This commentary is part of a dossier on Turkish-Egyptian relations, published in December 2024 by ISPI and the Atlantic Council.
Egyptian President Abdel-Fattah el-Sisi’s official visit to Turkey on September 4 represented a significant milestone in the relationship between the two countries. The visit came less than seven months after Turkish President Recep Tayyip Erdoğan visited Cairo in February, signaling a desire to thaw relations after a decade of tensions.
Since 2013, Turkey’s support for the Muslim Brotherhood, followed by diverging stances in the Eastern Mediterranean and the Arab Gulf, in addition to conflicting interests in Libya, severely strained relations between Turkey and Egypt.
A decade later, a more pragmatic approach prevails, building on shared interests, common concerns, and a will to manage tensions where conflicting views persist.
While the political standoff had a limited impact on economic and trade relations, Cairo and Ankara aim to elevate their bilateral cooperation to a new level over the coming years. Both would like to see energy at the heart of this cooperation.
So, what developments can we anticipate in the energy sector, specifically regarding natural gas, after this reconciliation?
Opposing tracks
The dynamics spurred by a series of natural gas discoveries in the region ultimately exacerbated existing tensions between Egypt and Turkey (though it did not cause them).
Egypt and Turkey gradually found themselves on opposing tracks.
Over the past decade or so, an implicit competition has emerged between the two countries, which have the largest markets and most developed infrastructure in the Eastern Mediterranean, each vying to become the main destination and transit point for the region’s gas resources. Adding to this are their diverging views over how maritime borders should be defined: Turkey believes that islands’ capacity to generate maritime zones should be limited compared to states with longer coastal fronts, whereas Egypt signed agreements to delimit its maritime boundaries with Cyprus and Greece based on the median line, albeit adjusted where necessary. This brought Egypt closer to Cyprus and Greece. In parallel, the deterioration of Israeli-Turkish relations led to deeper engagement between Israel, Cyprus, and Greece.
What followed were years of diplomatic coordination among various countries in the region, each finding itself, from its own perspective, at the receiving end of a more assertive Turkish foreign policy. Numerous trilateral summits and ministerial meetings were held, which appeared to isolate Turkey in its own neighborhood.
The culmination of this trend was the launch of the East Mediterranean Gas Forum (EMGF) in 2019. The forum addressed the need for a regionally coordinated effort to unlock the full potential of Eastern Mediterranean offshore gas wealth while also carrying a geopolitical dimension fueled by strained relations between most of its founding members and Turkey.
Several years later, however, the tangible outcomes of this flurry of diplomatic activity and the establishment of the EMGF have fallen below expectations. A snapshot of the current situation in the region reveals that Egypt is facing a gas deficit, Cyprus is struggling to develop its reserves, and Israel is engaged in a multifront conflict that has increased risks for its energy sector.
For now, Turkey appears to have navigated this stormy period with assertiveness and determination. It confronted what it perceived as provocative exploration activities by putting pressure on companies, sometimes going as far as obstructing their work, and by conducting its own exploration, often in areas claimed by neighboring countries.
In parallel, Turkey invested massively in its natural gas infrastructure, particularly in regasification and storage facilities. Remarkably, its regasification capacity has grown fivefold since 2020. The ability to import more natural gas than the domestic market needs, coupled with its pipeline networks, allows Turkey to position itself as a gas supply hub, particularly for countries in Southeast Europe. Today, Turkey appears to be facing a notably different regional landscape.
Potential areas of discussions
Reconciliation between Turkey and Egypt will inevitably bring up discussions on a range of questions that interest one or both sides and have varying degrees of actual implications for the Eastern Mediterranean energy landscape. Four issues are frequently raised:
– Egyptian LNG exports to Turkey
Boosting Egyptian liquefied natural gas (LNG) exports to Turkey appears to be an obvious area of cooperation. However, Egypt’s gas production is experiencing a steady decline, driven primarily by falling output from the Zohr gas field and a mixed exploration record in recent years, resulting in modest discoveries that are insufficient to offset declining output from legacy fields. Production fell to a seven-year low in July, while consumption remains robust, leaving Egypt with a widening gas deficit.
This decline directly affected Egypt’s LNG exports. After a remarkable 2022, which saw LNG exports rise to 7.14 million tons, exports fell by more than half to 3.32 million tons in 2023. This year, Egypt is back to importing LNG and has even made plans for wintertime deliveries, a period during which Cairo normally ramps up exports as domestic consumption slows down.
In the past few years, there has been an increase in Egyptian deliveries to Turkey. Since 2021, in particular, Turkey has been a primary market for Egyptian LNG, serving as its top destination in 2022 and 2023.
While Egypt does not exclude exporting a few cargoes this winter despite the domestic gas deficit, such exports would involve modest volumes. Egypt is unlikely to regain its status as a net exporter or to be a significant supplier to Turkey in the short to medium term.
Thus, while this is an area of cooperation that both Cairo and Ankara are keen to develop, Egypt’s ability to export substantial volumes of LNG will depend on the availability of feedstock gas, which in turn relies on two supply sources: (i) domestic production, with the hope of striking new discoveries, as output gains from existing fields will not suffice; and (ii) imported supplies from Israel and, potentially, Cyprus. Israeli deliveries are expected to increase over the next couple of years, while Cyprus may be able to supply Egypt with gas starting in 2028.
– Exploration
Another potential area of cooperation is hydrocarbon exploration. Egypt has been organizing bid rounds almost annually. The current tender, launched in August and expected to close in February 2025, may offer an opportunity for a Turkish company to enter the Egyptian market, building on the normalization of relations between the two countries.
Over the past decade, Turkey and its state-owned energy company, TPAO, have developed an impressive offshore exploration fleet comprising surveyors and drillships. Unlike in the Black Sea, Turkish exploration efforts in the Eastern Mediterranean have so far been unsuccessful. However, one could argue that the primary objective behind these efforts was to assert Turkish sovereign rights in areas Ankara perceives as within its waters or to support the rights of Turkish Cypriots. Striking a discovery would have been a bonus.
Going abroad is next on Turkey’s offshore exploration agenda. Turkish Petroleum Corporation (TPAO) recently obtained exploration and production licenses for three blocks offshore Somalia. However, when discussing Turkish interests in offshore exploration abroad, Turkish Energy Minister Alparslan Bayraktar limited Turkey’s interest in Egypt to that of an LNG supplier, without mentioning exploration plans, and instead focused on Somalia and Libya.
In 2019, Turkey and Libya signed a memorandum of understanding on the delimitation of their maritime border, which was denounced by neighboring countries, including Egypt, as “legally groundless.” The agreement was followed in 2022 by a preliminary agreement on energy cooperation between Ankara and Tripoli, which the same neighbors also denounced. Any potential Turkish exploratory activity in contested waters is likely to cause new tensions between Ankara and Cairo.
– Maritime borders
When it comes to maritime borders, no significant changes in stances are expected. Neither is Ankara expected to reconsider the founding principles of how it perceives maritime boundaries should be defined, nor will Cairo denounce its agreements with Cyprus and Greece. Yet, Egypt’s conduct over the past years shows it is treading carefully between the two sides.
Even when tensions between Cairo and Ankara were high, Egypt refrained from provoking Turkey and concluded only a partial delimitation agreement with Greece in 2020, which left out the eastern part of the potential boundary to avoid going into the effects of the Greek islands of Rhodes and Kastellorizo on the final line.
Nor does Cairo want to jeopardize its relations with Athens. Following the 2020 maritime boundary agreement, Egypt launched a bid round offering a block whose northern coordinates may imply Egyptian recognition of Turkey’s continental shelf limit. Following a Greek request, Egypt changed the outline of the block to avoid getting entangled in a Greek-Turkish dispute.
Signs of Egypt’s “balancing act” were also observed during el-Sisi’s visit to Turkey in September, when the Egyptian president highlighted the need for de-escalation as a step toward settling existing disputes—something he said would enable energy cooperation between the countries of the region. The next day, Egypt announced that preparations are underway for holding a trilateral Egypt-Greece-Cyprus summit “in the coming period.”
– Turkey’s relationship with the EMGF
On paper, Turkey’s position, gas market, and infrastructure could foster regional cooperation and contribute to facilitating the monetization of Eastern Mediterranean gas resources, thus complementing the efforts of the EMGF. However, Turkey is unlikely to join the forum as a full member at this stage, despite its reconciliation with Egypt and a willingness to manage tensions with Greece. Indeed, such a move would go against certain fundamentals of Turkish foreign policy, given what it would imply in terms of recognition of the Republic of Cyprus and respect for maritime boundaries it contests.
Prospects for cooperation
The reconciliation between Egypt and Turkey should be seen as a process that requires a continuous willingness from both sides to manage remaining tensions. A more pragmatic approach is currently prevailing, but it doesn’t hide the fact that the two countries remain rivals, particularly in terms of regional influence. Turkey’s soft and hard power, in particular, are making strides in Egypt’s close neighborhood, which no doubt causes unease in Cairo and leads it to remain on guard. While both countries seem intent on managing their differences, tensions may reemerge in the future due to competing interests.
Going forward, in terms of energy, the areas of cooperation that could be developed involve mutually beneficial, low-political-risk projects. This could include Egyptian LNG exports to Turkey; however, in the short to medium term, it would depend on Egypt’s ability to overcome its domestic gas deficit. Exploring hydrocarbon resources or developing renewable energy projects could constitute other potential areas of cooperation.
Highly politicized projects, such as Turkey’s accession to the EMGF as a full member or a reconsideration of maritime boundaries, concern other regional actors. It is too ambitious to expect progress on this front over the coming period.