CMC contract for LNG Vasiliko likely to be terminated

The contract between Natural Gas Infrastructure Company (Etyfa) and CPP-Metron Consortium Ltd (CMC Ltd) for the construction of the natural gas liquification plant at Vasiliko is heading towards termination, Energy Minister George Papanastasiou said on Tuesday.

Papanastasiou made the announcement at the House energy committee, saying that Etyfa was now looking into other ways to complete the project.

Papanastasiou said the extensions given to the consortium indicated that there was no end date for completion.

The energy minister added that negotiations with the construction company to send the floating unit were at their final stage, with Etyfa aiming for the ship to sail out the soonest possible.

Deputy managing director of China Petroleum Pipeline Engineering Duan Bingquan had pledged his determination to bring natural gas to Cyprus at the end of June 2023.

Cyprus and a consortium led by China Petroleum Pipeline Engineering Co Ltd signed a contract for the construction of the nearly €300 million infrastructure for the import of liquefied natural gas (LNG) at Vassiliko for electricity generation, a project described as the biggest ever in the field of energy in Cyprus.

The LNG terminal was to include a floating storage and regasification unit (FSRU), a jetty for mooring the FSRU, a jetty-borne gas pipeline and related infrastructure.

The project with an estimated worth of €290 million secured a €101-million grant from the EU under the Connecting Europe Facility (CEF) financial instrument. The rest of the financing will come from Cyprus Electricity Authority`s participation in the share capital of the Natural Gas Infrastructure Company (Etyfa), with €43 million, and through financing by the European Investment Bank and the European Bank for Reconstruction and Development, with €150m and €80m respectively.