Romania and Bulgaria in Black Sea territorial dispute

Amid a surge of interest in Black Sea oil and gas resources, Romania has highlighted a border dispute on its Black Sea boundary with Bulgaria.

Romania's Foreign Minister Cristian Diaconescu said on 21 Marchthat “a disputed territory exists between Bulgaria and Romania that is of seventeen kilometers in the Black sea waters”. The two neighbours have been seeking to delimit their maritime borders for two decades: Diaconescu said that the lack of a formal agreement has not prevented the development of friendly relations between them, so the disputed area should be settled as soon as possible to prevent it becoming a problem.

The dispute has resurfaced due to the recent discovery of significant gas resources by ExxonMobil and Petrom (in which OMV holds a 51% stake) off the Romanian coast. In February the two partners announced that an exploration well at the Neptun block had struck an extremely attractive prospect, which contains up to 100 billion cubic metres of natural gas, and which may be surrounded by other attractive areas.

Bucharest has sought to reassure its neighbour, as well as the EU and international companies, that the dispute is not a major issue and is not yet at the stage of arbitration. Diaconescu said that the two sides would hold high-level talks and try to settle the matter amicably, although reports have also said that Romania will consider taking the dispute to the International Court of Justice if necessary.

Romania is keen to settle the issue in order to remove any uncertainty over its ownership of the exploration block in question. Substantial gas supplies would be a major boost for its economy and its political position within the EU.

Sources: Oil and Gas Eurasia, BusinessWeek, Novinite

Turkey to begin drilling off northern Cyprus

Turkey's TPAO has said that it will begin drilling off the coast of Turkish Cyprus “within days”, raising the stakes in the eastern Mediterranean energy game.

The chairman and president of the Turkish state energy company Mehmet Uysaltold Reuters that TPAO had started moving equipment there and would start shortly. Echoing the Turkish government's line, he also said that he would “take all measures” to protect the drilling if it took place in an area disputed by the Republic of Cyprus.

The company has not formally announced the location of its first drilling operations. The areas under contract between TPAO and the Turkish Cypriots cover a major area around the island, including areas to the south of the island which are within commonly accepted Greek Cypriot borders. For its first round of exploratory work, TPAO is unlikely to deploy anywhere too risky or controversial, and is likely to work off the northern coast.

However the company is undoubtedly serious when it says that “all measures” will be taken to defend its operations. The Turkish government has repeatedly expressed its willingness to deploy naval assets in its dispute with the Republic of Cyprus. When seismic vessels began exploring the area last year, in response to Cyprus's decision to allow Noble Energy to prospect for gas and oil, Turkish warships were reportedly shadowing the research ships.

The tensions between Israel and Cyprus on the one hand and Turkish Cyprus and Turkey on the other, have increased lately. Recently it was announced that Israel may be planning a military base in Cyprus; a Turkish minister also provoked controversy by suggesting that Turkey should annex northern Cyprus.

If TPAO strikes it lucky off the Cypriot coast these tensions are likely to increase further. Although it is likely that the company will restrict its activities to waters off Cyprus's north coast, there is no guarantee that the situation will not change in future.

Sources: Rigzone, Reuters, TPAO

Bangladesh hoping to offer disputed offshore blocks

The government of Bangladesh is hoping to offer a number of gas and oil blocks in April after a UN tribunal rules on its maritime border dispute with Myanmar later this month.

The head of the national energy company Petrobangla's PSC department, Muhammah Imaduddin, said on 7 March that “We are planning to offer at least two to three deepwater gas blocks in the planned April bidding round if Bangladesh gets legitimate right over the deepwater blocks”.

The tribunal is set to issue its ruling on 14 March; the relevant lawsuit was filed by Dhaka in late 2010 after a naval flotilla from Myanmar entered Bangladesh's waters to explore for resources.

Under the UN Convention on the Law of the Sea, Bangladesh is claiming an area ranging from 390 to 460 nautical miles southward from its coastline. Dhaka remains in talks with India over a separate maritime boundary issue. The disputes with its neighbours have hindered exploration of oil and gas reserves, which are desperately needed to tackle the country's energy shortages. In 2009 Tullow halted work in its two offshore blocks due to the maritime border dispute.

The government has expressed its determination to defend itself. Foreign Minister Dipu Moni said that “we will not stop from taking the legal route to achieve legitimate demands from our neighbours”.

The deepwater offshore gas blocks, located in the Bay of Bengal, may be highly productive. Bangladesh is banking on the tribunal ruling in its favour, and so avoiding a further – and increasingly political – stand-off with Myanmar.

Sources: Platts, Financial Express Bangladesh

Sudan border tensions reach boiling point

The confrontation between Sudan and South Sudan along their disputed border seems to be reaching a boiling point, with dozens killed in fighting and accusations that Sudanese jets have bombed targets within South Sudanese territory.

Tension has risen steadily over the past month, as rebels with links to the South Sudanese government have attacked towns on the Sudanese side of the border and Khartoum has responded by launching raids along the disputed boundary region.

At the end of February Sudanese rebels claimed to have killed 150 government troops in a border battle, prompting the Sudanese government to threaten retaliation against Juba for its alleged involvement. Although South Sudan denies supporting the Sudan People's Liberation Movement North, it is widely seen as a convenient proxy for Juba.

On 2 March, the South Sudanese government accused its northern neighbour of massing troops along the border and also said that some Sudanese military units had penetrated as far as 10 miles into South Sudan's oil-producing Unity state. Airstrikes against oil facilities were also reported.

The rise in violence suggests that attempts to demarcate the border, which were agreed last month, will come to nothing. Even the proposed demarcation process would exclude five disputed areas, underlining the distance between the two sides on the issue.

Control of oil-producing areas is one of the most contentious issues – almost all production is located in what is now South Sudan, although the export infrastructure is located in the north. Disputes over revenue-sharing have led Juba to shut down production, crippling its own oil-dependent economy but also seriously damaging northern Sudan.

The recent rise in border tension suggests that Khartoum is testing to see whether it could seize oilfields by force without provoking an international crisis.

Sources: Sudan Tribune, AFP

China calls on Burma to ensure border security

The Chinese government, in a rare if subtle criticism of a regional ally, has called on the Burmese government to tighten controls at their joint border after a rise in the number of refugees fleeing into China.

A senior Foreign Ministry official, Jia Qinglin, told the visiting Speaker of Myanmar's lower house that Beijing “sincerely hopes Myanmar will find a peaceful way to appropriately resolve problems with ethnic reconciliation and will protect the long-term peace and stability of the China-Myanmar border region”.

The coded put-down is rare for China, which regularly insists on its policy of non-interference into the affairs of other states. It follows attacks on Chinese shipping along the upper Mekong near the Burmese border last December, as well as a sharp increase in the number of ethnic Kachin refugees fleeing Burma amid fighting between ethnic rebels and the army.

Up to 10,000 refugees, mostly Kachin, have flooded across the porous border in recent months, according to local aid groups. They are now encamped in makeshift tent cities on the Chinese side of the border. Beijing denies the existence of the refugees, who are seen as an embarrassing testimony to the inability of China's ally to pacify its border regions.

Fighting between the Kachin Independence Army and the Burmese military flared up last June after a 17-year ceasefire broke down. The poorly policed border regions are easy territory for the rebels, who are fighting for greater autonomy from the Burmese government.

China's criticism may herald greater collaboration between the two countries on border security, especially if Beijing continues to feel that Burma is unable to handle the situation itself.

Sources: Reuters, AFP

CGX resumes operations at disputed Guyana well

Toronto-based explorer CGX has restarted drilling at the Eagle 1 well off Guyana, after a seven-year delay caused by border disputes between Guyana and Suriname. The resumption comes as part of increased interest in the oil and gas prospects off the northern coast of South America.

CGX, which has a 100% stake in the Corentyne licence where the Eagle well is located, restarted operations on 9 February. CEO Steve Hermeston said in a statement that the resumption “marks a significant milestone in the history of CGX”.

Drilling was suspended in June 2000, when Surinamese naval forces ordered a CGX rig to leave the area, accusing it of drilling in Surinam's waters. The area in dispute, the Guyana-Suriname basin, is believed to hold major gas and oil deposits.

The two sides contest the exact territorial line through the basin and the Corentyne river which empties into I – both parties aimed to get the largest possible share of the basin. In 2004, smarting from the suspension of the CGX contract, took the case to a tribunal operating under the auspices of the UN Convention on the Law of the Sea.

The five-member tribunal issued a ruling in September 2007 which allowed both sides to have access to the basin and the river, but gave Guyana a larger share of the basin itself: 12,800m2 compared to Suriname's 6,900m2. Despite the disparity, both sides have welcomed the result, with Suriname's president saying he was “delighted” at the ruling.

The resumption of operations by CGX is a clear vote of confidence in the new situation and a sign that exploitation of the region's resources can proceed.

Sources: Upstream, BBC

Disputed waterway between Iran and Iraq reopens

Commercial traffic has resumed on the Shatt al-Arab waterway between Iraq and Iran for the first time in 30 years, reflecting decreased tensions over the disputed marine boundary between the countries.

The reopening of the waterway, which runs for 120 miles down from the Gulf, follows the opening of a new jetty by Shell designed to support operations at the Majnoon oilfield on the border with Iran. The new facility is situated about 50 miles up the Shatt al-Arab: ships travelling there must first pay customs duties at the port of Umm Qasr on the edge of the Gulf.

Although there are other small harbour facilities down the course of the Shatt al-Arab, the Shell facility is the first major facility to be established there since the Iran-Iraq war interrupted southern Iraq’s oil operations in 1980. The war began in part due to a dispute over the border line through the Shatt-al Arab, which provides vital access to the Gulf.

The opening of the port suggests that the boundary dispute over the waterway, although not settled, is not proving an impediment to commercial activity there. Most of the remaining sections of the border have been agreed, and in late 2010 the Iraqi government said that the demarcation of the Shatt al-Arab line would begin under the auspices of the UN.

It seems that the process of demarcation is still underway. Nonetheless it seems that Iran is willing to accept – at least for now – some common usage of the waterway. This illustrates the warming political ties between Baghdad and Tehran and their willingness to move onwards from the disputes of the past.

Sources: AFP, France 24