“National security agents first spotted the 12 terrorists in Sinai’s [northeastern] city of Al-Arish,” flagship state daily Al-Ahram reported.
“Security forces then engaged them in a firefight and killed them,” the newspaper added, citing a ministry statement.
The reports have yet to be independently verified.
The Sinai Peninsula has remained the epicenter of a militant insurgency since mid-2013 when Mohamed Morsi -- Egypt’s first freely-elected president -- was ousted in a bloody military coup.
Since February, Egyptian security forces have been waging extensive operations against what they describe as “terrorist groups” based in Sinai and Egypt’s Western Desert.