Larnaca municipality on Monday called on the transport minister to formally brief them about the status of the local marina and port development project – which hangs in the balance due to a dispute between the concession holder and the government.

In a statement, the municipality’s development committee said they want Transport Minister Alexis Vafeades to “clarify as soon as possible the situation under the current procedure with the existing or other [marina] investors”.

They also urged the minister to get back to them on what other alternatives are on the table should the project not proceed with the concession holder – the joint venture known as Kition Ocean Holdings.

Local leaders in Larnaca are on tenterhooks due to a seemingly intractable dispute between Kition and the government. The concession holder has refused to renew the validity of an Operation & Maintenance guarantee relating to the €1.2 billion marina and port project, leading the transport minister to seek legal advice from the attorney-general.

Elsewhere in the statement, the municipality complained about the conduct of Kition. It said the construction permit for the first phase of the project had been issued on April 26 of this year, and was ready to be picked up by Kition. The joint venture, however, never showed up to pick up the permit.

“The company Kition Ocean Holdings and its majority shareholder, Around Town, have not turned up to receive the permit,” the statement read. “Moreover, neither of the two have so far informed the municipality about their intentions.”

Earlier, the transport minister had told the Cyprus Mail that the government “may” take a decision on the matter in two weeks’ time. Terminating the contract with Kition is understood to be an option.

The issue is that since signing the contract in 2020, Kition has done virtually nothing at the marina and port apart from raising docking fees for boat owners and the businesses leasing boats. The project should have been completed by 2025. The joint venture had received several extensions because of the Covid situation.

The latest showdown came about over the O&M guarantee for the port which had expired and Kition was refusing to renew. It went to a meeting at the presidential palace to discuss it on April 15 and there it was apparently agreed that it would pay a guarantee for €4.2 million – significantly lower than the €10m it had been and the government was demanding.

April 23 came and went, and the guarantee was never renewed. The transport minister then turned to the attorney-general’s office for legal advice, to see how the government could proceed.