Egypt has inked a cooperation agreement worth about EUR 2 bn with Cyprus-based EuroAfrica Interconnector to link the power grids of Egypt, Cyprus, and Greece through Crete, the latter’s largest island, aiming to transmit 2,000 megawatts of electricity in either direction in the near future, Invest-Gate reports.

Under the deal, the 310-kilometer cable will be laid under the Mediterranean Sea, bridging Africa to Europe. Annual transmission capacity will be 17.5 terawatt per hour, exceeding the annual production capacities of Aswan Dam power stations, according to a cabinet statement on May 22.

It is estimated the project will take 36 months tobe implemented from the start of construction, with the lowest point is 3,000 meters below sea-level. Phase I will see the interconnector carry a capacity of 1,000 megawatts, which is set to be upgraded to 2,000 megawatts at a later stage.

The deal was signed between Egyptian Electricity Transmission Company and Nasos Ktorides, representing EuroAfrica Interconnector, in the presence of Prime Minister Mostafa Madbouly, Minister of Electricity and Renewable Energy Mohamed Shaker, amongst other state officials.

According to the statement, EuroAfrica described the deal as “a landmark.” Ioannis Kasoulides, the company’s chairman, remarked, “The national electricity grid of Egypt will be linked to the European electricity system through Cyprus and will contribute to energy security.”

On May 21, Shaker announced that electricity tariffs will be raised by 14.9% in FY 2019/20, effective starting from July 1. This comes in line with the state’s plans to phase out electricity subsidies by 2022.