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A hellicopter ferrying workers to Noble Energy Inc.'s offshore oil and gas rig takes off from Cyprus's Limassol port on Sept. 19.

Turkey has upped the ante in its dispute with Israel by sending an exploration team into disputed waters south of Cyprus in search of oil and gas. The move sharply escalates Ankara's conflict with its neighbours over energy rights in the eastern Mediterranean.

The last known position of the Koca Piri Reis, a Turkish research vessel, before its locating device mysteriously switched off on Monday was about 40 kilometres southwest of the Cypriot coastline, sailing briskly into territory reserved by the government in Nicosia for its own energy projects.

The Turkish government described the vessel's mission as a reply to Cypriot provocation last week, when Noble Energy Inc. of Houston, Texas, started the first exploratory drilling in the region. The company already has successful projects off Israel's coast, and a deal between Israel and Cyprus sets out the exclusive economic zone where Noble started working on Sept. 18.

Turkey disputes the deal, however, and threatened to back its own research vessel with warships and submarines. Prime Minister Recep Tayyip Erdogan has called the drilling "madness," saying that exploration should wait until after a political settlement on the island where United Nations peacekeepers have been deployed for more than four decades.

Greek Prime Minister George Papandreou spoke by telephone with Mr. Erdogan on Monday; a government spokesman said the Greeks called for "self-restraint and calm."

On the island itself, better known in recent years as a holiday destination than a conflict zone, residents said the rising tensions serve as an unpleasant reminder of the war that pitted the Turkish north against the Greek south in the 1970s.

"If it keeps going like this, there will be another clash," said Serdar Denktash, an opposition party leader and former foreign minister for the Turkish Republic of Northern Cyprus, the body that administers the northern half of the island.

"The armies on both sides, north and south, are now on alert," Mr. Denktash said. "We have not been on alert like this for a long time, maybe 10 or 15 years. It's disturbing, actually."

The dispute threatens to derail the latest round of north-south negotiations, ongoing since 2008. A meeting between the two sides and UN secretary-general Ban Ki-Moon is still scheduled to go ahead in October, but it's not clear whether the talks will be extended.

More significantly for the region, observers say, the dispute has raised the temperature on the already heated relationship between Turkey and Israel. Long steadfast allies, the two countries have seen a dramatic spiral downwards in recent months.

The Erdogan government served notice of its displeasure in the aftermath of the flotilla incident last year in which a Turkish vessel attempted to break Israel's maritime blockade of Gaza. In stopping the flotilla, Israeli commandos boarded the Turkish boat and nine Turkish citizens were killed.

Alon Liel, a specialist on Turkey and former director-general of the Israeli Ministry of Foreign Affairs, acknowledged the sore points that have come from Israel's co-operation with Cyprus.

He cited as examples the bilateral agreement to determine the maritime limits of the two countries without consulting Turkey (Turkey claims a special interest in safeguarding the Turkish Cypriots of northern Cyprus), and the co-operation in developing gas fields in each country's waters.

He also pointed to an apparent agreement to co-operate in exporting Israeli gas.

"Turkey is not happy about this," Mr. Liel said. "During the last two decades it worked hard to become the hub of gas and oil exports to Europe. They've invested heavily in pipelines across the country and in tankers and depots."

Israel's relationship with Turkey goes back more than 60 years. In 1949, Turkey was the first Muslim country to recognize the new Jewish state, something Israel has never forgotten. In the 1950s and 60s, links were mostly covert, involving military and intelligence-sharing, says Amikam Nachmani, a specialist on Turkey at Bar-Ilan University in Tel Aviv.

Since the early 1980s, Mr. Nachmani says, there was "an astounding expansion of connections – military, economic and civilian." These saw tens of thousands of Israelis vacation every year in Turkey and collaboration at the highest level in military training and supply.

For Turkey, it's been especially important that Israel joined it in condemning terrorism by Kurdish rebels, and in rejecting Armenian claims of genocide by Turkey in the First World War and after.

Some observers suggest that the best hope for detente might be a failure to discover significant energy reserves near Cyprus. There is no guarantee of recent claims that billions of dollars worth of natural gas lies hidden under that part of the Mediterranean, said Necdet Pamir, chairman of the energy policy committee at the Turkish Chamber of Petroleum Engineers. Both sides have promised a tit-for-tat campaign of exploratory drilling, but Mr. Pamir said that such a rivalry would come with a hefty price tag: perhaps $250-million to $300-million per drilling site.

"I hope that Noble will find nothing and leave on its own, for the sake of the people living in the area," Mr. Pamir said.

No Turkish military ships have been reported near Cyprus in recent days. The only naval craft visible in the area on Monday was a British warship, apparently headed towards the Suez Canal on an anti-piracy mission. Turkish military backup for its research mission could be scrambled into place quickly if needed, but may prove unnecessary because Cyprus does not have a meaningful navy, said Thanos Dokos, director-general of the Hellenic Foundation for European and Foreign Policy.

"Greece has no intention of sending warships, and Israel already has its hands full with other matters," Mr. Dokos said. "It's difficult to imagine any sort of 'hot' incident."

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