Row over LNG contract escalates

The contractor behind the Vasiliko liquified natural gas (LNG) terminal should be “counting the days” before it receives a notice of termination, Energy Minister George Papanastasiou said on Tuesday.

His comments come after contractor CPP-Metron Consortium Ltd (CMC) cut off the state-run natural gas infrastructure company which owns the project Etyfa access to all communication on Friday.

Already, Etyfa has been alarmed by the latest development, and has brought in legal experts from London in a snap meeting to weigh its options.

Papanastasiou described CMC’s latest actions as a “breach of contract” which comes after it completely halted construction works on January 25.

“What the contractor does not understand is that this is an act against the EU, not an act against Cyprus,” Papanastasiou said.

The project has been funded with €101 million by the European Commission and €240 million from EU banks, he stressed.

“This is a European project” and the contractor’s attitude is drowning any chance of success in the future, “if they keep behaving this way.”

The Cyprus Mail understands Etyfa is willing to terminate the deal with the contractor immediately however the energy minister wants to first “exhaust all options” before termination.

CMC argued it halted works because an invoice was not paid, however Papanastasiou said it has been settled.

“Now, if they do not go back to their work, it means they have other reasons to be doing this. If they want to exercise pressure on the Republic of Cyprus, they will count the days until they receive notice of termination.”

The minister described CMC’s attitude as “audacious” and stressed “our position is simple. They have to finish the project.”