Cyprus, Egypt to sign deal for offshore gas pipeline

Cyprus, Egypt to sign deal for offshore gas pipeline
Egypt's oil minister said the deal was a "win-win" for not only the two countries, but also for Europe's energy security.
2 min read
19 September, 2018
Cyprus' Energy Minister Georgios Lakkotrypis (R) with the Egyptian Oil Minister Tarek el-Molla (L) [AP]

Egypt is set to ink a deal with Cyprus to pipe offshore gas to plants in the north African country where it will be processed to export, Egypt's oil minister said on Tuesday. 

Tarek el-Molla said that under the terms of the agreement, gas off Cyprus could also be used for Egypt's domestic needs.

"So it is really a way to have ... good, win-win positions for not only Cyprus and Egypt, but also for Europe," El-Molla told reporters after talks with Cypriot President Nicos Anastasiades.

Egypt switched from being a net gas exporter in 2014 to an importer.

The country's gas rich Sinai region has been beset with security problems after an insurgency broke out following the 2013 military coup. Repeated attacks have been launched on gas pipelines to Jordan by militants 
cutting supplies.

Power outages and declining output have also pressured the Egyptian regime - headed by President Abdel Fatah el-Sisi - to use gas for the domestic market.

Cyprus' energy minister, Georgios Lakkotrypis, called the agreement - to be signed Wednesday - a first of its kind for the region that could bolster Europe's energy security.

Lakkotrypis said the agreement could act as an example for other neighbouring countries to offer oil and gas companies the kind of security on their investment so they can proceed with projects worth billions.

The Cypriot minister said the agreement concerns building a pipeline from the Aphrodite deposit - estimated to contain around 4.5 trillion cubic feet (130 billion cubic meters) of gas - to Egypt. But it can apply to other gas fields that may be discovered off the island in the future.

"This is a European pipeline because the natural gas that will be conveyed to Egypt from Aphrodite, after the commercial agreements are completed, will find its way to Europe in liquefied form," Lakkotrypis said.

Talks to hammer out a commercial deal for the pipeline will start soon, he said.