Cypriot Minister of Energy, Commerce and Industry George Papanastasiou vowed on Sunday that the construction works for the Liquified Natural Gas Terminal in Vasilicos will go ahead despite the withdrawal of the Chinese-led consortium CMC from the project.
Replying to questions on how the government will advance the project following the unilateral termination of the contract by CMC, Papanastasiou said the project will be completed with other ways and a proposal will be submitted to the President of the Republic soon providing for the completion of the project outside the contract.
Commenting the LNG terminal’s strategic importance, the Minister said the project is indispensable for the Republic of Cyprus, as it associated with the introduction of natural gas, which will enable the reduction of conventional electricity generation costs and consequently high electricity prices.
ETYFA, the Natural Gas Infrastructure Company, a subsidiary of state-owned Natural Gas Public Company (DEFA) has assumed the constru
ction site in Vasilicos, including the semi-completed jetty and the inland part of the terminal.
Replying to a question on the Floating Storage and Regasification Unit (FSRU), which is in China, Papanastasiou said he is certain that developments will emerge probably next week.
He also explained that following the contract’s termination there are clauses which survive the contract termination and show the way for the project’s completion.
Through these clauses, and in consultation with the Chinese consortium, there will be a conclusion which will lead to the completion of the terminal, which is very important for Cyprus, he went on to say.
Asked on the current electricity prices, Papanastasiou said currently there is a subsidy in place which could be considered low under the climate circumstances with extremely high temperatures, noting this subsidy is within the state’s fiscal capabilities.
The government, he added, is focusing on a more sustainable solution to lower electricity costs both for consumers
and businesses and the economy in general.
This would be attained through three pillars. The introduction of natural gas strengthening renewables and electricity storage and the electricity interconnection of Cyprus, Greece and Israel which currently under discussion.
These three pillars, he said, will yield a serious reduction in electricity prices.
Although these three will not coincide, with the introduction of natural gas and renewables in the free and competitive electricity market expected in July 2025 I believe we will see an serious reduction compared with today, he concluded.
Source: Cyprus News Agency