Stepped up negotiations are underway between Greek and Cypriot officials regarding the 1.9 billion euro Great Sea Interconnector project, 657 million of which is funded by the European Commission. This project involves a power cable linking the grids of Greece, Cyprus and Israel, paving the way for the energy interconnection of the three countries.
The Cypriot side is scrutinizing every aspect of the project, reportedly demanding guarantees and assurances for the total cost of the endeavor. During a meeting held last Tuesday in Nicosia, the parties agreed to continue with the negotiations, though no final agreement was reached.
The delay is attributed to the fact that Cypriot power regulators want to ensure that they will not have to provide additional funding down the line nor will Cypriot consumers incur losses should the project ultimately be abandoned.
When asked to comment on criticism from opposition parties that his government is not decisive enough regarding the electrical interconnection, Cypriot President Nikos Christodoulides said, ‘We are talking about a major project that concerns future generations, which is of interest to us. Therefore, our decisions will be prudent and take into account all the data.’
He further pointed out that on Sept. 19, he is to meet with the Greek Prime Minister, in Athens, and that one of the key issues on their agenda is this project. ‘We are in daily contact—yesterday, the day before yesterday—about this matter,” he emphasized.
This comes on the heels of a significant intervention by Israel’s Energy Minister, highlighting the geopolitical stakes involved, with Israel’s Minister of Energy and Infrastructure, calling the Minister of Energy, Commerce, and Industry of the Republic of Cyprus, regarding the interconnection.
Moreover, the American factor cannot be overlooked, as the U.S. is pressuring for the project to proceed.
Meanwhile, from the podium of the 88th Thessaloniki International Fair, Greek Prime Minister Kyriakos Mitsotakis outlined the government’s policy, stating that “the project will proceed if its economic viability is ensured and any geopolitical risks will be overcome,” implying that geopolitical risk could be addressed later.
However, the Cypriot side is not moving forward with resolving the regulatory pending issues—linked to geopolitical risks that could affect the project’s implementation and the timeframe for recouping costs—which are prerequisites for the French company Nexans not to suspend the cable’s construction.
Ultimately, the primary issue causing tension in the negotiations between Greece and Cyprus regarding the Great Sea Interconnector project seems to be the cost allocation between the two countries, rather than the geopolitical risks involved.
