Egypt’s gas crunch threatens Kronos exports

Cyprus approved development of the Kronos offshore gas field on 19 May, ending a 15-year wait to turn its eastern Mediterranean discoveries into actual exports. The target is first sales to Europe by 2028, using Egyptian liquefaction plants. But the route has a weakness built into it: Egypt has shifted from gas exporter to record importer since 2024. Cypriot gas may reach European buyers only after it helps plug Egypt's own shortage.

The Deal and the Route

The Cypriot cabinet approved the development plan and the core terms of a Gas Sales Agreement for Kronos, in Block 6 of Cyprus's exclusive economic zone, meaning the offshore waters where a coastal state holds resource rights. Kronos sits in a group of discoveries, including Aphrodite, Zeus and Calypso, with combined estimated resources of around 10 trillion cubic feet marked for export (Politis). No separate reserve estimate for Kronos alone has been published.

The operating consortium, ENI and TotalEnergies, each holding 50%, plans to send the gas by pipeline to Egypt's Zohr offshore infrastructure, then liquefy it at Damietta for shipment to Europe. If the final agreement is closed in the coming weeks, first production could arrive by late 2027 or in the first half of 2028 (Cyprus Mail, Protothema).

Cyprus chose Egypt because it has no liquefaction plants of its own. The EastMed pipeline, the proposed 1,900-km subsea link to Italy through Greece, was effectively shelved after the US withdrew support in 2022. Egypt offered something more practical: infrastructure already in place and close enough to use. In February 2025, ENI and TotalEnergies signed a trilateral agreement with Egypt and Cyprus to formalise that export route.

Egypt Gets First Dibs

Egypt's gas production fell from 70.4 billion cubic metres (bcm) in 2021 to 49.4 bcm in 2024, a one-third fall in three years, partly because output from the giant Zohr field declined. The country went from exporting 7 million tonnes of LNG, liquefied natural gas cooled for tanker transport, in 2022 to importing a record 9.01 million tonnes in 2025.

That matters because Damietta is not an abstract export terminal. It restarted in January 2024, then shut again by May because Egypt needed the gas at home. The contract reflects the same pressure. According to Al Manassa, Egyptian domestic demand takes priority, with a quarterly review that can divert gas away from European exports. European buyers could therefore hold contracts for gas that keeps being postponed, quarter by quarter, if Egypt's deficit continues.

The Oxford Institute for Energy Studies titled its March 2025 analysis "Cyprus upstream to help stabilize Egypt gas balances", not "to supply Europe". The most authoritative energy research body looking at the deal is treating it first as a way to steady Egypt's gas balance, and only then as a European supply source.

What's Still Missing

The EU consumed roughly 332 bcm of gas in 2024. Kronos, at full capacity, could deliver an estimated 6-8 bcm a year, less than 2.5% of that total. In a market where Russia's pipeline share fell from roughly 40% in 2021 to about 6% in 2025, every new source has value at the margin. For countries like Malta, which experience energy security as a practical question of supply routes and prices rather than grand strategy, the distinction matters: this would help Europe, but it would not remake the market.

Other southeastern European gas projects are moving on similar timelines. Romania's Neptun Deep expects first gas by autumn 2027 with capacity of 8 bcm per year. Kronos is different because its export route passes through a country that may have a stronger immediate use for the gas itself.

The agreement is not complete either. ENI has not taken its final investment decision, the formal approval to commit the money. The subsea pipeline to Egypt still has to be built, and the commercial terms remain confidential. As Politis noted, a discovery is not a development plan, a plan is not an investment decision, and an investment decision is not extraction.

Aphrodite, discovered off Cyprus in 2011, is still not producing and may not do so until 2031. Kronos has moved faster on paper. Whether it moves faster in practice depends on the one variable Cyprus cannot control: Egypt's growing appetite for its own gas.