Eight Foreign Companies Want to Complete the Vasiliko LNG Terminal

On Friday, October 9, state-owned company ETYFA completed the collection of expressions of interest from companies seeking to finish construction of the liquefied natural gas (LNG) terminal at Vasiliko in Cyprus. The project is considered one of the key pieces of the country’s energy infrastructure. Its purpose is to receive liquefied natural gas, regasify it and then supply it for electricity generation. Completing the project would allow Cyprus to diversify its energy sources and gradually reduce the dependence of its power plants on petroleum products.

Which companies want to complete the Vasiliko LNG terminal?

Eight companies and consortia from several countries submitted applications. The bidders include major international contractors with experience in energy, industrial and infrastructure projects. The list includes:

1. Saipem (Italy) — an international company specializing in engineering solutions and the construction of energy infrastructure.
2. China Harbour Engineering Company (China) — a state-owned construction company that submitted an application jointly with Cyprus-based Cyfield. This bid is not directly connected with the Chinese company CPP, which was involved in the original project.
3. Baran International (Israel) — the international arm of Baran Group, one of Israel’s largest engineering and construction groups.
4. Petrojet (Egypt) — a major engineering and construction company operating in the oil and gas sector.
5. Terna (Greece) — a construction company involved in major infrastructure and energy projects.
6. AVAX (Greece) — a contractor specializing in infrastructure and industrial construction.
7. Archirodon (Greece) — an international engineering and construction company with experience in infrastructure and energy.
8. ECOnnect Energy (Norway) — a company specializing in technology solutions for energy projects.

It is worth noting that the Greek companies Terna, AVAX and Archirodon already have experience working in Cyprus. The participation of international contractors gives ETYFA the opportunity to compare different technical approaches and commercial proposals.

Why are Israel and Egypt interested in the project?

Particular attention is being drawn to the bids from Israel’s Baran International and Egypt’s Petrojet. Cyprus, Israel and Egypt are located in one of the key natural gas regions of the Eastern Mediterranean. Cooperation among the three countries is linked to the development of natural gas fields, gas supplies and energy infrastructure. For Israeli and Egyptian companies, participation in completing the Vasiliko project could provide an opportunity to strengthen their position in the region and secure a new infrastructure contract.

However, submitting an application does not mean that these companies have already agreed on gas supplies to Cyprus or reached agreements on participation in future energy projects. At this stage, only their interest in completing the terminal has been confirmed. The preliminary budget for the remaining work is €180 million. The specific amounts proposed by individual bidders and their construction schedules have not yet been disclosed.

Why has construction of the terminal been delayed?

The Vasiliko LNG terminal is intended to become an important part of Cyprus’s energy system. Construction was originally awarded to a consortium that included the Chinese company CPP. The contract was later terminated, and the project ran into serious difficulties. The delays forced Cyprus to revise the timetable for bringing the terminal into operation and raised questions about the use of previously allocated European funding.

State-owned ETYFA is now trying to identify a contractor capable of completing the work. In preparing the tender, the company is working with France’s Technip Energies, which has served as project management consultant since May 2025. ETYFA is a subsidiary of the Cyprus Natural Gas Public Company (DEFA) and is responsible for developing the infrastructure needed for the use of natural gas on the island. The new contractor selection process is intended to determine which companies are prepared to complete the project under acceptable financial and technical terms.

When will a contractor be selected, and how could the terminal affect electricity prices?

ETYFA is now expected to evaluate the interested parties and decide which companies will be invited to the next stage — the preparation of full bids. The tender conditions are being developed with the participation of Technip Energies. No date has yet been announced for completion of the selection process or the signing of a contract. For Cyprus, bringing the LNG terminal into operation is highly important. The island’s energy sector currently remains heavily dependent on petroleum products, which are expensive and produce significant pollutant emissions. Switching to natural gas for electricity generation could potentially provide several benefits:

1. Lower emissions. Burning natural gas produces less carbon dioxide than fuel oil, although gas is still a fossil fuel.
2. Energy diversification. LNG import infrastructure would expand the options available for supplying fuel to power plants.
3. Potential cost reductions. More favorable gas supply terms could reduce the cost of generating electricity.
4. Reduced dependence on petroleum products. This would allow Cyprus to change the structure of its energy fuel mix.

However, lower electricity tariffs are not guaranteed. The final cost of electricity will depend on gas purchase prices, transportation costs, terminal operating expenses and other components of the energy market. Completing the Vasiliko LNG terminal therefore remains an important objective for Cyprus’s energy security.