Cyprus LNG Terminal

From Global Energy Monitor
This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor.

Cyprus LNG Terminal, also called Vassiliko FSRU or the CyprusGas2EU project, is a proposed LNG import terminal in Cyprus. While the import terminal remains under construction, the export terminal appears to be cancelled with no development updates since 2015.


The map below shows the location of the project, near Vassiliko Port, in Larnaca District.

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Project details

Import Project

  • Owner: Natural Gas Infrastructure Company (ETYFA)[1]
  • Parent company: DEFA (70%), Electricity Authority of Cyprus (30%)[2]
  • Location: Vassiliko (Vasilikos) Port, Larnaca District, Cyprus
  • Coordinates: 34.720244, 33.32384 (exact)[3]
  • Capacity: 2 mtpa[4]
  • Status: Construction[5]
  • Type: Import
  • Cost: €542 million[6]
    • Formerly €337 million (US$358 million)[7]
  • Financing: European Investment Bank loan of €150 million, Connecting Europe Facility grant of €101 million, European Bank for Reconstruction and Development loan of €80 million, €43 million equity contribution from the Electricity Authority of Cyprus[8]
  • Start year: 2024[9]
    • Originally 2023[7]

Export Project

  • Owner: DEFA
  • Parent company: DEFA
  • Location: Vassiliko (Vasilikos) Port, Larnaca District, Cyprus
  • Coordinates: 34.72772, 33.30104 (exact)
  • Capacity: 5.0 mtpa, 0.72 bcfd
  • Status: Cancelled (potentially revived in 2022)
  • Type: Export
  • Cost: US$6 billion
  • Trains: 3 to 8
  • Start year:


Import proposal

In 2015, Forbes estimated the cost of the Cyprus LNG Terminal at US$6 billion.[10] It will include an LNG floating storage and regasification unit (FSRU), a jetty intended for the unit’s mooring, a jetty borne, a natural gas pipeline and an onshore gas pipeline, a shoreside block valve facility, an onshore natural gas buffer solution and a pressure reduction and metering station. The planned LNG facility will have an LNG storage capacity of 120,000-250,000 m3 and will aim to provide a send-out capacity of regasified LNG of up to 220T/hour (max yearly sendout of approx.2.44b cm /year and a max daily average of approx.76.17GWh /day) initially and be able to cover additional capacity requirement in the future. It is partially funded by the European Union (105,737,320 EUR/117,178,098 USD) and is listed as a Project of Common Interest (PCI). Commissioning was expected in 2022.[11]

Since at least 2009, the government of Cyprus has been promoting a proposal to build a liquefied natural gas (LNG) regasification facility near Vassiliko Port in Cyprus. The facility would import LNG for power generation at the 865 MW Vasilikos power station, as well as for industrial and residential purposes.[12] Specifically, the CyprusGas2EU Action project was created with the objective of introducing gas to Cyprus in order to "end the current energy isolation of the Member State" and use LNG in power generation.[13] It would be built by Natural Gas Public Company (DEFA), the Cypriot state-owned gas company.[14][15] In October 2016, DEFA initiated a study of the gas import proposal.[16]

In October 2018 the Cypriot government launched a tender for the import terminal at Vasiliko port, and in January 2019 extended the deadline for offers to March 2019.[17]

In August of 2019, the Natural Gas Public Company of Cyprus (DEFA) announced that a Chinese-led consortium has been chosen as the preferred bidder for the construction of the EUR 250 million LNG import terminal and related infrastructure. The consortium includes JV China Petroleum Pipeline Engineering Co Ltd, AKTOR S.A. and METRON S.A., with Hudong-Zhonghua Shipbuilding Co. Ltd and Wilhelmsen Ship Management Limited.[18]

The LNG import project is co-financed by a grant of 40%, or up to US$111 million from the European Union’s “Connecting Europe Facility”. The terminal was initially scheduled for completion in 2021. It will include a floating storage regasification unit (FSRU), a jetty for the mooring of the FSRU, jetty-borne and onshore pipelines, as well as additional facilities.[19]

The terminal is being built by a consortium of China Petroleum Pipeline Engineering, Metron, Hudong-Zhongua Shipbuilding and Wilhelmsen Ship Management.[20]

Construction of the FSRU-based import terminal at the Vasilikos port in Cyprus started in July 2020.[12] It was also reported that DEFA had opened a tender for the supply of LNG and had received expressions of interest from 25 international companies.[21]

In November 2021, the import project was included in the 5th PCI list published by the European Commission.[22] It was also reported that construction work at Cosco's shipyards in Shanghai had begun on the ship that will convert LNG at the import terminal in Vasilikos Port. The timetable for the start of operations was updated to "within the first half of 2023".[23]

As of February 2022, the Cyprus LNG import terminal was reportedly only 4% complete, and its projected start-up date had been pushed back to July 2023.[24] The timeline for completion of the terminal suffered another setback later the same month, when large quantities of illegally dumped chemicals were discovered at the construction site, raising the prospect of a time-consuming cleanup operation.[25]

In that same month, a Cyprus Mail article reported that major delays had been attributed to the construction of the jetty. According to the source, the building contract stated that the jetty had to be capable of both transporting regasified LNG from the floating unit to the shore while being capable of bunkering LNG to be used as a fuel.[24] This proposed dual import/export use of the jetty complicated construction and design, causing major delays.[24]

In January 2023, Cypriot media described the state of progress of the project as a "fiasco". The revised completion date for the project of mid-2023 was now thought to be impossible to meet, and even completing it some time in 2024 was said to be "under discussion". People familiar with the project were reported as saying that the project infrastructure – both on land and at sea – is basically "non-existent".[26][27]

According to the Cyprus Mail in January 2023, the construction of the LNG jetty was set to begin that month.[28]

In February 2023, the Cyprus Mail reported that construction on the project would be completed by October 2023, with an additional €25 million in project costs also announced following a new government agreement with the Chinese construction consortium. The government was reported to be claiming compensation from the contractor for the delays in completing the project.[7]

In March 2023, Cosco Shipping Heavy Industry in Shanghai announced that the Etyfa Prometheas, the FSRU that will serve the Vasilikos LNG import terminal, was almost ready for delivery.[29] The vessel, previously known as Galea, was built in 2002 and was originally designed to be an LNG carrier.[30][29] After completing the lifting of a regasification module and a compressor module and a new paint job, the newly named Etyfa Prometheas completed the last major segment of its conversion to an FSRU.[29] Although now able to function as an FSRU, the vessel will also retain its original functions as a merchant ship.[30] Cosco Shipping said it was ready to work on the delivery of the unit, but the company initially didn't state when the handover was to be completed.[29] Energy Minister George Papanastasiou said that the vessel would most likely be delivered by July 2023.[31]

In April 2023, the Cyprus Mail reported that the construction of the terminal's jetty was likely to be delayed again, according to Energy Minister George Papanastasiou.[31] Papanastasiou also said that although initial predictions put the percentage of completed works by October at 90%, the real figure was closer to 40%.[31] Hence, the Minister announced that the new completion date would most likely be pushed to the end of 2023 or the beginning of 2024.[31]

In August 2023, the timeline was pushed back 10 months, and the import terminal was not expected to become operational until July 2024.[9]

In January 2024, construction of the project was halted as "the China Petroleum Pipeline Engineering Co Ltd (CPP) has submitted a statement of claim before a London arbitration court seeking to claim increased costs from the Republic of Cyprus due to technical problems and delays surrounding the project."[32]

Export proposal

There was a proposal - separate from the import/regasification project — to build a 5-million-metric-ton-per-year (mtpa) LNG liquefaction facility at the same location, the Vassiliko Port.[33] The proposed export terminal would have had a minimum of three trains and a maximum of eight trains.[34]

In August 2014, the Cypriot government entered into negotiations with several firms over the LNG facility. In June 2015, several oil & gas companies declared Cyprus's Aphrodite gas field to be commercially viable.[35] According to one proposal, Israeli gas would also be exported from the Cyprus LNG facility.[36]

Forbes reported in November 2015 that if Egypt joins Cyrus and Israel in a venture to import gas to Egypt, the three countries have enough infrastructure to form a regional Eastern Mediterranean gas hub.[10]

There have been no development updates on the export terminal since 2015 and the project was presumed to be cancelled. However, in 2022, Energean proposed to export gas from its gas fields in Israel to Cyprus for "liquefaction using a floating liquefied natural gas vessel (FLNG) at Vasilikos and export to Europe." This proposal was reportedly in an effort to end dependency on Russian energy following the invasion of Ukraine.[37]


In June 2020, it was reported that the European Investment Bank (EIB) had agreed to provide the import project with a loan of €150 million euros, a decision which triggered the payment of a €101 million grant from the European Commission, which had already approved the project as part of the Connecting Europe Facility programme.[23] [38] The European Bank for Reconstruction and Development has also provided the project with an €80 million loan, and the Electricity Authority of Cyprus is providing a €43 million equity contribution.[8] In December 2020, the European Commission announced that it had approved, under EU State aid rules, Cyprus's intention to issue a state guarantee for securing the project loans.[39]

Question marks over contracting and high project costs

Just prior to the EIB's decision to finance the Cyprus LNG terminal, French newspaper Libération called into question the legitimacy of the contract tendering process and the allegedly inflated cost of the project. Referring to an internal EIB project document, Libération contended that the handling of the tender process amounted to a no-bid contract. The document stated that two other offers had been rejected "before any detailed, technical and financial assessment", with the Chinese-led consortium then being awarded the project contract. The same EIB document noted that: "The price of the project puts it in the high end for such a scheme."[40]

Cypriot energy analyst Charles Ellinas expressed similar concerns in local media at the time, adding doubts over whether the Chinese-led consortium had the technical expertise to deliver the project.[38]

Construction problems

In February 2022, an investigation by the Cyprus Mail revealed a litany of technical and construction problems dogging the project which have left construction progress considerably behind progress at 4% complete, according to sources. There is ongoing speculation that the Chinese contractors are seeking additional funds of between €25 million and €100 million to cover cost overruns. The President of Cyprus, Nicos Anastasiades, has urged the project's development to be sped up and, in light of the problems hampering the project, a new completion date of July 2023 has been proposed by the contractors.[41] The new July 2023 completion date may be optimistic owing to the extent of the project's difficulties which have been stirring debate in Cyprus.[42]

Further complications for the project's development were also reported by Cypriot media in February 2022 as large quantities of illegally dumped toxic and radioactive chemicals were found at the site of the proposed terminal. The chemicals were reported to be buried deep into the ground, which will make it difficult to extract them, and a further complication is that Cyprus does not have facilities to dispose of such chemicals.[43]

Articles and resources


  1. UPDATED TYNDP 2022 List of Projects. ENTSOG. October 21, 2022.
  2. Natural Gas Infrastructure Company (ETYFA). LinkedIn. Accessed December 2022.
  3. "Vasiliko Port & LNG Terminal" (PDF). Cyprus Ports Authority. 2018. Retrieved July 4, 2023.{{cite web}}: CS1 maint: url-status (link)
  4. IGU (2023). "2023 World LNG Report International Gas Union". IGU. Retrieved July 19, 2023.{{cite web}}: CS1 maint: url-status (link)
  5. 2020 World LNG Report, page 102, International Gas Union, April 27, 2020
  6. "Management of LNG project has been 'tragic', audit office says (Updated) | Cyprus Mail". 2024-01-19. Retrieved 2024-02-01. {{cite web}}: External link in |website= (help)
  7. 7.0 7.1 7.2 Jean Christou, Completion of LNG project at Vasiliko delayed – yet again, Cyprus Mail, Feb. 22, 2023
  8. 8.0 8.1 EBRD supports decarbonisation of energy sector in Cyprus, European Bank for Reconstruction and Development website, Jul. 31, 2020
  9. 9.0 9.1 "". {{cite web}}: External link in |title= (help)CS1 maint: url-status (link)
  10. 10.0 10.1 Simone Tagliapietra and Georg Zachmann, "Egypt Holds The Key To The Eastern Mediterranean's Gas Future," Forbes, November 29, 2015
  11. Development of gas infrastructure in Cyprus European Commission, accessed December 2, 2019
  12. 12.0 12.1 "GIIGNL Annual Report 2021 (p 45)" (PDF). GIIGNL. November 2021.{{cite web}}: CS1 maint: url-status (link)
  13. "CyprusGas2EU". Ocean Finance. 2021. Retrieved July 5, 2023.{{cite web}}: CS1 maint: url-status (link)
  14. LNG Supply to Cyprus, Cyprus Ministry of Commerce, Industry, & Tourism presentation, 6 Apr. 2009.
  15. Cyprus to look at importing LNG, Cyprus Mail, 7 July 2016.
  16. Cyprus revives LNG import plans, Interfax Global Energy, 28 Oct. 2016.
  17. Cyprus extends tender deadline for LNG import facility, LNG World News, Jan. 25, 2019
  18. Shailaja A. Lakshmi China-led Consortium Bids for Cyprus LNG ENERGY: Energean ups the ante in bid to supply natural gas to Cyprus, Marine Link, August 25, 2019
  19. ENERGY: Energean ups the ante in bid to supply natural gas to Cyprus, Financial Mirror, November 19, 2019
  20. Chinese-led consortium to build Cyprus’ gas import terminal, Associated Press, December 13, 2019
  21. Gary Lakes, Cyprus enters LNG era with FSRU groundbreaking at Vassilikos, S&P Global, Jul. 10, 2020
  22. ANNEX to COMMISSION DELEGATED REGULATION (EU) …/... amending Regulation (EU) No 347/2013 of the European Parliament and of the Council as regards the Union list of projects of common interest, European Commission, Nov. 19, 2021
  23. 23.0 23.1 Elias Hazou, Work begins on LNG ship for Cyprus, Cyprus Mail, Nov. 9, 2021
  24. 24.0 24.1 24.2 "LNG project: Problems from the outset". Cyprus Mail. February 7, 2022.{{cite web}}: CS1 maint: url-status (link)
  25. "More delays for LNG terminal due to dumped chemicals". Financial Mirror. February 23, 2022.{{cite web}}: CS1 maint: url-status (link)
  26. Chrysanthos Manoli, Προς φιάσκο το LNG στο Βασιλικό, Philenews, Jan. 5, 2023
  27. Annie Charalambous, Impossible for Vassiliko LNG terminal to be completed by mid-2023, as pledged, in-Cyprus, Jan. 5, 2022
  28. "Construction of LNG jetty set to start | Cyprus Mail". Cyprus Mail. Retrieved 2023-01-18.
  29. 29.0 29.1 29.2 29.3 LNG Prime Staff (2023-03-06). "Cyprus FSRU conversion nearing completion in China". LNG Prime. Retrieved 2023-07-05.
  30. 30.0 30.1 "LNG project: Problems from the outset | Cyprus Mail". Cyprus Mail. Retrieved 2023-07-05.
  31. 31.0 31.1 31.2 31.3 "LNG project only 40 per cent complete | Cyprus Mail". Cyprus Mail. Retrieved 2023-07-05.
  32. "'Paying for sins of the past': trouble with LNG terminal | Cyprus Mail". 2024-01-31. Retrieved 2024-02-02. {{cite web}}: External link in |website= (help)
  33. Cyprus, Total sign MoU for LNG terminal, Reuters, 7 Nov. 2013.
  34. Cyprus Considers Eight Train LNG Export Terminal, GCaptain, July 12, 2013
  35. Cyprus: several factors to determine LNG development, LNG World News, 19 Apr. 2016.
  36. Cyprus President invites Israel to seriously consider exporting gas from Cyprus LNG plant, Famagusta Gazette, accessed July 2017.
  37. "At last, a bankable LNG project for Cyprus | Cyprus Mail". Retrieved 2022-06-29. {{cite web}}: External link in |website= (help)
  38. 38.0 38.1 Elias Hazou, After 15 years, we're still waiting for gas, Cyprus Mail, Jun. 14, 2020
  39. State aid: Commission approves State guarantee for the financing of the LNG terminal in Cyprus, European Commission, Dec. 8, 2020
  40. Jérôme Lefilliâtre, Chine : le gaz chypriote à portée de gain, Libération, Jun. 7, 2020
  41. Elias Hazou, LNG project: Problems from the outset, Cyprus Mail, Feb. 7, 2022
  42. Dr Charles Ellinas, Radical new choices may be needed for LNG imports, Cyprus Mail, Feb. 6, 2022
  43. More delays for LNG terminal due to dumped chemicals, Financial Mirror, Feb. 23, 2022

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