TotalEnergies & ENI Partner With Cyprus & Egypt for Block 6 Gas Export
In a landmark agreement witnessed by Egyptian President Abdel Fattah El-Sisi and Cypriot President Níkos Christodoulídis, TotalEnergies and ENI have formalized a crucial deal with the Arab Republic of Egypt and the Republic of Cyprus. This Host Government Agreement (HGA), signed at the Egypt Energy Show (EGYPES), solidifies the commitment of these nations and companies to the development and export of gas from Cyprus’s offshore Block 6.
TotalEnergies, holding a 50% stake, and ENI, the operator with the remaining 50%, have been working together to advance energy exploration in the Eastern Mediterranean. The Cronos gas field, a significant discovery made in 2022, was successfully appraised in February 2024, paving the way for further development and commercialization. This agreement marks a pivotal moment in the effort to harness Cyprus’s offshore energy resources for broader regional and global energy security.
The Strategic Importance of the Agreement
The Host Government Agreement provides a structured framework to facilitate the transportation and processing of natural gas from the Cronos field. Under this arrangement, gas extracted from Block 6 will be processed at Egypt’s Zohr offshore facilities before being sent to the Damietta liquefied natural gas (LNG) plant. From there, the gas will be liquefied and prepared for export, primarily targeting European markets. This strategic partnership strengthens regional cooperation and enhances energy connectivity between Cyprus and Egypt while simultaneously supporting Europe’s efforts to secure reliable LNG supplies.
Background of the Cronos Gas Field and Cyprus Block 6 Development
The Cronos gas field is located within Cyprus’s Exclusive Economic Zone (EEZ) and has been identified as a valuable asset in the country’s quest to become a key player in the Eastern Mediterranean energy landscape. Following the successful appraisal drilling in early 2024, TotalEnergies and ENI have worked closely with the Cypriot government to outline the next steps for field development and production.
The successful exploitation of Cronos aligns with Cyprus’s broader strategy to develop its offshore hydrocarbon reserves, thereby enhancing its economic standing and reinforcing its geopolitical position in the Mediterranean. Moreover, it offers an opportunity for Cyprus to establish itself as a reliable energy supplier, while also fostering closer ties with neighboring Egypt, a regional leader in LNG infrastructure.
Egypt’s Role as a Regional Energy Hub
Egypt has positioned itself as a vital hub for the processing and export of natural gas in the Eastern Mediterranean. The country’s well-established energy infrastructure, including the Zohr gas processing facilities and the Damietta LNG plant, provides a strategic advantage in managing and exporting gas from regional fields.
The Zohr field, one of the largest natural gas discoveries in the Mediterranean, has played a crucial role in transforming Egypt’s energy sector. By integrating Cyprus’s gas resources into its existing network, Egypt further strengthens its standing as a regional processing and export center, offering a viable route for monetizing newly discovered reserves. The agreement with TotalEnergies and ENI reinforces this strategy and ensures that Cyprus gas is efficiently processed and delivered to European markets.
European Energy Security and LNG Demand
One of the most significant aspects of this agreement is its contribution to European energy security. The continent has been actively seeking alternative sources of natural gas to reduce dependence on Russian supplies, particularly in the wake of geopolitical tensions and supply disruptions.
The export of Cypriot gas via Egypt’s LNG infrastructure provides an additional layer of diversification, ensuring that European countries have access to stable and reliable energy sources. LNG has become a crucial component of Europe’s energy mix, and agreements such as this one play an essential role in meeting demand while maintaining flexibility in energy procurement.
Economic and Geopolitical Implications
The collaboration between Cyprus, Egypt, TotalEnergies, and ENI holds significant economic and geopolitical implications. For Cyprus, the agreement represents an opportunity to capitalize on its offshore resources, attract further investment in the energy sector, and reinforce its position as a key player in regional energy markets.
For Egypt, this agreement strengthens its role as an energy processing hub, boosting revenues from gas processing and LNG exports. Additionally, deeper economic and energy ties between Cyprus and Egypt enhance diplomatic relations, fostering broader regional stability and cooperation in the Eastern Mediterranean.
For TotalEnergies and ENI, the agreement underscores their strategic commitment to expanding their presence in the region and maximizing the value of their offshore investments. The development of the Cronos gas field aligns with their broader goals of increasing LNG supply to global markets and ensuring long-term energy sustainability.
Next Steps: Cronos Development and Production Plan
With the HGA now in place, the Block 6 partners—TotalEnergies and ENI—will proceed with the next phase: the Cronos Development and Production Plan. This plan will involve close collaboration with the Cypriot authorities to outline the technical, operational, and commercial aspects of gas extraction and export.
Key milestones in this process will include:
- Finalizing the Engineering and Development Plan – Ensuring that all necessary infrastructure is in place to facilitate efficient gas extraction and transportation.
- Construction and Installation of Production Facilities – Establishing the necessary offshore and subsea infrastructure to support gas production.
- Integration with Egypt’s Processing and LNG Infrastructure – Coordinating with Egyptian authorities to ensure seamless transportation and processing of gas at Zohr and Damietta.
- Regulatory Approvals and Environmental Assessments – Addressing legal, environmental, and safety considerations to comply with international and national regulations.
- Commencement of Production and Export Operations – Initiating gas production and gradually ramping up exports to meet European demand.
Broader Implications for Cyprus’s Offshore Energy Sector
Beyond Block 6, TotalEnergies holds interests in several other offshore blocks within Cyprus’s EEZ, including:
- Block 11 (50%, operator)
- Block 7 (50%, operator)
- Block 8 (40%)
These holdings reflect TotalEnergies’ long-term commitment to developing Cyprus’s energy sector. Future discoveries and appraisals in these blocks could further expand Cyprus’s gas production capacity and strengthen its role as an emerging gas supplier in the region.
Industry Perspectives on the Agreement
Julien Pouget, Senior Vice President Middle East & North Africa, Exploration & Production at TotalEnergies, expressed enthusiasm about the agreement, emphasizing its role in enhancing European energy security. He highlighted how leveraging Egypt’s existing LNG infrastructure offers an efficient and commercially viable solution for exporting Cypriot gas.
“The signing of this Host Government Agreement is a major step forward in realizing the potential of Cyprus’s offshore gas resources. By utilizing Egypt’s LNG capacities, we are not only maximizing value for all stakeholders but also contributing to Europe’s energy security by delivering additional LNG volumes,” Pouget stated.
Similarly, ENI reaffirmed its commitment to the project, emphasizing its expertise in offshore gas development and its strong relationship with both Cyprus and Egypt. The company noted that this agreement aligns with its broader strategy of increasing LNG production and enhancing supply chain resilience.\
