EU backs expansion of strategic energy storage in Cyprus
- Release date: 31 May 2018
- Reference: 2018-134-EN
- EIB confirms EUR 35 million support for new emergency oil reserve facility
- Vasilikos facility providing one month storage
- First public sector investment in Cyprus backed by Investment Plan for Europe
The European Investment Bank today confirmed EUR 35 million of new financing for expansion of strategic oil reserves in Cyprus. Management of strategic oil reserves in Cyprus will be transformed through construction of a new EUR 53 million emergency energy facility enable Cyprus to hold one month of emergency oil supplies. The new EIB financing represents the first infrastructure scheme in Cyprus to be supported by the Investment Plan for Europe initiative.
The new European Investment Bank support for crucial energy infrastructure in Cyprus was formally signed in Nicosia earlier today by Jonathan Taylor, European Investment Bank Vice President responsible for lending operations in Cyprus and Panagiotis Malekos, Chairman of KODAP, the Cyprus Organisation for Storage and Management of Oil Stocks, in the presence of Giorgos Lakkotrypis, Minister of Energy of the Republic of Cyprus.
“The European Investment Bank has been a key partner for energy investment in Cyprus for more than 40 years. New EIB support for emergency oil storage at Vasilikos confirmed today will ensure critical energy infrastructure in a modern and safe facility. The EIB’s unique technical experience and financial expertise gained from backing energy investment worldwide has strengthened the Vasilikos scheme.” said Giorgos Lakkotrypis, Minister of Energy of the Republic of Cyprus.
“Investment to ensure security of energy supply is crucial to avoid disruption and safety of strategic facilities. The European Investment Bank is pleased to work with Cypriot partners to transform critical energy storage at Vasilikos. This is an impressive project that demonstrates best practice and world class safety standards. The EUR 35 million long-term EIB financing represents our largest support for energy investment in Cyprus for more than 5 years and is the first infrastructure project in Cyprus backed by the Investment Plan for Europe.” said Jonathan Taylor, European Investment Bank Vice President.
Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: "The EU's Energy Union strategy aims to make energy more secure and affordable. This first EFSI project in Cyprus with KODAP will help us meet those goals. I encourage more project promoters in Cyprus to contact the EIB with their investment proposals in order to continue boosting growth and creating jobs."
Crucial national emergency oil reserve for Cyprus
The twenty-year long-term European Investment Bank loan will finance a new six tank 200,000 cubic metres oil storage facility at Vasilikos on the southern coast of the island, as well as firefighting, fencing, pipelines, security and roads at the new site. The Vasilikos terminal will hold the bulk of oil reserves owned by the Cyprus Organisation for Storage and Management of Oil Stocks.
“Improving emergency energy storage on-shore is in line with best practice and crucial for Cyprus, an inland nation at the South eastern corner of the Mediterranean. The Vasilikos storage facility is a key infrastructure project for our country. The new backing from the European Investment Bank reflects the quality and importance of the project and builds on a strong tack record of support for energy investment in Cyprus.” said Panagiotis Malekos, Chairman of KODAP, the Cyprus Organisation for Storage and Management of Oil Stocks.
Once operational in 2020 the new Vasilikos facility will allow storage of one month of oil supplies for Cyprus and contribute towards compliance with a European obligation to store oil reserves equivalent to 90 days of energy needs.
First infrastructure project backed by the Investment Plan for Europe
The project is the first infrastructure scheme in Cyprus supported by the EUR 500 billion Investment Plan for Europe initiative. The new Vasilikos facility will be financed by the European Investment Bank under the Investment Plan for Europe, using a guarantee from the European Fund for Strategic Investments.
Strong track record of supporting investment in Cyprus
The European Investment Bank has supported energy, education, transport, health, water and small business investment in Cyprus since 1981. This has included providing more than EUR 818 million for energy investment in wind energy, power distribution and transmission, energy efficiency and security of energy supply projects.