The beginning of drilling several months ago predictably escalated tensions with Turkey, which still controls part of the island. Turkey has warned of naval intervention if Cyprus drills for the gas.
The Mediterranean is quickly becoming an offshore drilling hotspot. Noble Energy also is developing offshore gas fields near Israel, another project that Turkey is not pleased about. There is offshore drilling near Egypt and Libya as well. In November, Turkey itself announced intentions to work with Royal Dutch Shell to drill for natural gas in the area.
In April 2010, the U.S. Geological Survey released its first estimate of natural gas reserves in the eastern portion of the Mediterranean, known as the Levant Basin: they concluded that 122 tcf of technically recoverable gas is present. The entire United States produced 27 tcf of natural gas in 2010.
Natural gas in the U.S. has produced substantial political tensions, centered around development of the Marcellus Shale formation underlying Pennsylvania, New York, and other states. The Eastern Mediterranean, though, clearly has the potential for political grandstanding to devolve into outright conflict. The Cypriot gas field isn't going to be drilled on large scales for some time most likely, but the discovery of such large gas deposits has complicated implications for the area, both politically and environmentally.
(Image via USGS)