A leading US law firm has advised the Cyprus government to seek further technical and financial assessments before committing to a €2 billion electricity interconnector project with Greece’s power grid operator IPTO, according to documents seen by Reuters.
Curtis, Mallet-Prevost, Colt and Mosle LLP recommended that Cyprus should verify “beyond any doubt” whether the proposed interconnector would deliver its promised benefits, including lower electricity prices and green power export capabilities.
The firm outlined five key recommendations:
The government should conduct additional technical and economic evaluations as proposed by Cyprus’s energy regulator CERA.
Cyprus should inform IPTO that its proposed concession agreement for Great Sea Interconnector (GSI) is unacceptable and requires fundamental revision.
Any investment structure should be based on a joint venture model with equal decision-making powers between Cyprus and IPTO.
Before Cyprus commits to any investment or financial support, including a proposed €100 million share purchase, GSI must secure adequate capital and willing investors to meet all funding requirements.
IPTO should disclose all relevant contracts, including agreements with Nexans and Siemens, correspondence with the EU’s CINEA mechanism regarding the €658 million grant, and communications with the European Investment Bank about a potential €500 million loan.
The legal advice comes amid growing scrutiny of the project’s viability and governance structure, with particular concern over Cyprus’s potential financial exposure if the venture fails to secure full funding.
Read more:
