Our View: How much longer can government hedge on taking needful decisions on gas matters?

SOME NINE days ago, the Commerce and Industry Minister Antonis Paschalides told the Sunday Mail that the government was “getting closer to reaching a decision” on the type of terminal that would be built to handle our natural gas needs.

Despite getting closer to a decision the minister still could not say whether the government would be importing compressed or liquefied natural gas for the Electricity Authority’s (EAC) power stations. “We are looking at all options,” he said.

The Electricity Authority meanwhile, has been waiting for the government to take a decision for months now.

The possibility of signing a contract for an offshore terminal to supply Cyprus is now on the cards and appears to have further complicated matters for the government.

Yet this seems to be a good temporary solution as everyone expects Cyprus to be able to use its own natural gas in five to 10 years. The unit price may be a bit higher, but EAC would not have to invest in building a big terminal that would require four to five years to complete.

Last week top executives from the Texas-based company Noble Energy were in Cyprus for meetings with the government and said they hoped to have results of the first well they would drill in Block 12 by the end of the year. They also discussed how a gas discovery could be monetised.

Nobody knows what the government has in mind, with regard to monetisation of gas finds. It has yet to respond to a proposal by the Israeli government for the construction of a gas liquefying facility in Cyprus from where LNG could be exported to Europe.

Paschalides told the Sunday Mail that the government hired “the best consultants in the world” to help it formulate a strategic energy plan.

But the truth is that the consultants cannot take the decision that need to be taken, on behalf of the government. They could explain different options as well as the pros and cons of each one, but the final decisions must be taken by the government.

Would it reject Israel’s proposal for a joint LNG venture, would it allow EAC to sign a short-term contract for the supply of natural gas, does it know how it would monetise a gas discovery and does it have a plan for dealing with possible external political pressure?

None of the above has been answered yet. How much longer does the government plan to be looking at all options, without taking any decisions?

The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.