vasiliko lng — The liquefied natural gas terminal at Vasiliko will be completed, Energy Minister George Papanastasiou promised on Tuesday during a session with the House energy committee.
- The liquefied natural gas terminal at Vasiliko will be completed, Energy Minister George Papanastasiou promised on Tuesday during a session with the House energy committee.
Papanastasiou made clear that the project “is feasible, should be completed, and will be completed.” However, he acknowledged concerns raised by Technip, the consulting firm hired by the public natural gas infrastructure company Etyfa. He quoted them as saying it is “impossible and operationally dangerous” to issue a call for tenders at this stage of the project.
Committee chairman and Disy MP Kyriakos Hadjiyiannis expressed frustration, suggesting that the government is employing delaying tactics to prevent the project’s completion. “A proposal should be on the table to break the deadlock,” he remarked, indicating that the current government strategy appears to be one of procrastination.
Papanastasiou explained that delays have occurred due to the incompletion of the project. He stressed, “We have a ship, which will probably be ready next month after passing the final checks. When that, the most important asset in this project, is ready, the rest of it will have to be completed in some way so that the ship can dock at the pier to begin gasification and the use of natural gas in conventional power generation.”
The ship in question is the floating storage and regasification unit (FSRU) Prometheas, which is currently undergoing certification in Malaysia. Earlier this year, it was anticipated that Prometheas would be certified by October.
Adding to the complexity, Papanastasiou mentioned that Technip has recommended a “gap study” to identify any deviations in the design or materials purchased. He expects this study to be completed within two months, which will inform the next steps for the project.
If significant issues are identified, a front-end engineering design will be necessary, essentially a mini redesign that will clarify the project’s course. Conversely, if no major problems arise, Etyfa could proceed with tendering for a new contractor to continue the work.
Concerns were also raised regarding the CPP-Metron Consortium (CMC), which terminated its contract last year. Papanastasiou stated he had not received any letters pertaining to an out-of-court settlement but confirmed that the legal service had been contacted and that discussions were ongoing to address this matter.
Some MPs voiced concerns over the financial implications of the delays, suggesting that citizens would ultimately bear the cost through increased electricity bills or taxes. Papanastasiou countered that such a position was “not documented.”
The session also touched on the European public prosecutor’s office investigation into potential procurement fraud and misappropriation of EU funds concerning the Vasiliko terminal. Papanastasiou confirmed that the matter is currently under investigation.
Just a month ago, he mentioned that the government was engaged in “damage limitation” following reports of serious safety issues regarding the terminal’s construction. A local television channel, Omega, reported significant technical issues that had halted work for months, with no clear timetable for resuming construction.
The LNG terminal project was initially contracted in December 2019, with an expected completion timeline of 22 months. However, complications arose when the CMC accused Etyfa of “bullying” and failing to make timely payments, leading to a breakdown in their working relationship.
In July of last year, another setback occurred when the European Commission ordered Cyprus to repay nearly €69 million in grants due to alleged irregularities during the tender evaluation period. With the situation continuing to evolve and various stakeholders involved, the future of the Vasiliko LNG terminal remains uncertain.
