The main contractor of the stalled liquefied natural gas (LNG) import terminal at Vasiliko, CPP-Metron Consortium (CMC), has accused the Cyprus Natural Gas Infrastructure Company (ETYFA) of inexperience, systematic payment delays, scope changes, and mismanagement, which it says brought the project to a standstill.
In a lengthy and strong-worded statement issued on Thursday, the consortium led by CPP sought to clarify what it described as “false and inaccurate” statements by ETYFA surrounding the €500m project.
CMC said it remained willing to cooperate in good faith so “the Project can be responsibly completed” despite the “fundamental differences” with ETYFA that have led it to a standstill. On the dispute with ETYFA over unpaid amounts and extra works, however, CMC clarified that arbitration was already underway at the London Court of International Arbitration (LCIA).
Disputed timeline and delays
CMC argued that the project was hampered from the outset, with the contract signed in December 2019 but only formally commencing ten months later due to “unavailable funds” and delays in appointing ETYFA’s engineer. The consortium further claimed ETYFA pressed it to purchase and convert a vessel into a floating storage and regasification unit (FSRU) before adequate oversight was in place.
“Did ETYFA have the relevant knowledge, experience and expertise to handle such a project? Clearly not,” said CMC.
It further argued that chronic underpayments, and therefore cashflow, became the key source of contention, forcing it to suspend works in January 2024. CMC accused the energy minister of political interference through his public statements on the issue. However, after getting assurances from the minister of timely payments, the consortium resumed work in March 2024. When further payments failed to materialise, CMC terminated the contract in July 2024.
Scope changes and technical disputes
Beyond finances, the consortium accused ETYFA of “weaponising” payments to push for scope changes, including a cryogenic jetty (to export LNG) not required for Cyprus’ energy needs, which added over €100m in costs. It also criticised ETYFA engineers for lacking the expertise to oversee such a project, contributing to systematic delays in design approvals. ETYFA’s alleged refusal to hold meetings with the Chinese contractor CPP to resolve these issues led the consortium to seek arbitration in London in February 2023.
CMC rejected allegations of design flaws, equipment safety risks, or an incomplete FSRU, stressing that all components and designs were pre-approved by ETYFA and the project’s engineer, Hill International. Where a defect was found, the contractor accepted and assumed all liabilities, said CMC.
On claims that the FSRU vessel is incomplete or missing critical components, “These claims are false.”
It cited Lloyd’s Register certification confirming the vessel’s readiness in January 2024 and dismissed claims of missing parts as inaccurate.
On the well-publicised narrative in the media that the contractor was holding the vessel to ransom, CMC said: “This is a complete false and inaccurate statement. The FSRU belongs to the Owner since June 2022.”
The consortium further accused ETYFA of being “incapable, incompetent and unprepared to receive the FSRU”, while “trying to resort to spreading false and inaccurate statements and conducting communication trickery”.
Project handover dispute
Following contract termination, CMC said ETYFA barred its staff from the site and ignored repeated offers to conduct a formal handover of completed works and procured materials. This, it warned, leaves uncertainty over the condition and accountability of assets now under ETYFA’s control.
Looking ahead
Despite a breakdown in relations, CMC reiterated its willingness to maintain dialogue “out of a sense of responsibility to Cypriot taxpayers” and “to explore ways and solutions for the project to be completed as soon as possible”. Concluding, CMC underlined its “commitment to transparency and responsible cooperation”.
As of Thursday afternoon, the government and ETYFA have not yet responded publicly to the contractor’s detailed rebuttal.
On Tuesday, Energy Minister George Papanastasiou told the House Energy Committee that the government is expecting in the coming days to receive a report by project manager (French firm Technip) on how to proceed with the Vasiliko terminal.
Meanwhile, as part of its ongoing investigation into the tender for and management of the Vasiliko terminal project, the European Public Prosecutor’s Office (EPPO) has moved to open the bank accounts of politicians, current and former state officials, and public servants under court orders.
The probe concerns possible fraud, misuse of EU funds, and corruption during both the tendering process and management of the project, which secured €101 million in European financing.
The full CPP announcement can be read here.