Israeli, European investors eye Cyprus LNG terminal, says project head

Israeli and European investors have displayed an interest in financing a liquefied natural gas terminal on Cyprus, the head of Cyprus’s national hydrocarbons company said on Tuesday.

Cyprus plans to build a $6 billion LNG terminal on its southern coast to process natural gas from offshore fields now under development. Authorities hope the prospect of gas finds can spur growth on the recession-hit island which recently required an EU and IMF bailout.

“We have 3 serious financial options to look into. This makes us confident that we can start the construction of the Vasiliko LNG plant in 2016,” said Charles Ellinas, head of the island’s national hydrocarbons company, CNHC.

Ellinas, in Brussels for a conference, told Reuters that in addition to European and Israeli investors, investors from the “Far East” had expressed an interest in acquiring LNG in return for an investment in the plant. A third financing option for the terminal was project finance with energy companies licensed to search for gas, he said.

“We will hold serious discussions with investors early next year,” Ellinas said.

US energy company Noble is due to start an appraisal drilling imminently to verify a 2011 discovery of 5-8 trillion cubic feet of gas. The Ensco 5006 rig was moved into position south-east of Cyprus earlier this week.

Two other companies, France’s Total and Italy’s ENI plan drillings off Cyprus by 2015. [Reuters]