The Republic of Cyprus (ROC), located at the crossroads of Europe, Africa, and the Middle East, offers opportunities for U.S. energy and energy-sector service providers in the areas of consulting, environmental assessment, offshore hydrocarbon exploration and exploitation, supply of natural gas for domestic use, and basing of auxiliary energy services for the wider region. Currently, the island is powered almost exclusively by heavy fuel oil and limited renewable energy sources. The government is making efforts to import natural gas for domestic use. The ROC is planning to increase its deployment of renewable energy to meet EU Green Deal goals and to avoid significant EU carbon emission penalties (please see separate section on renewable energy). It is also proceeding with the construction of a liquified natural gas (LNG) import plant with a Floating Storage and Regasification Unit (FSRU). Exploration and exploitation of natural gas deposits in the ROC’s Exclusive Economic Zone (EEZ) have slowed due to COVID-19 but resumed this year and are expected to continue into next year. In 2014, the Republic of Cyprus ended the state-owned Electricity Authority of Cyprus’s (EAC) monopoly on electricity generation and distribution. Promoting competition remains difficult given the small size of the domestic market. The Cyprus Energy Regulatory Authority (CERA), in cooperation with the Transmission System Operator (TSO) and other energy stakeholders, is working to alleviate competition constraints in the power generation sector. Although new market rules for the Competitive Energy Market (CEM) are already partially implemented, CERA announced full implementation will likely occur in 2023.
The U.S. Embassy Political/Economic team can assist any company interested in pursuing energy opportunities in the Republic of Cyprus. For more information on the energy landscape, please contact Commercial Specialist Ms. Ephie-Yvonnie Charalambidou.
Leading Sub-Sectors and Opportunities
Bunkering Infrastructure Development / Port Facilities:
The Poseidon Med II project promotes the adoption of LNG as a safe, environmentally efficient, and viable alternative fuel for shipping. The project supports bunkering for the ROC, Greece, and Italy. The Cyprus Ports Authority (CPA) is a partner in the project. The Ministry of Transport, Communications, and Works is planning the extension of the Vasilikos port to facilitate bunkering and other shipping and energy-related services. It is seeking investors for a Finance, Design, Build, Operate, and Transfer project.
Construction and Development of a National Transmission and Distribution Natural Gas Pipeline Network:
Education – Energy-Related Degrees from Cypriot Universities in Collaboration with U.S. Universities:
With the discovery of offshore hydrocarbons in the ROC’s EEZ and the deployment of renewable energy sources on the island, many local universities are designing curricula and degree programs in hydrocarbons, petroleum engineering, and related sectors. Cypriot universities are interested in establishing linkages with U.S. universities specializing in these and related fields.
Ministry of Energy, Commerce, and Industry – Hydrocarbon Services Department