Israel nears pact with Cyprus on Aphrodite-Ishai gas reservoir

A delegation from the Ministry of Energy and Infrastructure is due in Nicosia this week for talks with its Cypriot counterparts on the Aphrodite-Ishai natural gas reservoir, in the hope that a draft agreement can be drawn up that will resolve the disputes that have continued since 2011.

Substantial progress on the question of the reservoir, 90% of which is in Cypriot economic waters, was made at the trilateral Israel-Cyprus-Greece conference that took place in Jerusalem last month. At the conference, Israel’s Minister of Energy and Infrastructure Eli Cohen agreed with his Cypriot opposite number Michael Damianos on expediting the talks, on the basis of an estimate of the required division of revenue.

“The idea is to put into practice the decision of the energy ministers and advance the process. The goal is to enable the ministers to sign an agreement as early as February,” a senior Cypriot official told “Globes”. The Cyprus News Agency reported last week that the agreement on the Aphrodite-Ishai reservoir “appears to be entering the final stages.”

The talks between the two countries will focus on the management of the small part of the reservoir that is in Israeli economic waters, to formulate a compensation mechanism. The aim, according to the Cypriots, is to reach a gas consolidation agreement: consolidation of the licenses that will facilitate joint development of the split gas field in order to maximize the rate of production and exploitation of the economic potential.

“We are very close,” the Cypriot official said. “We have reached a very advanced outline proposal, and there are no substantial issues on the horizon that might take us backwards or require a long time to resolve. We are working to tie up the loose ends in the next few months; even the signing stage presents certain logistical challenges.”

The Ministry of Energy and Infrastructure stated: “The delegation that will depart this week for discussions in Cyprus will work to progress to signature on the agreement. The proposed outline is a joint procedure for choosing an expert who will examine the geological data and the development plan and on the basis of these will determine Israel’s share in the reservoir and ensure appropriate recompense.”

The goal: Liquifying in Egypt, selling to the world

The Aphrodite reservoir, which has gas reserves estimated at 129 BCM, is mostly in Block 12, at the south-eastern end of Cyprus’s economic zone. About 10% of it is in Israeli economic waters

The partners on the Cypriot side are Chevron (35%), Shell (35%), and NewMed (30%). On the Israeli side, the rights are held by Israel Opportunity, Nammax Oil and Gas, Eden Energy, and PSH (Petroleum Services Holdings). Cyprus has not waited for resolution of the dispute with Israel before developing the reservoir; the government in Nicosia approved the revised plan for Aphrodite in February past year.

Leviathan partners to invest $2.36b to expand production

The plan calls for a floating production platform and export of the gas via an undersea pipeline to Egypt. Cyprus is a minor consumer of gas. The way for it to generate substantial revenue is through liquefaction at the Egyptian plants at Idku and Damietta, and exports from there as LNG all over the world.

Development of the Aphrodite-Ishai reservoir is liable to anger Turkey, which does not recognize Exclusive Economic Zone borders in the region, particularly in the case of Cyprus, which it invaded in 1974 and where it set up the Turkish Republic of Northern Cyprus nine years later. The fear is that Turkey will take advantage of its sponsorship of the regime of President Ahmed al-Sharaa in Syria to sign a maritime border agreement between the two countries that will challenge Cyprus’s control of its economic waters.

Published by Globes, Israel business news – en.globes.co.il – on January 19, 2026.

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