Energean plc has announced the signing of a Letter of Intent (LOI) with Cyfield, a leading Cypriot industrial and energy group, for the potential supply of natural gas to Cyfield's planned power generation facility in the Mari area of Larnaca. The project aims to strengthen Cyprus' energy security and promote regional energy cooperation through a new subsea pipeline connection.

Pipeline Project Details

Following the LOI signing, Energean has proposed to the Governments of Cyprus and Israel the export of natural gas from Israel to Cyprus via a new pipeline system. Under the proposal, Energean will design, construct, own, and operate a new subsea pipeline connecting the FPSO “Energean Power”, currently producing in Israeli waters, directly to Cyprus. The project is designed to benefit both markets, promote regional energy collaboration, and contribute to the development of a competitive and interconnected East Mediterranean gas market.

The agreement and project are subject to the approval of the Governments of Cyprus and Israel.

Strategic Benefits and Impact

The interconnection between Israel and Cyprus is expected to deliver multiple benefits across both countries. The project will diversify Cyprus's gas supply sources, enhance energy security, and promote cleaner power generation by replacing oil-based fuels with natural gas. Additional benefits include supporting economic growth by stabilizing energy costs and improving efficiency, reinforcing regional cooperation, and contributing to the development of an East Mediterranean energy corridor. The project will also bring environmental and strategic benefits to Cyprus, including reduced CO2 emissions and closer alignment with EU decarbonization objectives.

Government and Industry Leadership Support

Israeli Minister of Energy and Infrastructure Eli Cohen expressed strong support for the initiative, stating that Israeli natural gas represents “a tremendous strategic asset for the State of Israel.” Cohen emphasized that the sale of gas to Cyprus will strengthen Israel's political standing in the region and among European countries, help enhance stability and prosperity in the area, and generate billions of shekels in revenue for the state.

He indicated his intention to continue promoting the expansion of Israel's gas export destinations. Mathios Rigas, CEO of Energean PLC, highlighted the company's commitment to operating a free market with fair competition, security of supply, and delivering natural gas to Cyprus for the benefit of the economy and consumers. Rigas described the proposal as offering “a practical and cost-efficient solution to Cyprus's energy isolation by providing direct access to natural gas from a neighboring source, strengthening regional energy cooperation and supporting the transition to cleaner, more sustainable energy.”

Cyfield's Role and Future Outlook

George Chrysochos, CEO of Cyfield, characterized the collaboration with Energean as having “the potential to transform Cyprus's energy future.” Chrysochos noted that access to natural gas will enable cleaner, more efficient power generation, reduce consumer costs, and help achieve national climate targets. The Cyfield CEO expressed the company's commitment to working closely with the Cypriot and Israeli authorities to bring the initiative to fruition, emphasizing that implementation remains subject to all required approvals from both governments.

The project demonstrates the potential for constructive cross-border energy collaboration between Israel and Cyprus, marking what could be a significant step forward for regional energy integration and supply security, should all necessary governmental approvals be obtained.

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