Cyprus will use a converted Shell-controlled LNG carrier as a floating storage and regasification unit for its upcoming import project.
Symeon Kassianides, who is chairman of state energy company DEFA, said the consortium of China Petroleum Pipeline Engineering Co, Metron, Hudong-Zhonghua Shipbuilding Group and Wilhelmsen Ship Management will buy a 17-year-old, G-class LNG carrier from Shell Tankers.
Kassianides told the CWC World LNG Summit in Rome that the vessel, the 136,967-cbm LNG carrier Galea (built 2002), will be converted into the FSRU. The conversion will be done by Hudong-Zhonghua.
New vehicle Etifa, which is 70% controlled by DEFA and 30% by the Electricity Authority of Cyprus, has been set up to own the FSRU, a 1.3-km jetty and landside infrastructure.
Kassianides said a contract covering this infrastructure is due to be signed by Etifa and the selected consortium by the end of December.
First gas from the facility is targeted for January 2022.
The new terminal will be able to accommodate visiting LNG carriers of up to Q-Flex size ships of around 215,000-cbm capacity.
The DEFA chairman said the cost of the new facility is €300m ($333m), of which €100m comes from a European Commission (EC) grant.
He said that the way the EC grant is structured means the terminal developers are "almost driven to purchase the boat."
Once the infrastructure contract is inked, DEFA will move on to finalise finance for the facility.
Next year the developers will launch tenders for supply for the terminal which will have capacity for around 1bn cbm of LNG per annum and launch an open season for the facility.
Kassianides told delegates that this is the 10th anniversary for Cyprus of trying to bring LNG to the island and said 2020 could finally be the year that this is achieved once contracts are signed.
He said it is a project that is needed and will transition and transform the economy of Cyprus, where to date heavy fuel oil has been used for power generation.
