The European Public Prosecutor’s Office (EPPO) in Nicosia is running an investigation into the project for a liquefied natural gas (LNG) import terminal in Vasiliko, on suspicion of procurement fraud, misappropriation of EU funds and corruption, and is already scrutinising bank accounts.

The investigation began in March 2024, however on Wednesday it was made known that the EPPO had scrutinised bank accounts of politicians, current and former state officials and civil servants.

Although the EPPO had said it would not be making details public at this stage, Politis sources said the EPPO had filed a request at the Nicosia district court to lift bank account confidentiality and “very interesting” evidence is being examined at the EPPO headquarters in Luxembourg.

In response to the report, attorney-general George Savvides said on Wednesday the inquiry began on March 28, 2024, and that, according to EU regulations, the Cypriot authorities could not conduct a criminal investigation or intervention while the EPPO was conducting its own.

“If, at any point of its investigation, the EPPO deems that an aspect of a case under investigation does not fall within its jurisdiction, it informs the national authorities for any incidents that may constitute a punishable action, according to the respective national law,” Savvides explained.

On Tuesday, Savvides was represented by a Law Office official at a House energy committee meeting. He said the attorney selected was to his judgement the best to represent him at the meeting.

In its statement, the EPPO said the LNG project aims to create an entry point for natural gas to Cyprus, enabling the country to connect with the wider European gas market, and involves a cost of €542 million – of which approximately €101 million was financed by the Connecting Europe Facility (CEF) programme.

“The construction, which should have been concluded in December 2019, has not yet been completed,” EPPO said.

The investigation was initiated following the publication on January 19, 2024 of a report by the Audit Office, regarding possible violations during the procurement procedure and the subsequent execution of the public contract for the LNG project.

The European Court of Auditors and the European Climate, Infrastructure and Environment Executive Agency (CINEA) also sent reports to the EPPO. 

After receiving this information and examining it in detail, the EPPO has taken the decision to open an investigation, in order to inquire into the contracts awarded by the public authorities. 

Investigations are being conducted by the police, in collaboration with the EPPO offices in Nicosia. So far, the investigators have gathered hundreds of dossiers from ministries, government services and the Natural Gas Infrastructure Company (Etyfa), which managed the tender in question. Etyfa is a subsidiary of state-run Natural Gas Public Corporation (Defa) and the Electricity Authority (EAC).

Testimonies have also been received. According to Politis, the politicians and officials under investigation will testify last.

Neither the chief of police nor the auditor-general have any involvement in or briefing on the course of investigations and will not have a say in any prosecutions.

The EPPO is the independent public prosecution office of the European Union. It is responsible for investigating, prosecuting and bringing to judgment crimes against the financial interests of the EU.