David Butter

Questions regarding the possible role of natural gas in the Syrian conflict have come up once more since direct Russian military intervention began at the end of September. It has been erroneously contended that Russia perceives a need to control Syria in order to protect its dominance of the European gas market, in particular from a proposed Qatari pipeline that would cross Syrian territory. Although the Russian state and its gas export monopoly, Gazprom, have a vital strategic interest in maintaining their 30 percent share of the European gas market and keeping an eye on potential competition, the actual or potential role of Syria in this is irrelevant to Russia’s involvement in the Syrian conflict.

The theory that Syria is significant to Russia’s gas exports rests on three possible scenarios: one would involve the construction of a pipeline from Qatar, through Saudi Arabia, Jordan and Syria, to Turkey, and onward to Europe; another entails a pipeline from Iran through Iraq to Syria and onward; and the third would arise from the discovery and development of offshore gas fields in Syrian waters of the Mediterranean.

The Qatari pipeline scenario has been given some credence in light of Qatari-Turkish discussions in 2009 and 2010, which floated the idea that the Gulf Arab state could contribute gas to the proposed Nabucco pipeline. However, grandiose pronouncements about pipeline deals are the common currency of high-level diplomacy, and it is rare for such projects to progress beyond the stage of the joint communiqué. Turkey may have had an interest in using the possibility of getting Qatari gas as a bargaining chip in its price negotiations with Gazprom, while Qatar at that time was grasping every opportunity it could get to advertise its global importance.

It has been claimed that the Qatar-Turkey pipeline plan failed because Syrian President Bashar Assad rejected it in order to protect the interests of his ally, Russia, in preserving its dominant position in Europe. There are more prosaic explanations for what took place. In 2005, Qatar had declared a moratorium on the development of new export-oriented gas projects, following a decade of rapid growth in output from the North Field, most of which was dedicated to sales of liquefied natural gas (LNG). Its only pipeline export deal was the Dolphin Gas Project to the United Arab Emirates and Oman. Qatar has refused to expand Dolphin until its neighbors agree to higher prices, and a proposal in 2005 to build another pipeline to Kuwait came to nothing as a result of Saudi objections.

Qatar already has a presence in the European gas market through sales of LNG. In 2014, almost one quarter of Qatar’s total LNG exports went to Europe. About half of this was accounted for by the United Kingdom, where Qatar holds a majority stake in the South Hook LNG import plant. Other European cargoes went to Italy, Spain and Belgium. Exporting LNG gives Qatar more flexibility of market access than a pipeline that would have to cross more than a dozen countries before it could reach the large northern European markets.

And the notion that Iran’s gas export ambitions are a factor in the Syrian crisis is, if anything, even more absurd. Iran is the largest gas producer in the Middle East, but it is also the largest gas consumer. It exports up to 10 billion cubic meters (353 billion cubic feet) of “dry” natural gas a year to Turkey, but it imports a similar amount from Turkmenistan. Plans to liquefy their gas and begin LNG exports have been on the drawing board for 20 years and are no nearer to coming to fruition, as is a plan to build a gas pipeline to Pakistan and India. Iran is now looking to entice international oil companies to invest in a major expansion of its oil and gas production capacity, but this will take time to achieve, particularly given the constraints on the companies’ capital spending budgets.

And even if Iran had enough surplus gas to export to Europe, the simplest options would be to boost the capacity of the existing line through Turkey or to build LNG plants. Sending gas through Iraq and Syria would make no sense, as it would either have to loop back into Turkey or be exported from an LNG plant on the Syrian coast, which would be an odd choice of location when Iran could build such plants in its own territory.

The third supposed threat to Russian gas interests are the possible natural gas reserves in Syria itself. Syria’s onshore gas reserves have been developed over the past 30 years, producing enough by 2010 to meet domestic electricity generation needs. Ultimately, Syria could benefit from building a domestic gas distribution system so households would become less reliant on mazout and butagaz (fuel oil and liquefied petroleum gas) for cooking and heating. Russian companies such as Stroytransgaz have built processing plants and pipelines for Syria’s gas sector, some of which have been financed by swaps included in Russia’s write-off of about $12 billion of Syrian debts in 2005.

In the middle of the first decade of the century, the Syrian government commissioned seismic surveys of its territorial waters to assess their oil and gas prospects. Interest in the potential of this zone grew following the major gas discoveries made in Israeli waters and off the coast of Cyprus. Syria offered four offshore blocks in two exploration bid rounds, but received only a limited response.

At the end of 2013, an agreement was reached with Russia’s Soyuzneftegaz to explore one of the blocks. In addition, the company held Syria’s onshore exploration concession (Block 12) and briefly had a 50 percent stake in Block 26, operated by Gulfsands Petroleum. On Sept. 29, 2015, one day before the start of Russian air strikes in Syria, the company announced that it was withdrawing from Syria for security reasons. It is possible that Syria’s maritime territory contains natural gas reserves, but as yet there is no proof. The process of turning such reserves into a profitable source of exports is complex and expensive, as can be gauged from the difficulty that the operators of the Leviathan field in Israel are facing in developing the 450 billion cubic meters (16 trillion cubic feet) of reserves that they have identified.

In light of this it is simply not credible to cite the potential of Syrian gas to infringe on Russia’s commanding position in the European gas market as a factor influencing Russia’s military intervention.

Furthermore, due to the expansion of production in the United States and elsewhere, there is currently a large surplus in the global gas market. Much of the growth in recent demand has come from China. However, the rate of increase in the consumption of Chinese gas has started to slow down as economic growth eases and services start to play a more prominent role in the economy.

In China, India, and Europe, the efforts to phase out coal for power generation have not led to a surge in natural gas use. That is because of the rapid growth and falling costs of renewable energy, in particular solar power. European gas consumption has fallen sharply in the past two years, and in 2014 was at about the same level as it was in 2002. There is huge over-capacity in the pipeline network connecting Europe to Russian gas supply, and Russia has recently signaled its determination to hold on to its share of the northern European gas market by launching the Nord Stream 2 pipeline project, which aims to carry 55 billion cubic meters (1.9 trillion cubic feet) per year across the Baltic to northern Germany. The fate of Russia’s planned Turk Stream pipeline across the Black Sea hangs in the balance, mainly because of the weak demand projections from southern Europe and Turkey’s wish for lower prices.

Identifying Russia’s major strategic interests in Syria can help to make sense of a conflict so brutal when explaining it in terms of naked power politics, state dysfunction, and warped ideology seem inadequate. However, the contention that Russia’s involvement in Syria is influenced by natural gas interests is far-fetched.