Egypt Signs Milestone $1 BN Gas Line Agreement with Cyprus

Egyptian Oil Minister, Tarek El Molla, has signed an agreement with Cypriot Energy Minister, Yiorgos Lakkotrypis, that has been touted as a huge step in Egypt becoming the premier energy hub in the East Mediterranean.

According to a statement by the Oil Ministry, the deal will create an underwater pipeline that forms a direct connection between Cyprus' Aphrodite natural gas field to two liquefaction plants on Egypt's North Coast. Set to cost at least $1 bn to build, the pipeline also sets in place a framework for the exchange of natural gas between the two countries.

Though the priority is that the gas received satisfy local need, the deal could provide a huge boost for the economy. Egypt will also re-export some of the gas back to Europe, which could potentially open up a huge new market, as countries on mainland Europe look to find other sources away from their dependency on Russia.

Main image from Bloomberg