Filenews 28 May 2024 - by Chrysanthos Manoli
Both the government and the Chinese side have realized that the current impasse cannot continue for long. However, the scope for compromise to bridge all financial differences and complete the project and deliver it for use to ETYFA by CPP is non-existent.
Neither side is abandoning its stronghold. CPP insists we have to pay... twice the initial amount for the construction of the terminal, while the Cypriot side claims that even if the Republic of Cyprus had the gold to give, the terminal cannot be completed by this company!
The prospect of CPP resuming work on the Vasilikos pier is highly unlikely. Neither it seems to want it, either CPP or the Republic of Cyprus. However, both sides realize that small movements are needed to limit the damage to both.
Under these circumstances, what may be discussed in the coming period is the negotiation of separate parts of the project, so that the inability to find a consensual solution on all aspects of the dispute does not prevent agreement being reached on the parts of the project for which the difference is not large.
All information converges that the only part of the overall project that is at an advanced stage of completion is the floating liquefied natural gas regasification unit (FSRU). Therefore, the delivery of the ship to the Republic of Cyprus (which paid for it almost 100%) is the highest priority for the state.
The completion of the overall project by CPP is no longer something the Government is looking forward to and is not something that CPP is interested in. The Chinese company, however, knows that the instrumentalization of the ship Prometheus in order to blackmail the state into paying it the exorbitant amounts it asks for (about €200 million), without even the decision of the arbitrator in London, cannot be done without serious consequences for itself, as such a stance will lead the Republic of Cyprus to file a formal complaint with the competent EU bodies. so that the company is excluded from other projects in EU countries, together with its (Greek and Norwegian) partners in the consortium.
There is no official information from state authorities for the time being, but what seems to be the most likely scenario for the next period is the negotiation of the two sides for the delivery, if anything, of the ship Prometheus to ETYFA. The remaining disputes will remain before arbitration in London. Something CPP doesn't seem to like much anymore.
The Chinese are raising increased financial demands for the ship (a few tens of millions of euros), although Prometheus has not yet been certified by Lloyd's Register even as an LNG carrier, let alone as a floating regasification plant.
What Phileleftheros understands is that an attempt will be made in the near future to find a financial compromise for the ship alone, so that it can be handed over to ETYFA and the two sides will divorce. And ETYFA will look for other partners to complete the pier.
But this is not easy either. As the Republic of Cyprus considers that its contractual financial obligations for the ship are very limited, while CPP requires approximately €30 million, the Commission will be able to meet the requirements of the European Union. It does not take responsibility (which costs another €10-15 million) for the certification of Prometheus as a floating regasification plant.
