A new link-up between natural gas fields in Cyprus and processing facilities in Egypt was greenlit last week, with European energy giants TotalEnergies and Eni taking their final investment decision to fund the project.

The deal will allow for natural gas produced in Cyprus to be liquefied and exported from Egypt’s Mediterranean coast by 2028, a step that TotalEnergies CEO Patrick Pouyanné said would bolster “Europe’s energy security.” The bloc’s main natural gas suppliers have been hit in recent months by the disruption that the United States’ war on Iran has wrought on regional energy markets, as well as by ongoing tensions over the four-year war in Ukraine.

More importantly for Egypt, the long-awaited investment brings the country a step closer to fulfilling its ambition to become “a regional energy hub” — a policy target that successive governments have failed to hit since its adoption in 2018 .

Sources previously speaking to Mada Masr have described the Cyprus deal as a route to soothing Egypt’s energy deficit and, consequently, its dependence on Israeli gas imports, which have proved a source of diplomatic tensions in recent years adding to existing friction over Israel’s wars in the region.

The link-up also holds major potential to bolster Egypt’s foreign currency inflows from its Mediterranean coast, adding to existing revenue from Red Sea shipping, former Suez Canal Authority board member and maritime transit specialist Wael Kaddour told Mada Masr.

But the long-term prospects of this and similar deals were immediately stress-tested on Wednesday, when a drone strike hit energy vessels related to Egypt’s gas imports at its Damietta Port, just a handful of km away from the gas facilities at the heart of the new investment deal.

Eni and TotalEnergies’ new investment is already in the pipeline and unlikely to be derailed by a single drone strike, said Kate Dourian, a non-resident fellow at the Washington-based Arab Gulf States Institute and a fellow at the United Kingdom’s Energy Institute.

But from Egypt’s perspective, said Kaddour, the incident underlines the importance of global cooperation to ensure the security of key transit and logistical routes.

Italy’s Eni and France’s TotalEnergies announced Tuesday the adoption of their new investment plan for the development of Cyprus’s offshore Cronos gas field. The decision represents a breakthrough after years of technical and economic feasibility studies and talks with the Cypriot government since the field was discovered in 2022 .

Once production begins — which is not expected before 2028 — Cronos is to produce an output of around 500 million cubic feet of gas per day from four wells.

New infrastructure will then deliver the gas from Cronos to existing processing facilities at Egypt’s own Mediterranean field, Zohr, before it is piped onward to the Damietta liquefaction plant, where it can ultimately be stored in liquid form for export.

The Damietta plant is one of two liquefaction plants on Egypt’s Mediterranean coast, both built in the early 2000s. The gas from Cronos alone will utilize around 68 percent of the plant’s capacity.

The start of development at Cronos marks a major step to activating the plants as part of Egypt’s plans to become an export gateway for gas produced in countries across the southeastern Mediterranean.

Under the strategy conceived in 2018, Egypt was to combine its own energy surplus with natural gas piped in from neighboring countries to liquefy both at its northern coast plants for re-export to international markets.

Egypt had successfully played that role in the early 2000s using its own domestic surplus, but its success was short-lived.

Economic turmoil, declining domestic production and rising consumption since then have created instead a domestic energy deficit that has left Egypt a net energy importer, heavily dependent on gas imported via pipeline from Israel and on liquid cargo shipped mainly from the United States at present.

Reviving the plan rests on Egypt securing access to imports from gas fields in Cyprus, a step that has been in the pipeline for almost a decade but that has been repeatedly stalled as commercial and sovereign players in the region have vied to prioritize their own position in the southeast Mediterranean gas market.

The Cypriot government spent years negotiating with Chevron Corporation to settle on the “ optimal development plan ” in terms of returns for Cyprus before approving the …