The European Bank for Reconstruction and Development (EBRD) has agreed to provide €80m ($94.2m) funding to Natural Gas Infrastructure Company of Cyprus (ETYFA) to acquire a floating storage and regasification unit (FSRU).
The funding will be utilised by ETYFA for the development of the infrastructure relatd to FSRU.
Permanently anchored approximately 1.3 km off the coast of Limassol in Vasilikos Bay, the FSRU will be directly connected to the adjacent Vasilikos power station.
According to EBRD, the project is a critical component in the energy strategy of Cyprus that will provide significant energy security, environmental and economic impacts.
FSRU will replace heavy fuel oil with cleaner natural gas in Cyprus
It is said that nearly 90% of the electricity supply in the island depends on the importation of petroleum products. The island’s energy system is isolated, without any interconnections for electricity or gas.
The new project is expected to replace expensive and polluting heavy fuel oil with cleaner natural gas in the country.
EBRD Energy Europe, the Middle East and Africa head Harry Boyd-Carpenter said: “This is a milestone project for Cyprus and we are proud to support it.
“The project will be a major step forward in Cyprus’s decarbonisation trajectory. It will reduce both global and local pollution without compromising the island’s long-term transition to a low-carbon energy sector.”
In addition to loan from EBRD, EU is also providing a €101m ($118.9m) of funding for the project under the Connecting Europe Facility.
The remaining project costs will be met through a €150 million loan from the EIB and a €43 million equity contribution from the Electricity Authority of Cyprus (EAC).
Recently, ETYFA has awarded a contract to Hill International to provide owner’s engineer services for the Cyprus LNG import terminal project.
The project includes a former LNG carrier with a storage capacity of 136,000 cubic meters that will be converted to FSRU in China.
