Cyprus’ attempts to import gas as an interim solution until Aphrodite comes on line have come to a dead end. This was decided at a meeting at the presidential palace February 7. The key participants at the meeting were the energy minister, the regulator Cera, the gas company Defa and the electricity company EAC.
The government rejected as unfavorable the proposal of the Dutch company Vitol. It said Vitol wanted to sell about a quarter more than the originally proposed quantities. This would benefit Vitol, but could increase Cyprus’ risk of being left with quantities of gas it could not use, in a "take-or-pay" contract. Moreover, there could be a risk that losers would argue that the rules of the tender had changed, benefiting Vitol.
In any case, it is understood that Defa’s tender evaluation did not demonstrate any benefits to Cyprus. This is because the low oil price would negate any savings in the production of electricity from gas.
