Defa Faces Scrutiny Over Budget and Transparency Issues

Title: Cyprus Lawmakers Question Defa’s Management and Transparency Amid Budget Approval

In a recent parliamentary session, the Natural Gas Public Company (Defa) faced criticism from lawmakers over concerns of mismanagement and lack of transparency. The scrutiny came as Defa sought approval for its €38 million budget for 2024, marking its first financial plan since transitioning from private to public law governance.

Defa, which holds the exclusive rights to import and distribute natural gas in the Republic of Cyprus, is requesting the creation of 36 new positions within the organization. Despite the call for expansion, state funding for Defa has been reduced to €12 million, a significant decrease from the previous year’s €18 million.

The 2024 budget includes a notable allocation of €20.5 million for investments in subsidiaries, specifically earmarked for the equity of the Natural Gas Infrastructure Company (Etyfa). Etyfa is tasked with developing the liquefied natural gas (LNG) terminal in Vasiliko, a project that has faced numerous delays and disputes with the contractor. Despite these challenges, infrastructure related to the LNG terminal is expected to be completed within the year.

Once operational, Defa’s importation of natural gas is projected to bring in substantial revenues, with future LNG sales estimated at €500 million annually. However, progress has stalled at the Vasiliko construction site for over a month due to ongoing disagreements with the Chinese-led consortium responsible for the project.

Kyriacos Hadjiyiannis, chair of the House energy committee, expressed dissatisfaction with Defa’s operations, highlighting the absence of a job description and organizational chart despite previous promises. Defa officials have been summoned to address these issues before parliament, along with questions regarding EU funding and personnel concerns.

In parallel, the parliamentary committee commenced review of the 2024 budget for the RES & Energy Conservation Fund, which anticipates €19.4 million in revenues from a fixed consumption fee.

As Defa navigates these challenges, stakeholders and citizens alike await further developments on the LNG terminal project and Defa’s role in Cyprus’s energy landscape.

Natural Gas Public Company (Defa)

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