12° Nicosia,
20 July, 2024

Cyprus faces crucial decision as LNG terminal contract nears end

Energy Minister George Papanastasiou provides updates on the Vasilikos LNG project in Parliament


Energy Minister George Papanastasiou announced on Tuesday that the contract between the Natural Gas Infrastructure Company (ETYFA) and the CPP-METRON Consortium Ltd (CMC Ltd) for the Vasilikos liquefied natural gas (LNG) terminal construction is approaching its conclusion.

Papanastasiou informed the Parliamentary Energy Committee that discussions were underway to terminate the contract and deliver the floating unit in its current state. He emphasized ongoing daily talks aimed at finalizing the agreement swiftly.

The Energy Minister detailed that the LNG carrier, configured for transport, awaits certification for gas regasification upon entry into an operational terminal like the one being developed at Vasilikos. He expressed ETYFA's intention to sail the ship soon and terminate the contract simultaneously while exploring alternative approaches to complete the terminal.

Addressing future plans, Papanastasiou clarified that the termination would trigger efforts to finish the terminal through surviving contract clauses. If insufficient, arrangements for a new contractor would be pursued to complete the remaining components of the project.

During negotiations with CPP, Papanastasiou described discussions as challenging, particularly concerning the departure of the floating unit and solutions for the terminal's other components.

The Vasilikos terminal encompasses three parts: the floating LNG unit, the jetty, and the onshore segment, with completion progress varying. Papanastasiou expressed confidence in completing the latter two parts with existing resources, despite ongoing challenges with the floating unit, which remains central to current negotiations.

Acknowledging delays and contractual extensions, Papanastasiou highlighted the terminal's incomplete status and discussed potential technical and financial issues on the consortium's side, emphasizing the need for resolution to ensure the terminal's operational readiness.

The Minister concluded that both sides are navigating towards a solution outside the existing contract framework, reflecting mutual recognition of challenges hindering terminal completion.

Cyprus  |  energy  |  Vasilikos  |  China

Business: Latest Articles