Greece Navigates its Energy Future Amid Turbulent Regional Waters
As East Mediterranean energy development projects advance, Greece navigates the geopolitical chessboard of energy and accelerates the roll-out of regional infrastructure.
Following the completion of the first phase of 3D seismic surveys in 2024 by PGS, the leading global seismic acquisition and processing company, petroleum geologists and energy economists estimate that a possible volume of 10-30 trillion cubic feet (tcf) of gas lies in the maritime areas southwest of the Greek island of Crete and in additional areas mostly located in deep and ultra-deep Greek sea waters.
The exploitation and monetization of the energy assets of Greece, with a focus on natural gas, could have transformational impacts on the Greek economy, enabling the drive to net zero carbon by 2050, while also fortifying the country’s role as a key driver of energy security at regional and European levels. It is in this context that Greece announced an international licensing round in early May 2025, after expression of interest by major American Chevron, for hydrocarbon exploration and exploitation in offshore areas south of the Peloponnese and Crete. Chevron communicated an interest in undertaking the operatorship of four concession areas, namely Block A2, South Peloponnese, South Crete I, and South Crete II, that cover a maritime space of approximately 47,000 square kilometers.
These areas are adjacent to concessions where ExxonMobil, an additional American energy major along with Hellenic Energy, holds licenses for the two offshore blocks west and southwest of Crete. The decision leading to exploratory drilling in the maritime area southwest of Crete that contains the Talos geological structure, which resembles the Egyptian Zohr field, depends on knowledge of the sea bottom currents, stability of the waterbed, presence of mud volcanoes and hydrates, structural discontinuities, and rock densities. In terms of timeframe, the first exploratory well is expected to be drilled in late 2026 and to this end, the Greek state must reconsider port facilities and residual environmental issues. The two concessions of ExxonMobil and Hellenic Energy cover a maritime area close to 40,000 square kilometers.
The Libyan Challenge and Contradiction
The international licensing process for the two blocks south of Crete triggered a reaction by Libya claiming that over 85 percent of the 23,300 square kilometer area covered by these blocks lies within Libya’s maritime jurisdiction. Libya challenged the median line set by Greece with a verbal note to the UN attaching maps that nullify the Greek Exclusive Economic Zone (EEZ) south of Crete and claim areas incorporated in the 2019 Turkey-Libya Memorandum of Understanding on Delimitation of the Maritime Jurisdiction Areas in the Mediterranean. The response by Greece has been legally solid in a verbal note to the UN citing that the two blocks south of Crete have been defined based on the equidistant line between Greece and Libya in compliance with the Greece-Egypt maritime delimitation agreement of 2020.
Libya’s purported “border line” has fully disregarded Greek islands and their entitlements to maritime zones in violation of the United Nations Convention on the Law of the Sea (UNCLOS). Specifically, Article 121 of the UNCLOS determines that islands have a right to territorial sea, contiguous zones, EEZ, and continental shelf in line with provisions applied in mainland areas. In addition, Libya’s purported “border line” has been measured from the straight baselines established by Libya in 2005, and from a closing line across the Gulf of Sirte, in an unlawful manner.
A contradiction between diplomatic theory and practice on behalf of Libya is more than evident and must be noted. The international licensing round that Libya holds, being the first in two decades, includes maritime blocks respecting the median line with Greece which, nonetheless, has been rejected in the Libyan verbal note to the UN. It is estimated that the motive behind Libya’s contradiction in its stance towards Greece is related to Turkey and Ankara’s profound effort to employ Libya as a trojan horse which advances the hegemonic conception of Turkey’s “near abroad” that centers on preventing neighboring countries from monetizing their own energy resources in its quest to control transit routes.
Exploration in Disputed Areas: The case of ExxonMobil
The profound question that emerges is to what extent can maritime delimitation differences prevent international energy majors from actively engaging in the energy exploration and development programs of East Mediterranean countries, including Greece. Reality and practice show that international majors explore energy resources in disputed territories when demand for energy is high, the potential profit is considerable, transparent regulatory frameworks enhance supply chain resilience, and technological advancements enable discovery of energy resources in deepwater basins.
The entry of American ExxonMobil in Guyana’s energy development program in the disputed oil-rich Essequibo region, serves as an example in this regard. ExxonMobil has explored hydrocarbons in Guyana’s offshore Stabroek, Canje and Kaieteur blocks that are claimed by Venezuela and has managed to turn itself into a leading oil producer that contributes to the development of the South American country’s energy industry and the economy. The employment of gunboat diplomacy by Venezuela has not prevented ExxonMobil from accelerating its drilling operations that led to 25 significant discoveries and with plans for additional drillings in two new wells off Guyana’s Atlantic coast.
With all the above in mind, the shift towards gas exploration in Greek maritime areas marks a new chapter with the involvement of American ExxonMobil and Chevron in deepwater exploration in south and southwest of Crete, and the southern Ionian Sea. If estimated energy resources turn into confirmed ones then, after a decade, a strong correction to Greece’s commercial balance, is expected to be achieved also giving space to gas exports.
Green Energy Corridors to Europe via Greece
The geographical position of Greece is a master advantage and must be preserved, not only as a north-south energy corridor but also as the western part of the Eastern Mediterranean and the eastern part of the Western Mediterranean. Electrical interconnections like GREGY and Great Sea, formerly known as the EuroAsia, that aim to connect the national electricity grids of regional countries with Europe highlight the geographical importance of Greece.
The GREGY Interconnector is an infrastructure project that aims to transport by a subsea cable renewable electricity that will be delivered from Egypt through Greece to Europe with bi-directional power transmission capacity. GREGY will transfer 3,000 megawatts of electricity, replacing 4,5 bcm of gas annually and reducing CO2 emissions by 10 million tons per year. For its part, the Great Sea Interconnector envisions to link the grids of Greece, Israel and Cyprus with the European power grid delivering up to 2,000 megawatts of energy, thus enhancing security of supply and incentivizing Israel, which is currently not interconnected to its neighboring states, to accelerate the participation of renewable energy resources in its energy mix.
The GREGY and the Great Sea Interconnectors are labeled as Projects of Common Interest by the EU and have attracted Europe’s top transmission system operators for their development, practically supporting Greek, Israeli, Cypriot and Egyptian common strategy to create a corridor for clean energy transportation that will enable them to become major energy hubs for Europe.
It must, however, be noted that the Great Sea Interconnector bears a prime challenge to the execution of the part that would connect Cyprus to Greece. That is, the geopolitical risk is evidenced in the continued disruptions to seabed surveys by Turkish naval vessels that practically delay the project’s progress. In fact, roughly 60 percent of the required seabed survey work is completed incommoding the interconnector’s next phase. The GREGY project also bears two difficulties. First, Egypt cannot provide electrons to Greece because the necessary renewables are not yet in place. Second, Egypt imports gas from Israel to either meet its domestic needs or export it by sea, and therefore, will not burn it for electricity to Europe, except if gas is in excess.
Despite challenges, Greece’s involvement in the two electricity interconnection projects solidifies its cooperation with Israel, Cyprus, and Egypt, aiming to become a transportation hub in the East Mediterranean, and share infrastructure for electricity.
Antonia Dimou is Head of the Middle East Unit at the Institute for Security and Defense Analyses, Greece; and, an Associate at the Center for Middle East Development, University of California, Los Angeles