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Professor Michael Economides, a Cypriot born expert on energy issues has said the option available for Cyprus when considering to import natural gas for its energy needs, is compressed natural gas (CNG).
“Anybody talking about importing liquefied natural gas (LNG) is making assumptions without justification, since LNG does not make economic sense and it will never happen,” said Economides during a public debate on natural gas import organised and hosted by SFS Group Public Co.
In a direct response to a question by Financial Mirror on why Cypriot politicians are not rushing to sign on the CNG option, which according to Economides and a panel of experts makes economic, environmental and speed of execution sense, Economides said, “the LNG argument is as silly and ridiculous as the other idea that made the rounds last year when some people were proposing the floating unit solution as a temporary option before land-based LNG storage facilities would be built.”
In fact Economides challenged anybody to sign the contract for the importation of LNG to Cyprus and then he would beat the price by at least 25%.
According to the panel of exports at the SFS organised event, the import of LNG would be expensive and complicated, capital and energy intensive and made very little sense for short-haul volume trade, while CNG was ideal for Cyprus due to the island’s close proximity to the gas source and absence of pipeline connection as well as its limited demand compared to other countries.
“Building a pipeline direct from the supply source would be ideal, but because the water depth near Crete and Cyprus goes as deep as 3.000 metres, you cannot lay a pipeline. End of story, which is why Cyprus has no other choice but to import CNG through the use of ships,” said Economides.
Quick solution
The other experts at the SFS event, Patrick Chaney, Manager for Gas Ships in the Ship Sector Development Group for the American Bureau of Shipping (ABS), as well as David Stenning, President and CEO of Sea NG Corporation, a world leader in marine compressed natural gas (CNG) transportation, agreed that CNG is the best option for Cyprus to consider, and insisted that the 4-5 ships needed to import the CNG from Libya or Egypt would take 1-3 years to build and there would be no need to build costly storage facilities as they would shuttle in and out, bringing a constant supply of gas to Cyprus.
“CNG carries fewer environmental risks, does not need expensive terminals, is not a technically complicated system, has flexibility in loading and unloading options – meaning that it could deliver gas to more than one power plant -, options that are not available to LNG. Also Cyprus is less than 400 km away from one of the biggest natural gas suppliers in the world, Egypt,” Stenning said.
CNG could also be supplied to water desalination plants now being planned to be built, but also used to supply transport and meet other energy needs.
Third world country
Economides said he is surprised when he observes that in some areas, mostly in the private sector, Cyprus is a first rate country with Cypriots competing head on with giant multinationals, yet in other fields it relies on outdated technology and systems.
“It’s ridiculous for Cyprus to use diesel to produce electricity, which means Cyprus is by far the most expensive producer of electricity in Europe but at the same time it pollutes the atmosphere and does not meet the EU carbon emission reduction targets.”
Economides claimed he was shocked and surprised at some of the “supposed facts that were being thrown around by the media and politicians in Cyprus”.
“You can have your opinion, but you cannot make your facts,” he said, adding that those coming up with stupid arguments were definitely thinking of their own pockets.
The outspoken energy analyst, nicknamed as the ‘$100 barrel guy’ after predicting three years ago that the price of oil would exceed a hundred dollars per barrel and well known in the USA for his accurate predictions in the energy sector, said he is a minority shareholder in a US-based LNG import company, pointing that he does not have anything against LNG, but stressing that for Cyprus such an option “is suicidal.”
Blunt but at the same time fair, Prof. Economides said he would be interested to participate in a future alliance to bring CNG to Cyprus, which would make a “lot of economic sense” calling on SFS to also get into the act.
