The government is in the process of returning €67 million in funding for the LNG terminal in Vasiliko to the European Commission, the energy minister said on Tuesday, also telling MPs he could give no timeline for the completion of the project.

Michalis Damianos said the €67 million that had been granted through Cinea – the European Commission’s Climate, Infrastructure and Environment Executive Agency – was being returned in two ways: by deducting from other EU funds allocated to Cyprus, and the rest in ‘cash’.

The amount represents part of the roughly €101 million grant approved for the LNG project in 2017 under the EU’s Connecting Europe Facility. Only €67 million was disbursed.

Brussels’ demand for repayment followed allegations of irregularities in the tender award process to a Chinese-led consortium and the mismanagement of the project.

The European Public Prosecutor’s Office is also investigating for potential corruption.

Damianos had appeared at the House energy committee three weeks ago to brief MPs on the trajectory of the troubled LNG project.

On Tuesday, he was asked directly for a timetable on the completion of the project.

He replied that at this time he was not in a position to give a timetable. Not even Technip – the government’s current consultants on the project – could do that.

“Once we are able to give a timeline, we will.”

The minister reiterated that the government’s priority is for the project to restart “from where it left off”.

They are seeking a new contractor via a tenders process.

Asked about potential offers from others, Damianos confirmed that talks are underway with a contractor from the United Arab Emirates.

Disy MP Kyriacos Hadjiyianni asked whether this would mean an interstate agreement between Cyprus and the UAE, circumventing the process advised by Technip.

“Discussions [with the UAE] are still at an early stage,” the minister replied.

Regarding the ‘gap analysis’ prepared by Technip, Damianos said it’s currently being assessed by Etyfa – the state-owned natural gas infrastructure company, the owners of the project.

The ‘gap analysis’ is a technical report describing the status of the LNG terminal.

Hadjiyianni asked the minister to share the report with parliament.

Damianos said he’d seek legal guidance on whether that’s feasible.

The Chinese-led consortium walked out in July 2024, leaving the LNG project in limbo.