The Cypriot government rejected the offer of the Russian Itera to supply natural gas as an interim solution for power supply.

The process for dealing with the interim natural gas supply offers was decided at the presidential palace today, among the president, the energy minister, the natural gas public company DEFA the energy regulator CERA and the public electricity authority EAC.

They decided the Itera’s offer was unprofitable. Consultations will now involve Vitol, the second bidder for the supply of natural gas.

Speaking to reporters after the meeting, the energy minister George Lakkotrypis referred to today’s meeting chaired by President of the Republic, which focused on the interim solution of natural gas transfer.

Talks were part of the effort and desire of the President to cut electricity prices, leading to a more competitive economy, it was stated.

The meeting discussed the recent decisions of the board of DEFA (the natural gas public company) and as government , according to the law, we received the independent opinion of the energy regulator CERA .

According to CERA, both the assumptions of electricity authority EAC and the outcome of the decision process of DEFA are reasonable.

By extension, DEFA can now take decisions to the benefit of the organization and the public interest in general“.

Asked if the proposal for an interim solution was unprofitable, the Minister said that it has been confirmed by CERA that the assumptions and the result are reasonable, while invited to say what are the next steps he said the relevant documents have been submitted to the President.

On the question whether there will be new negotiations with the second bidder , the Minister said this is up to DEFA.

He argued they will examine more options if the desired electricity cut expected from the use of natural gas, instead of petrol, is not achieved.

On a question about DEFA’s options, its Chairperson, Elena Vasiliadou said; “We will follow all legal procedures based on the Board decisions. Since we have a competition and we have signed confidentiality agreements, allow me not to go into details”.

“According to the procedure, we can go to a second or a third bidder”, she said.

“What we actually have now is not profitable. We are trying to move as fast as we can. But there are issues of correct procedures, techno- economic issues, this is all too serious, we must move quickly and judiciously “, she added.

“I hope that in a few weeks we will able to know if we can move forward with the data we have in front of us or not. It might take days. This will depend on the process”.

“It is very difficult because our consumption is small and has declined due to the crisis conditions. We need infrastructure increasing the cost of importing natural gas as an interim solution, due to the limited time until we have our own gas.

The conditions are very difficult, but not impossible. If the specific gas suppliers and can give a satisfactorily low price, it could work. That depends on our bidders”, she stressed.

On his part, CERA Chairman, Giorgos Shammas said CERA monitors the results of DEFA procedure. “CERA has examined the data and has submitted its independent opinion at today's meeting. The conclusion is that- based on current data – the country is not driven to a substantial price cut”, he said.

Finally , the Director General of EAC, Stelios Stylianou said "today's meeting was a confirmation of the correctness of the data and the way the Authority works regarding the calculation of production costs."

“EAC worked professionally to find the right solution for the country's interests."

The meeting, under Nikos Anastasiades, was attended by Energy Minister George Lakkotrypis and members of the Board of DEFA , CERA and the DG of EAC