French investment has failed to ease Nicosia’s concerns, with some officials now looking to Israeli gas instead.
The agreement making French company Meridiam the majority shareholder in the company behind the Cyprus-Crete electricity interconnector has done nothing to ease the Cypriot government’s reservations about the project.
Nicosia’s delayed response to the celebratory mood in Athens when the deal was signed suggests the Cypriot side may have been caught by surprise. This raises major questions about the level of communication between Nicosia and Athens, as well as between Nicosia and Paris.
Government sources told Kathimerini that French involvement cannot guarantee Cyprus will join the GSI investment scheme...the country should instead look towards Israel to secure its energy supply.
Beyond that, however, the latest developments raise a more fundamental question: Does the Cypriot government genuinely support a project that will largely shape the country’s energy future?
Despite the energy minister’s late and lukewarm assurances of support, comments being made behind the scenes by government officials suggest Cyprus may be moving away from the project designed to end its energy isolation.
Attention instead appears to be shifting towards other options that sit outside the European Union’s strategy for a shared European energy-security system.
Supporters of a common European energy network suspect that the concerns repeatedly raised by Nicosia—including geopolitical risks and the need to update the project’s financial figures—may be serving as a way for Cyprus to distance itself from the GSI.
That impression is not being well received outside Cyprus. It may also shed light on the political thinking behind the removal of former Energy Minister George Papanastasiou, a strong supporter of the interconnector.
Risk of being left on the sidelines
If current indications are confirmed and Nicosia no longer sees the electricity interconnector as its main route out of energy isolation, the consequences could extend well beyond the energy sector if the project is eventually completed without Cyprus’ participation.
The Republic of Cyprus was absent from a major moment for the project: the transfer of the controlling stake in GSI to Meridiam. That absence is certain to have created a negative political impression in both Athens and Paris.
A senior government official told Kathimerini that Cyprus had received no prior information about the Greek-French deal. The official played down its importance, describing it as a straightforward share transaction that does not change the Cypriot government’s position.
According to the same view, the agreement supports those in Nicosia who have repeatedly questioned whether the project is financially viable.
The Finance Ministry, which has been the main government body opposing the project, continues to follow its original position: it will not approve funding for the Republic of Cyprus to join the group of investors that would commercially operate the cable.
This means Cyprus risks being left on the sidelines of a project that directly concerns the country and could help establish it as a regional energy hub connected to Europe.
Doubts over the French role
Behind the scenes, government sources are also questioning the argument made in Athens that Meridiam’s involvement provides stronger protection against the project’s geopolitical risks, particularly those created by Turkish challenges in the waters between Kasos and Cyprus.
According to information obtained by Kathimerini, some within the government doubt how firmly France would respond to what they describe as Turkey’s unlawful and provocative claims.
They believe the French group may have invested in the project but could ultimately seek Turkey’s permission before carrying out the remaining seabed surveys. Those surveys are needed to update the project’s financial calculations and map the route along which the cable would be laid.
This view is completely at odds with the position expressed by Athens after the agreement.
The Greek side does not deny that geopolitical risks exist. However, it believes French involvement strengthens the political protection around the project and helps reinforce the application of international law.
These doubts are particularly striking at a time when relations between Cyprus and France are enjoying a prolonged period of close cooperation at every level.
Athens appears unhappy
According to information from the Greek capital, the agreement was prepared and finalised between Greece and France. By the time it was announced, it appeared to have been presented to Cyprus as a done deal.
The Greek government has not publicly responded to the messages coming from Nicosia, which suggest the Meridiam deal has failed to change Cyprus’ reservations.
However, the mood in Athens appears to be one of dissatisfaction.
Speaking to Kathimerini last Sunday, Constantinos Filis called on the Republic of Cyprus to make its position clear, despite Nicosia’s official welcome for the French company’s involvement.
“I am not certain at this moment that the entire Cypriot government is 100% committed to this project,” he said. “There are also business interests that have fought against the GSI, even though the project’s main purpose is to end Cyprus’ energy isolation and reduce electricity prices.”
Israeli gas pipeline instead of GSI
Those opposed to the electricity cable are also challenging its central argument: that it would strengthen Cyprus’ energy security.
They point to incidents in the Baltic Sea, where energy infrastructure has been damaged, and argue that the cable would be an immediate target if tensions with Turkey escalated.
At the same time, views are beginning to emerge within the government that Cyprus should focus on Israel to secure enough electricity for its needs.
This alternative would involve bringing natural gas from Israel through a pipeline which, according to its supporters, Israel would be capable of protecting if necessary.
The same plan would aim to increase renewable energy’s share in Cyprus to 50%, supported by the installation and operation of energy-storage systems.
If all this is achieved, government officials argue that Cyprus could eventually produce more electricity than it knows what to do with.
