the Cyclops,
the angry Poseidon, fear them not;
negligible fixations such as those you will never encounter on your path,
if your thoughts are high,
if a selective process that touches your mind and body dictates your every action.
The Laestrygonians and the Cyclops,
the fierce Poseidon you will never encounter,
if you do not carry them in your soul,
if your soul does not allow them to be set up before you.

Pray that the journey is long.
Many may the summer mornings be
when with pleasure and joy and rare excitement
you enter harbors for the first time;
may you stop at Phoenician markets,
not just to purchase fine merchandise,
mother-of-pearl and coral, amber and ebony,
and sensual perfumes of all kinds,
get as many hedonic perfumes as you can!
And may you visit many Egyptian cities
to acquire knowledge but learn from scholars and simple people alike.

But Always keep Ithaca in your mind.
To arrive there is your ultimate destination and goal.
But hurry not!
May the journey last for years and years
and anchor at the island an old man,
rich from all that you earned on your quest,
expecting not that Ithaca will ever provide you with riches.

Ithaca has given you this amazing journey.
Without Her you would not have set out.
She (Ithaca) has nothing more to give you.

And if you deem Ithaca poor, She deceived you not.
Wise as you have become, with all this experience,
you must by now have realized the true meaning of Ithacas.

Ithaca, the poem, is not just a story about a fantastic voyage and of a hero overcoming some imaginary or not difficulties on his way back home. It is an inner-self quest for rediscovering who you really are; at the same time it is a celebration of the human nature and the capability of achieving your goals, even if it means that you have to go through the most difficult and unexpected obstacles to reach those goals.

It is the journey not the destination that matters most in ones quest for life, says Cavafis with aesthetism and skepticism! Parabolizing from Homer’s Odyssey, Cavafis expresses through myth, allusion and symbolism that most important in life is the experience acquired from the journey of life and not necessarily just reaching the ultimate single goal. If one allows self to ignore those encounters that are only negligible fixations imposed by society’s status quo; if one challenges the status quo with wisdom and an open mind; facing life without fear, avoiding the frayed and stereotyped; exploring life to the fullest… then this person will be truly rich… this person would have lived and “tasted” life to the fullest!

Entrepreneurship is no different! An excelling entrepreneur and businessman or businesswoman will have to understand life if he or she is to be successful: One will have to enrich his or her critical thinking and thought leadership skills if he or she is to answer the “whys” and the “whynots”, the “cans” and the “cannots”, the “hows” and the “hownots”, the “whatifs”. How else can you achieve your business goals unless you are a true explorer of life? How could you even understand what your business goals are or should be if you do not understand life?Life should not be wasted in always contemplating the goal of one’s endeavors or in building up hopes and schemes for the future but in enjoying the journey, gaining from the journey. An obsession with the final goal can blind a person to the real business of living, which is to enjoy and explore every minute that is available.

Life at times can be disappointing. The goals people strive for, their Ithacas, may not yield what they hoped for. Therefore, it is better not to have fixations. There may be no pot of gold at the end of the rainbow. Ithaca may be poor, with nothing to give. A person should not have the type of lofty ideals that society imposes and considers success. Yet, it is human to have ambitions and expectations, and one must have, to strive to explore and achieve. As the poet states, without having an “Ithaca,” a goal, in mind, there would be no reason to act at all, no reason to embark on a journey…
All of us set ever-changing goals that we want to achieve in our lifetime and we strive or not hard throughout our lives to reach these goals. As a result, we can all relate to our hero’s quest to reach Ithaca as being our own journey of life, to reach the goals we set before we start this long voyage. Just like Odysseus, we will all face difficulties, temptations and problems while we try to achieve what we want. The question is whether we have the strength and patience to remain focused on achieving these goals when we come face to face with the extreme difficulties of personal and business life alike – using all the resources of senses and intellect – just like Odysseus finally made it and reached his Ithaca.

What happens if we do not achieve all our goals when we finally reach our Ithaca? Should we be considered unsuccessful? Should we feel that we have failed in our lives or business venture? The answer is clearly “No”. The actual objective lies in making the voyage itself, and to face all those difficulties; to overcome them and gain experience while we are out making the voyage. By the time we reach our Ithaca we will already have gained so much from the trip that whether we reach our goals or not becomes of secondary importance.
The poet has a recipe for enjoying the journey that involves the cultivation of a certain habit of mind. The whole person – body, mind, spirit, even soul – must be fully alert and engaged in the life it is living. A person must keep his or her “thoughts raised high,” which means that the mind must not give in to melancholy or disappointment or the sordid aspects of life. The poet in his own unique way highlights the contemplation of art, which leads the mind to the higher levels of the human spirit, rather than allowing it to sink to abyssal depths.

Another prerequisite for happiness and content on the journey is what Cavafis calls “rare excitement.” This might be explained as a certain attitude to the experiences that life produces. A person must cultivate the ability to respond to situations and experiences as if they were entirely new and fresh, never before seen, and therefore an object of wonder and delight. The opposite would be to respond in a tired, mundane way, influenced by habit and custom, or by the polarized elements of society.
The last part of the recipe for a fulfilling journey is to enjoy the sensual aspects of life (“as many sensual/hedonic perfumes as you can”), to value beautiful things (symbolized by the precious stones), and to cultivate the intellect. The latter is suggested by the advice to learn and “go on learning” from the scholars in Egypt. The way this is phrased is significant. A person can never say that he or she has learned enough. Learning is an ongoing process with no final end in sight.

The advice given throughout the poem could be summed up as the need to live and feel life, to perceive, enjoy, and understand the world. The aim is to live in the actualities of the present moment, not in the imagined future that will only lead to fixations and obsessions…The final, and perhaps most important, symbol in “Ithaca” is Ithaca itself. Ithaca, Homeric Odysseus’ island kingdom, represents both the starting and ending place. Everyone comes from somewhere. There was a time and place that shaped them and made them what they are. As they reached adulthood they left home. Some went far indeed, even as this poem recommends. Ironically, the farther people get from home or focus (physically, temporally, and ideologically) the more they want to return. The great risk, however, is of idealizing your own personal Ithaca.
The point of life is the journey and the experiences along the way. If you go long enough you will eventually get back to where you began. Ithaca is the beginning and the end. Ithaca acts symbolically as a representation of the achievement of the goals people set in their lives. Consequently, the quest for reaching Ithaca stops being just a fantastic voyage... Instead, it can now be thought as everybody’s quest in their lives to make their dreams come true. Ithaca exists for each and every one of us, in personal and business life, although for each in different ways!
Remember, it is the path in between that makes life worth living! It is the path in between that makes a business venture a valuable experience and a remarkable story! It is the path in between that enriches our senses and intellect!

Read the full article at: "Ithaca" by C. P. Cavafis – An allegory about life (and business) ventures (August 2013)


Monday, April 8, 2013

Cyprus facts and European Union totalitarianism and horror...

Extracts from the article:

The European Union, the International Monetary Fund and the international media blame Cyprus’ banking practices as the main cause of the crisis… and made sure, that the economy of Cyprus was ruined in just a weekend!!! Manically, German and French mainly politicians, argued that Cyprus is harboring criminal money, that Cyprus is an offshore tax haven and a money laundering center! For the record, Cyprus is an EU low tax jurisdiction not an offshore financial center...
 
And it makes one wonder... Have all the so far EU, IMF and OECD reports and assessments on Cyprus been false?
 
Why is then Cyprus on the OECD’s white list of jurisdictions – complying with the global standard for tax co-operation and exchange of information? How come the OECD financial task force in its last report (and in others before it) stated that Cyprus complied with all forty-nine of its recommendations to combat money laundering (interestingly Germany failed to comply with five of them)? How come the Council of Europe awarded Cyprus with high marks on its last MONEYVAL September 2011 money laundering report? And, how come the IMF has been forecasting in its infamous last IMF staff report that Cyprus will have a balanced budget by 2014?
 
Yes, it is a fact, that the Cypriot economy became overly reliant on the banking sector, and Cypriot bank portfolios were not sufficiently diverse. That the resolution of Laiki Bank (country’s second largest bank) should have been taken up long ago and that the Bank of Cyprus (Cyprus largest bank) made disastrous bets on buying Greek debt at a discount and lost $2 billion as a result...
 
Yes, the public pension system should have undergone restructuring, i.e. revise contribution rate and retirement age, base benefits on career average not on final salary, index pensions to the CPI, etc.
 
Yes, automatic salary increment should have stopped a long time ago, public sector wages should have been contained and the size of public employment should have been reduced – public sector employees in Cyprus receive an estimated 30% higher salaries than those in the private sector!
 
Yes, C.O.L.A. should have been abolished... It causes large increases in real wages and deteriorates the competitiveness of domestic companies… it undermines flexibility and competitiveness as it impedes relative wage adjustments across companies and sectors in line with productivity differentials... it imparts inertia to the public sector wage bill… makes it more difficult to reverse the excessive growth of public sector wages and salaries…
 
Yes, governmental and semi-governmental sectors should have enforced a more efficient salary system based on merit and performance – employees there should not have gotten jobs for life despite performance – and trade unions (that remain extremely influential and had been pampered by each and every government in power because of political cost and own benefits) should not have been influencing management decisions to the extent that they did.
 
And yes, the Cypriot government, leadership and politicians should have put their personal and political party interests aside, and should have reacted to market signals a lot earlier than they did.
 
But did Cyprus do such terrible things that made it deserve this horrific fate? Is it only Cyprus’ fault? Is Cyprus the real problem? Is the Euro the real problem? What about the EU policymakers? Is their incompetence part of the problem at all? Are we witnessing an EU policy game changer? What is to be expected next from the EU think tanks and policymakers? Could anyone guess? As the Euro crisis worsens going into its fifth year, would the EU cathartic and fragmented policy move from one country bailout to the next? Is the Euro, a grand, political project with no practical foundation – hence crisis after crisis, with the dominoes stretching far into the distance?
 
The big question seems to be focusing on systemic risk: To what extent does the collapse of an institution imperil the financial system of a country as a whole? Is there really sufficient systemic risk to warrant a rescue of a “country giant”, in the case of Cyprus the Bank of Cyprus? And if there is, why there was not sufficient systemic risk seen in rescuing Laiki Bank?
 
Could the inability of policymakers, to enforce current regulations by imposing stricter more complex ones, create a more chaotic, slow-reacting, bureaucratic, multilevel regulation system which will be at the expense of movement of capital and everything positive that comes out from it?
 
Note that now we have capital controls and withdrawal restrictions and de facto wealth taxes inside the Eurozone... where depositors were threatened and directly hit... is the concept of the Euro to exist in the same format? Are we going to observe the start of multiple versions of the Euro in the near future? The restricted one now observed in Cyprus and the so far unrestricted one for the rest of the Eurozone?
 
Do the problems really lie in entities that tried to take advantage of whatever conditions they operate under? Or does the real problem lie in the framework created by politicians and bureaucrats, preventing free markets to deal with excesses in the way the laissez-faire economic philosophy always does? Do we want the free market economic system to survive?
 
Is this version of democracy (where only majority rule is required, but where there is no longer a respect for personal negative rights) the right one for the EU to keep on following? What about human dignity? Shouldn’t all members of the EU be functioning under the same law? Why was Cyprus treated differently than any other ailing EU member state?
 
As the bloated welfare states begin to collapse under politicians’ inefficiencies, bigotries, populism-like behavior and irresponsible promises, crumbling value systems and unsustainable demographics… wouldn’t it be easy to convince more than 50% of voters that confiscating and stealing other people's money is OK for the greater good?
 
Is it not what happened in Cyprus a clear step towards totalitarianism and suppression of individual liberty? Is this form of “EU democracy” a mean to the conquest of EU member states? Is this a new form of tyranny? EU tyranny? Is this what the European Union stands for? Is this the legacy as citizens of the world and Europe that we really want to leave behind? And if solid fundamentals are widened wouldn’t that lead to polarization in Europe?
 
The fate of Cyprus was basically sealed when the Troika revealed its first version of the bailout package!
 
Eurogroup President Jeroem Dijsselboem spread terror to Cyprus and the markets worldwide when he stated that the Cyprus “deal” is the new template... Mr. Dijsselboem said in essence that the EU will save the Cypriot financial system by destroying it... along with the rest of the economy of Cyprus... in essence he meant, if this experiment is successful then it will be used in the future, if it doesn’t, then who gives a damn about Cyprus...
 
But did Mr. Dijsselbloem think for a moment about what impact his so-called template surprise would have on financial markets? Did he consider, for example, that small and/or fragile banks in Portugal, Spain and Italy would face increased stress due to an exodus of funds now searching for safer harbors? Or depositors all over the Euro area would now have a strong reason to get out of European banks and the Euro, causing damage to both?
 
A bit later after criticism from EU partners and the ECB, Mr. Dijsselboem corrected his comments... Other EU officials hurried also to explain that what happened in Cyprus was a one off thing, that Cyprus is a unique case while Mr. SchaĆ«ble, the German Finance Minister, attempted to defend Mr. Dijsselboem’s comments... But then again ECB policymakers rushed to announce that Cyprus will be used as a model... Yet again, a bothered Mr. Juncker, the Prime Minister of Luxembourg, stated that Cyprus is not a blueprint, we cannot, he said give the impression that savings in Europe are not safe... So what is it? Are deposits in Europe safe or not? And if they are safe, why take such approach with Cyprus? Still remains to be understood, why Cyprus is such a unique case and what justified such approach?
 
In regard to the fate of Cyprus... with very little hope for any kind of immediate future it will more than likely fall into a depression... Hit by fiscal, financial, and wealth shocks... as the Troika demands further tax hikes and spending cuts in return for its €10 billion bailout loan... for another, its bail-in and capital controls will effectively kill off its financial sector and starve its people and businesses of credit... even worse, those people and businesses are going to need credit now more than ever after losing so much of their wealth in the bail-in...
 
In regard to the fate of Europe... well nobody knows... when it is obvious that the EU leaders do not know themselves...
 
 
Read more at www.pytheas.net 

Thursday, March 21, 2013

Cyprus – Is the European Union opening Pandora’s Box?

Are we witnessing the slow death of the European Union? Have the repeatedly failing EU policymakers finally opened Pandora’s Box with their recent proposal for Cyprus?

Why are some European member states taking actions that are catastrophic for the European sentiment?

Aren’t all citizens of the EU equal under the European law?

What a blunder! What a gaffe! Because it is a serious blunder and a gaffe when the EU is blackmailing the government of one of its member states, Cyprus – to confiscate the deposits that rightfully belong to EU ordinary citizens and others alike! Depositors that trusted the written and unwritten laws that the European Union inspired or used to inspire...

Could such action ever affect the European Financial Crisis positively?

Cyprus never had a problem with earlier “blunders” caused by EU policy... The Cyprus banking sector is indeed quite large but it was in solid state up until the one-sided decisions of some European governments caused many billions of losses to banks through the haircut imposed on Greek sovereign debt and elsewhere within the EU...

All EU member states must in concert find a solution for the EU as a whole instead of shifting the damage to one member state or another... The crisis of the Euro area is systemic! Decisions taken by the strongest countries in the EU have spread misery sequentially to citizens in Ireland, Greece, Portugal, Spain, Italy and now Cyprus. This is not going to end if they, the strongest countries, keep on handling the crisis in such manner. The EU has to enforce a decision making process where the European governments are asked to care for all their citizens. The inability of the EU to take care of its citizens wholly led to the failure of the EU... clearly seen these days by the way the EU has handled the Cyprus financial issue...

Is a Cyprus-like incursion on people’s savings unlikely to happen anywhere else in the EU?

This inconceivable way of blackmailing the government of Cyprus to confiscate the deposits is sending a clear message: Nobody with deposits in smaller countries, such is Luxembourg for instance, should feel safe with her or his deposits; nobody with deposits in a weaker financially country, such is Spain, should feel safe about her or his deposits either...

Whatever happens, the Cyprus story teaches important lessons for every European and not only economy: Austerity has failed!

A most valid question which if we answer yes to transforms into an oxymoron: Are the people that led Europe into this mess the right ones to lead Europe out of it?

Praying that there will be no bank runs across Europe...

It just does not make any sense...

You would expect that finance Ministers across Europe to have known better...

How could countries like, Cyprus, Greece, Portugal, Spain, Italy and Slovenia ever boost growth with no money? With lending rates continuously dropping how can any country even have growth?

One thing is for sure: Decisions like this one about Cyprus or about the haircut of the Greek debt benefit in essence some countries... it can be very easily observed from the markets that such decisions reduce the financing cost of the German government... the German government can now borrow at negative rates... while it inflicts pain and misery on other countries... not everyone is equal under the European law!

Moreover, Germany is quick to scold the citizens of other countries for the actions of its own government officials and bankers; actions which Germany tolerated and even encouraged for years... enjoying a large market for its manufacturing products, while exerting enormous financial leverage over other EU member states... its economic missteps have gone unnoticed and so has its profit-taking from its EU partners...

Only an ignorant should not worry that the total failure of the European Union is around the corner...

The European Central Bank has also been quite unclear on its position... and it was the vehicle to blackmailing the Cyprus government... thus contributing to say the least to the mess that the EU is now into...

In order for the EU to “work”, the EU needs to form a banking union (as per the European Council’s decision of June 2012) which primarily means that all member states should have a common credible deposit insurance guarantee; a guarantee that shall apply to everybody in the Euro Area! Now the EU or better the strongest states, members of the EU, made a mockery of it, sending clearly the message that that they do not want to be part of such a decision, a decision that they so much preached about and advocated for less than a year ago...

Those in the EU that use blackmail as a mean to their own benefit should think again... Is it the right way towards a better EU to demand confiscation of somebody’s deposits? It is not! And notions of recalibrating the amounts to be seized or better stolen from depositors are not a solution either! The EU as a whole should take responsibility! And remember this is more about Europe than about Cyprus!

Think!

Is it just about the Russian money deposited in Cyprus? Funny, the EU did not feel that way two decades ago, even a few years ago...

Is it just a Germany-led propaganda which argues that the Cyprus depositor is aimed at Russian oligarchs who evade taxes? But it targets ordinary Cypriots nearly as much as it targets high depositors and somehow it doesn’t matter if it’s the life savings of a middle-class family...

Is it just about the deposits of non-residents? Only very recently the IMF and the EU stated in their reports about Cyprus that supervision of international and local commercial banks in Cyprus are more than competent, progressed over the years to the highest of standards...

Is it just about the recently confirmed and scientifically estimated huge hydrocarbon reserves of Cyprus? A fact by the way that has so strangely been ignored or diminished by the EU and international media...

Could it be that the EU in its effort to save a mere €5.8 billion (the Cyprus “bail-out” money)... is upsetting European confidence and trust... facing possible bank runs... and in essence risking trillions?

Frightening! Scary!

One is for sure: Mattresses are looking a lot more attractive than European banks nowadays...
 
 
See more at www.pytheas.net

Tuesday, February 26, 2013

PYTHEAS has been designated to receive the prestigious International Arch of Europe for Quality and Technology Award by B.I.D.

PYTHEAS has been designated to receive the prestigious International Arch of Europe for Quality and Technology Award in the GOLD category by Business Initiative Directions (B.I.D.).

Presented for corporate achievement, excellence and innovation it is known to be the world’s most comprehensive business quality award based on a seven criteria that contribute to quality and success (Excellence, Innovation, Customer satisfaction, Technology, Leadership, Strategic planning, Business results).

BID's Selection Committee consists of a group of international experts in business communication formed by engineers, physicists, mathematicians, economists, psychologists, sociologists, journalists, designers and architects who research a maximum of public and private resources about the candidate companies. The process also includes the use of an official ballot and voting by the executives of Fortune 500 companies. Finally, a jury formed by the leaders of previously awarded companies and selected global business personalities further evaluate the candidate companies based on the following QC100 TQM principles:

  1. Customer satisfaction
  2. Respect for the environment
  3. Corporate social responsibility
  4. Benchmarking
  5. Information and data analysis
  6. Leadership
  7. Planning and decision -making
  8. Human resources
  9. Continuing education and training
  10. Processes and production
  11. Innovation and technology
  12. Communication strategies
  13. Business results
  14. ISO 9000
  15. TQM.

The presentation of the Award to PYTHEAS will take place during a special ceremony at the B.I.D. International Convention for Quality, Innovation and Excellence, in Frankfurt, Germany on April 27th and 28th, 2013.

Wednesday, January 16, 2013

Keele North Recycling Inc., a Pytheas Preferred Associate

PYTHEAS appoints Keele North Recycling Inc. (KNR) as a Preferred Associate in Waste Management for North America. Established in Toronto, Canada, KNR is an innovative waste management solution group of companies encompassing more than three decades of industry expertise.

As per Mr. Romeo DiBattista Jr., President & CEO of KNR, “We look forward to this novel and exciting relationship with Pytheas and SWLS to further enhance our products and services; and assist communities and municipalities in our immediate region and beyond to moving their integrated waste management systems to the next level”. Also as per Mr. DiBattista Jr., “Pytheas’ funding solution abilities and SWLS’s revolutionary but long tested approach of a-no-chimney-no-landfill solution, utilizing amongst other, effective waste material handling system, anaerobic digestion, and landfill reclamation technologies, can only contribute to further conserve resources, reduce environmental impacts and greenhouse gas emissions, produce green energy, eliminate dependence on landfills, create more jobs and improve social acceptability”.
 
Mr. Harris A. Samaras, Chairman & Group CEO of Pytheas, pointed out, “We find in KNR a trusted associate with long industry expertise and understanding of the North American market and its idiosyncrasies. We strongly believe...

See relevant Press Release

More at www.eco-knr.com and www.pytheas.net
 

Friday, September 14, 2012

A third gas corridor: Prospects for the East Med

Source: Pytheas Limited
Harris Samaras, Chairman & Group CEO of Pytheas, talks to Leigh Elston, Editor & Senior Reporter of Interfax, about the possibility, and importance, of the Eastern Mediterranean hydrocarbons to Europe and more (14 September 2012).

Extracts from the interview of Mr. Samaras with Interfax:

Dimitris Manolis, the Interconnector Turkey-Greece-Italy’s (ITGI’s) director of international activities, this week raised the possibility of bringing East Mediterranean gas to the European market via the ITGI pipeline as early as 2018. Harris Samaras, the chairman and group chief executive of Pytheas, an international investment banking organisation, spoke to Interfax about the benefits of, and technical and commercial challenges to, building ‘the East Med’ pipeline.

Interfax: Would a pipeline running from the East Mediterranean, as suggested by Dimitris Manolis, be feasible?

Harris Samaras: The construction of this ‘East Med Pipeline’, which would connect Israel, Cyprus and Greece to Italy and the rest of Europe, is feasible but it will be costly, and can only be justly assessed when further exploration is concluded and additional gas deposits are confirmed. If, however, the scientifically estimated deposits are proven to exist, it is undoubtedly the best long-term option and solution, not only for the countries involved, but for the EU as well. It is a solution which will liberate the EU from its energy dependence on volatile or [sometimes] ‘hostile’ countries – as both the source and the transportation means will be owned and controlled by EU-member countries alone. Needless to mention, it would strengthen Europe’s negotiating tools in the markets.

Interfax: What technical difficulties would the construction of the pipeline pose?

HS: The most challenging and costly part of such a project would be the construction of the pipeline between Cyprus and Crete (points B to C on the map, above), an approximate stretch of 675 km at depths of about 800-2,000 m. The 3,000 m depths could be avoided if the pipeline bypasses the Herodotus Abyssal Plain, which in certain places is about, or even exceeds, 3,000 m. The total distance, between A and G, and B and H, is about 1,880 km. Approximately 330 km of the pipeline lies within the exclusive economic zone of Cyprus, 1,250 km is within Greece’s (approximately 635 km of which is onshore), 80 km is within Italy’s and 220 km within Israel’s.

Interfax: How much is the project likely to cost?

HS: Roughly, the construction cost of a pair of 32 inch pipelines from Cyprus to Crete at depths of around 2,000 m is likely to be around $25 million per km and, to reach a 28 billion cubic metre per year capacity, the estimated capital cost for pipelines from Cyprus to Crete would be around $20 billion. This is a significant amount, but not prohibitive if the estimated deposits of more than 50 trillion cubic metres do exist.

Interfax: Is ITGI the best consortium to develop such a pipeline? Or should a new project consortium be put together to look into shipping East Med gas into Greece?

HS: It is highly unlikely that Cyprus will accept ITGI or any other consortium that includes Turkey when Turkey does not recognise Cyprus as a sovereign state.

Interfax: Is there enough gas to justify a pipeline to Europe, as well as an LNG export project, as favoured by the Leviathan consortium?

HS: A pipeline would be preferable to an LNG export plant; however, it is highly unlikely that further exploration, confirmation and exploitation procedures would be timely enough to meet the extremely ambitious 2018 or 2019 date. The challenges of engineering and construction, management and time related, economic, and geopolitical, are ample.

Right now there are not enough proven reserves to justify both projects or even to justify the construction of a pipeline.

The optimum scenario is that, until more hydrocarbons are confirmed in Cyprus and Greece, Cyprus will have to move swiftly with the construction and commissioning of the LNG onshore facilities, i.e., terminal, storage and liquefaction plant. Also, pipelines connecting the Aphrodite gas field and Israeli fields with the terminal have to be designed and laid.

Up until the liquefaction plant is constructed, the export of the Eastern Mediterranean gas surplus can by facilitated via CNG loading directly from the offshore field floating production systems to EU ports. Costs of shipping, including capital costs, would be roughtly $3 per million Btu (MMBtu) when average current market prices to European end users are $9/MMBtu.

In the short-to-medium, term and after the liquefaction plant is operational, gas can be transported to the EU via the more efficient LNG vessels (CNG’s volumetric energy density is estimated to be 42% of LNG’s).

In the long term, following further offshore discoveries in the region, the building of a pipeline system to transport gas from Israel and Cyprus to the island of Crete and then to mainland Greece and Italy into the European gas network makes absolute sense.

Although LNG may not be a perfect solution, it offers market flexibility and potential shipment to markets where prices are higher and it is considered a less risky method for monetising large amounts of gas. However, over and above the major upfront cost for the construction of a liquefaction plant, LNG costs significantly more than piped gas.

Furthermore, financiers of LNG investments may want to see a medium- to long-term commitment to buy if they are to break ground on a new project. And for any LNG plant to be truly profitable, it would need double the amount of gas known to exist in the Aphrodite gas field. Unless more gas is confirmed within the Cypriot EEZ or extra gas volumes from Israel are guaranteed, such a venture remains questionable.

Interfax: What role is East Mediterranean gas likely to play in Europe’s energy security?

HS: The significance of the southeastern Mediterranean hydrocarbons for the EU as a third corridor is beyond doubt. What is different about this particular corridor, over and above its estimated huge hydrocarbon deposits, is that Greece and Cyprus are EU member states and Israel an honest and trustworthy ally. For the first time ever in European energy history, the EU is guaranteed an uninterrupted supply of a traditional energy source of vast magnitude and potential.

Europe is confronted with a unique challenge and a remarkable opportunity and the need for EU action is stronger than ever.

Firstly, the EU should upgrade its role and involvement in the hydrocarbon efforts of Cyprus, Greece and Israel, to assist and ensure that an appropriate framework and solid plan are in place so that exploitation commences as quickly as possible.

Secondly, the EU should use its regional and global leverage to ensure that geopolitical challenges are resolved within international law and that the southeastern Mediterranean hydrocarbons become a tool for reconciliation and regional stability.

Finally, the southeastern Mediterranean corridor should be included in the EU’s energy policy and dealt with as such.

View the whole interview here and in .pdf here

Wednesday, September 12, 2012

East Mediterranean gas could be piped to Europe by 2018

Proposed East Mediterranean pipeline. (Pytheas Investor Service)
Proposed East Mediterranean Pipeline   (Source: Pytheas Limited)
Interfax (Natural Gas Daily) 12 September 2012 16:00 GMT
by Leigh Elston

The ITGI pipeline project, which in February was excluded from the bid to carry Azerbaijani gas into Europe, may instead tap into the East Mediterranean’s vast offshore gas reserves.

“By 2018-2019, gas from the East Mediterranean may find its way to Greece and through Greece to the rest of Europe, providing diversification and security of supply as well diversification of routes,” Dimitris Manolis, ITGI’s director of international activities, told Reuters on the sidelines of an energy conference in Vienna.

East Mediterranean gas explorers, led by Texas-based Noble Energy – the operator of the 480 billion cubic metre Leviathan gas field and 275 bcm Tamar gas field off the coast of Israel, as well as Block 12 offshore Cyprus – have so far favoured LNG export options over pipeline routes.
However, the huge gas potential of the Levant Basin – the US Geological Survey estimates 3.5 trillion cubic metres of recoverable gas lies off the coasts of Cyprus, Israel, Gaza, Lebanon and Syria – could support both an LNG export project and the ITGI pipeline link to Europe.

While a pipeline project is possible, it would be difficult to have a project operational within the next six years, according to Harris Samaras, chairman and chief executive of investment bank Pytheas. “It is highly unlikely that further exploration, confirmation and exploitation procedures would be timely enough to meet the extremely ambitious 2018 or 2019 date. The challenges are ample, engineering and construction related, management and time related, economic and geopolitical,” he told Interfax on Wednesday.

Alternative options

The ITGI project “remains open to export natural gas from Shah Deniz 2”, Manolis said, but only the Nabucco West pipeline and the Trans-Adriatic Pipeline made the shortlist drawn up in June (see Shah Deniz 2 decision looms for TAP and Nabucco West, 27 July 2012). Following this decision, “we are forced to consider, in parallel, alternative sources of gas”, Manolis said.

Italian utility Edison, one of the partners in the ITGI project, teamed up with Israel’s Delek Energy, Australia’s Woodside Petroleum and Italy’s Enel Trade to bid in Cyprus’ second offshore licensing round earlier in the year. Interfax reported in May that Delek’s decision to partner with Edison may signal intentions to use East Mediterranean gas as an alternative supply for ITGI (see Delek, Woodside and Edison team-up for Cypriot gas exploration, 14 May, 2012). Edison confirmed it was interested in gas exploration opportunities in Israel and Cyprus when contacted by Interfax on Wednesday, but declined to comment on potential infrastructure plans.

Commercially feasible?

Greece’s state-controlled DEPA, Noble Energy, Israel’s Delek Group and the Cypriot government are examining whether building a pipeline to bring Eastern Mediterranean gas to Europe is possible.
“At this point, it is premature to judge the feasibility and commerciality of a gas pipeline that would connect Israeli gas to Greece, via Cyprus. It’s long distance and over deep waters, and will be expensive to construct. It can only be justified if other factors fall into place – and one of the most important of those factors is finding other gas reserves,” Antony Livanios, chief executive of Energy Stream CMG, an international oil and gas advisory firm, told Interfax.

“Despite technical difficulties, the construction and operation of such a pipeline is doable,” Manolis told Reuters.
Yannis Maniatis, Greece’s former energy minister, is even more optimistic that the project will be commercial. “What is certain is that a pipeline from Cyprus or Israel is a bankable project, technically efficient and, of course, we in Greece fully support its construction and startup,” he told Interfax in May.

View the article at: http://interfaxenergy.com/natural-gas-news-analysis/middle-east/east-mediterranean-gas-could-be-piped-to-europe-by-2018/