Cyprus to become first EU country to import Israeli gas

Israeli energy company Energean announced on November 3 that it had signed an agreement to supply natural gas to the Greek Cypriot Administration of Southern Cyprus (GCASC).

With this agreement, the GCASC will become the first European Union country to import gas from Tel Aviv.

Energean, which operates Israel’s Karish, Tanin, and Katlan fields, has signed a memorandum of understanding with the Cyprus-based company Cyfield to supply gas to a power generation plant in the Mari region of Larnaca.

New pipeline proposal from Israel to Cyprus

As part of the agreement, Energean has also proposed the construction of a new pipeline to export natural gas from Israel to the GCASC.

According to the proposal submitted to the Israeli and GCASC governments, Energean will design, build, and operate the subsea pipeline that will directly connect the Karish field to the GCASC.

Eli Cohen, Israel’s Minister of Energy and Infrastructure, commented on the matter, stating, “The sale of gas to Cyprus will strengthen Israel’s diplomatic position in the region and in Europe, contribute to stability and prosperity, and generate billions of shekels in revenue for the state.”

Energean CEO Mathios Rigas stated that the proposal “will reduce Cyprus’s energy isolation with direct access to natural gas from a neighboring source, supporting regional cooperation and the transition to cleaner, sustainable energy.”

Cyfield CEO George Chrysocous also said the collaboration “has the potential to change the energy future of Cyprus.”

Agreement with Egypt awaits approval

In August, the Israeli company NewMed Energy signed a $35 billion deal with Egypt to supply 130 billion cubic meters of gas from the Leviathan field by 2040.

The Leviathan field in the Mediterranean Sea has reserves of approximately 600 billion cubic meters.

Following an initial agreement for 60 billion cubic meters in 2019, the field began production in 2020 and started supplying gas to Egypt.

However, Minister Cohen and Prime Minister Benjamin Netanyahu have not yet approved this $35 billion agreement, stating that they prefer the gas to be sold on the domestic market due to current prices.

US Assistant Secretary of Energy Chris Wright canceled his visit to Israel scheduled for next week after Cohen withheld his approval.

The White House and US-based Chevron, the operator of the Leviathan field, are pressuring Israel to approve the deal.

Israel’s domestic demand concerns

Egypt imports approximately 15% to 20% of its natural gas from Israel.

A portion of this gas is liquefied at facilities in Egypt and shipped to Europe via tankers.

However, a recent increase in Egypt’s domestic consumption has negatively affected exports, leading to a sharp decline in 2025.

Meanwhile, Israel is reluctant to increase exports to Egypt due to its own growing domestic demand.

Israel’s Ministry of Finance issued a warning at the beginning of the year, stating that the country could face a natural gas deficit risk over the next 25 years due to growing domestic energy needs, which could raise electricity prices for households.