The government is contemplating its options for appeal following a directive from the European Commission to repay €67.2 million allocated for the liquefied natural gas (LNG) terminal at Vasiliko. Energy Minister George Papanastasiou confirmed this on Thursday, stating that the deadline for repayment is set for November 6.
Photo: cyprus-mail.com
- As the situation evolves, the Cypriot government grapples with the implications of the EU's demands while aiming to navigate the complexities surrounding the LNG terminal.
During a recent appearance on Alpha television, Papanastasiou faced numerous questions regarding the situation. He explained that since the project commenced in 2019, the commission had disbursed a total of €73 million in grants to the Cypriot government. However, the latest correspondence from the European climate, infrastructure, and environment executive agency (Cinea) demands the return of €67.2 million of those funds.
Papanastasiou clarified that the remaining €5.8 million had already been spent on project components completed prior to the grant allocation. He noted that this repayment demand is not the first; in July last year, the commission had initially requested a larger sum, but the current amount reflects a slight reduction following further discussions.
After receiving Cinea’s latest letter, the government engaged its legal service to assess the situation. Papanastasiou stated, “We are awaiting advice from the legal service,” indicating that various options are on the table, including a potential appeal to the European ombudsman or the Court of Justice of the European Union.
He emphasised that regardless of the ongoing legal processes, the government will need to deposit the €67.2 million by the stipulated deadline. If they succeed in their appeals, the funds could potentially be returned to Cyprus.
In the initial demand from the European Commission, several irregularities were cited concerning the evaluation criteria of the tender for the terminal project. The companies involved in the consortium responsible for the terminal’s construction had their contract terminated last July, further complicating matters.
Minister Papanastasiou reiterated the importance of the LNG terminal, stating that the project remains feasible and will ultimately be completed. He addressed concerns over delays, attributing them to the project’s current incompleteness. A floating storage and regasification unit (FSRU), named Prometheas, is expected to be ready soon, pending final certification.
Reports earlier this year had indicated significant safety concerns regarding the terminal’s construction, with claims of design and material issues leading to work stoppages. These allegations have raised questions about the project’s timeline and integrity, prompting the government to engage in damage limitation efforts.
As the situation evolves, the Cypriot government grapples with the implications of the EU’s demands while aiming to navigate the complexities surrounding the LNG terminal.
