Egypt, Cyprus sign gas export deals, boosting Eastern Mediterranean energy cooperation
Egypt and Cyprus signed an agreement on Monday that allows the export of natural gas from Cyprus offshore fields to Egypt, for liquefaction, and then re-export into Europe. Both countries are seeking to strengthen the role of the Eastern Mediterranean as an energy hub.
The 2025 Egypt Energy Show deals formalise the long-anticipated plan of linking Cypriot reserves with Egypt's LNG facilities. This move leverages Egypt’s existing infrastructure for processing and shipping natural gas to European market.
The Monday agreements include gas extracted from a Cypriot site called Cronos Block 6, which is now licensed to a consortium consisting of Italy's Eni, France's Total and Egypt's Zohr. It will be processed in Egypt's Zohr facility before it's liquefied and exported to Europe.
The second memorandum outlines the framework for processing gas from Cyprus offshore Aphrodite, under license to a Chevron led consortium. This gas will be sent to Egypt to be processed.
In recent years, major gas discoveries have been made in the east Mediterranean. Meanwhile, a disruption of energy supplies by Russia following its invasion in Ukraine in 2022 has heightened Europe's focus on finding alternative sources.
The statement by the Cyprus Presidency stated that "the essence of these agreements does not limit themselves to the promotion of the exploitation deposits but also broadens prospects for energy co-operation with Egypt while contributing to regional stabilization and strengthening the geopolitical positions of our country in the Eastern Mediterranean."
Officials in Cyprus have said that they anticipate gas from Block 6 Cronos coming online as early as 2026 or 2027. Cronos gas is estimated to be more than 3 trillion cubic feet (tcf).
Aphrodite is estimated to hold 3.5 tcf gas. Israel's NewMed, a consortium member, said that it expects the gas to be available in 2031.
In a filing update on Monday, it stated that the 'nonbinding' MoU envisaged Egypt's national company for gas, EGAS, as the sole buyer of gas produced by Aphrodite. The partners would have the option to buy specific quantities of gas sold to EGAS in LNG form.
After months of disagreement, Cyprus and a consortium led by Chevron have recently reached an agreement on a development plan.
The agreement is a major boost for Egypt. It has been struggling with a declining gas production at home and returned last year to being a net gas importer.
Egypt signed LNG supply contracts worth $3 billion with Shell and TotalEnergies in order to meet domestic demand by 2025.
Mostafa Mdbouly, Egypt's Prime Minister, has stressed the need for Egypt to increase production at its Zohr field. Eni has restarted drilling there after output fell to 1.9 billion cubic foot per day early in 2024. (Reporting and additional reporting by Michele Kambas, Editing by Susan Fenton).
(source: Reuters)
