Republic of Cyprus President Nicos Anastasiades this week sought a compromise with the Turkish Cypriots and Turkey in a bid to ease geopolitical concerns surrounding gas development offshore the island. It’s unlikely to be accepted, but could be a valuable starting point for negotiations.

Under the latest initiative, north Cyprus (solely recognised by Turkey) would receive 30% of any hydrocarbon-related revenues, a share roughly proportionate to the accepted population share of...