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Power generated by natural gas expected in 2021

Photo: Christos Theodorides

Natural gas for power generation should be expected on the island late in 2021, the head of the natural gas public company (Defa) said on Tuesday.

Symeon Kassianides briefed President Nicos Anastasiades on Tuesday on the successful completion of the tender procedure for the construction of the infrastructure necessary to import gas for power generation.

A multinational consortium made up of China Petroleum Pipeline Engineering, Aktor and Metron S.A., with Hudong-Zhonghua Shipbuilding, and Wilhelmsen Ship Management has ranked first in the evaluation for the construction of the infrastructure.

Kassianides said the procedure was now in its final stage when other bidders can appeal the decision.

If it all goes well, the contract with the successful bidder could be signed by mid-October, starting the process of having natural gas for power generation by December 2021, Kassianides said.

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

The €300m project is co-funded by the European Commission to the tune of €101m. The electricity authority (EAC) will put up another €40m while Defa is seeking financing from the European Investment Bank, the European Bank for Reconstruction and Development, and local lenders for the rest.

Kassianides said the project is “considered of the highest strategic importance so its not an interim solution.”

Provisions have been made so that the infrastructure can be used in the future if Cyprus manages to have its own gas, he added.

Initially, the plan is to import gas for power generation, not only for the EAC, but for other licenced organisations. Later on, it could be used in industry and transport, as well as ship refuelling, the Defa chairman said.

Defa is already running a separate tender for the provision of the gas.

The company intends to procure its LNG requirements through a combination of medium and long-term supply via one or more LNG sales and purchase agreements and supplemental cargos via multiple master sales agreements and a bidding process.

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