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12° Nicosia,
01 October, 2022
 
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Cyprus now an important player in LNG arena

An important factor is the support from the Commission which is expected to change the playing field in the supply of natural gas from the Eastern Mediterranean

Apostolis Tomaras

Apostolis Tomaras

What Commission President Ursula von der Leyen said at the World Economic Forum in Davos on EU energy planning will change the playing field in the supply of natural gas from the Eastern Mediterranean.

References to the ambitious EastMed project but also to LNG stations in three countries (Cyprus, Greece and Poland) for the transfer of Eastern Mediterranean natural gas stocks to European markets, changes the energy arena, putting the wider region in the focus of EU interest. Ursula von der Leyen's reports are of particular importance to Cyprus given that the country is at the core of the EU's plans to wean the region from Russian hydrocarbons.

But what caused a sensation was the point in the speech when the President of the Commission mentioned the plan for a network of LNG stations in Cyprus, Greece and Poland.  For Cyprus, this point was essentially "manna from heaven", as it puts in the forefront once again Nicosia's longstanding ambition to create land-based infrastructure for the liquefaction of natural gas in Vasilikos, which will then be channeled to other markets.

Vasilikos

The role that Cyprus can play in the EU energy supply, was presented to "K" by Energy Commissioner Kadri Simpson. In an interview with the print edition last Sunday, when asked how Cyprus would be included in the plans for the transportation and infrastructure of liquefied natural gas (LNG) in the EU, the European Commissioner stated that LNG can cover 1/3 of the VAT imports from Russia.

"We expect to replace about 50bcm from the 155bcm we import from Russia with LNG. It is a more flexible alternative to pipelines. Undoubtedly, we would not be able to respond to the Russian threat today without the investments made in LNG terminals by the EU in the last decade. Significant infrastructure has already been completed with EU support.

"This year alone, projects of common interest for gas will add a total of 20 bcm a year to our energy system." Ms. Simpson referred to the energy center of Vasilikos and the role it can play both for the needs of the EU and the internal market of Cyprus. "In Cyprus, the floating storage and regasification dock in Vasilikos will start operating next year. With a potential capacity of 2 bcm per year, it will contribute to the end of the energy isolation of Cyprus and will allow the country to move away from the use of oil pollutants".

The new east of the LNG

According to sources from Brussels, the report of the President of the Commission with regards to Cyprus LNG also concerns the prospect of creating land infrastructure in Vasilikos. A project that was spearheaded by the Republic of Cyprus through its energy policy since the discovery of the first deposits in block 12.

The land infrastructure on Cypriot soil in combination with the research that had begun within the Cypriot EEZ was one of the strong provisos of Cyprus in the formation of geopolitical alliances that followed in the eastern Mediterranean. Both the government of Dimitris Christofias and Nikos Anastasiadis, subsequently, considered that Cyprus could take a piece of the energy pie beyond its country of production.

The LNG in Vasilikos remained at the top of political discussions in Nicosia until 2016, after which it regressed without, however, being abandoned. Behind it all, it seems that there were geopolitical balances such as Israel and its strong support for the EastMed pipeline, however, there was also Egypt which sought to become the energy center of the eastern Mediterranean with its two liquefaction terminals.

New perspective

In terms of cooperation, Cyprus aligned itself with the other countries of the tripartite formations, but never abandoned the land infrastructure on Cypriot territory. Officially, Nicosia had always talked, in general, about energy corridors, even during the period when EastMed was presented as the emblematic energy project of Cyprus-Greece-Israel. In the background, any ambitions for LNG in Vasilikos were maintained by ExxonMobil, which left open the prospect of creating a PV liquefaction terminal in Cyprus, subject to investigations both within the Cypriot EEZ and in neighboring parts of Egypt.

[This article was translated from its Greek original]

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Cyprus  |  energy

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