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Cyprus

Talks over LNG spat have ‘gotten nowhere’

cyprus' minister of energy, commerce and industry george papanastasiou speaks during an interview with reuters at his office in the ministry in nicosia
Energy Minister George Papanastasiou has threatened walking out of the LNG terminal deal

Efforts are still ongoing to resolve the liquified natural gas (LNG) terminal dispute, Energy Minister George Papanastasiou said on Wednesday, stressing the government has not ruled out walking out of the deal with the consortium.

The beleaguered project escalated in the past two months, after the Chinese-led consortium halted construction work.

It also moved to claim €200 million from Cyprus in arbitration proceedings at a London court.

Speaking to reporters after a cabinet session, Papanastasiou said it was not a matter of reaching a settlement.

“The Vasiliko LNG terminal must finish.”

He underlined the reduced costs of conventional power generation go through the terminal because it is the first infrastructure project that will import natural gas into Cyprus.

Beyond the price of natural gas which is currently “quite low now”, there is also the issue of reducing pollutants. This comes with a cost attached and is eventually passed on to the consumer, Papanastasiou underlined.

“Therefore, efforts are being made in the direction of the consortium itself and there are also political efforts.”

The consortium is Chinese and the company managing this project is state-owned, he specified.

Though efforts continue, they have not ended up anywhere yet.

Papanastasiou stressed the government is ready for ‘Plan B’, where if the efforts do not satisfy the Natural Gas Infrastructure Company (ETYFA), Cyprus “will have to take some bold decisions.”

This does not exclude terminating the specific project with the consortium, he specified.

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