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The Republic of Cyprus is preparing to respond to the European Commission by the first week of September regarding a demand to return €101 million in funding that was allocated for the Vasilikos energy terminal, Energy, Trade, and Industry Minister George Papanastasiou said Thursday.
The European Commission is seeking the return of the funds, which were granted to Cyprus for the development of the terminal, citing concerns over the project's completion. Minister Papanastasiou clarified that the Energy Ministry, the recipient of the funds, has so far spent approximately €69 million on the project, with the remainder yet to be utilized.
"The Commission has given Cyprus the opportunity to explain certain aspects of the project. We will provide this explanation in early September," Papanastasiou stated. He emphasized that, at this stage, "nothing has been returned and nothing has been terminated," indicating that the government is working to avoid the withdrawal of the aid.
Regarding the next steps for the Vasilikos terminal, Papanastasiou mentioned that the Cyprus Natural Gas Infrastructure Company (ETYFA) is currently assessing the materials and equipment both on the ship and at the terminal site to determine their condition.
The minister also addressed the issue of the ship, owned by ETYFA, which remains in Shanghai. He noted that negotiations are ongoing between ETYFA and the Chinese consortium to take possession of the ship and arrange its transfer to Vasilikos. "We are aware of its location, what is on it, and how complete it is," Papanastasiou said. He reaffirmed the government's commitment to completing the project, despite acknowledging that the choice of contractor had been problematic.
On the subject of accountability, Papanastasiou stated that the Energy Ministry's primary focus has been on finishing the terminal. "If there are any responsibilities, the President of the Republic has made it clear that these will be addressed," he said, urging a forward-looking approach to ensure the swift availability of natural gas, which he described as crucial for reducing conventional power generation costs in Cyprus.
### Updates on Cyprus-Greece Electricity Interconnection
In addition to the Vasilikos terminal, Minister Papanastasiou provided updates on the Cyprus-Greece electricity interconnection project. He noted that two key decisions are pending: one from the Cyprus Energy Regulatory Authority (RAEK), expected by the end of August, and another from the Republic of Cyprus regarding its final participation in the project.
Papanastasiou explained that the RAEK decision will determine whether the project continues as initially planned, while the Republic of Cyprus will base its decision on a cost-benefit analysis conducted by specialized firms. This analysis and subsequent decision-making process are expected to take approximately three months.
The outcomes of these deliberations will significantly impact Cyprus’s energy strategy, as the country seeks to enhance its energy security and integration with the European grid.
