Cyprus Halts €1.2 Billion Larnaca Port Deal Over Contract Breach

Cyprus has canceled a €1.2 billion concession for Larnaca port development, citing a breach of contract by Kition Ocean Holdings. The port, crucial for international aid to Gaza, will revert to state administration. The failure to renew a project guarantee was the primary reason for termination.

Cyprus has scrapped a 1.2 billion euro ($1.30 billion) concession agreement for the development of Larnaca port, claiming on Monday the operator awarded the project in 2020 was in breach of contract. Operator Kition Ocean Holdings, which held a long-term lease to develop and operate both a yachting marina and a commercial port in the southern port town, did not immediately respond to a request for comment.

Larnaca is the staging post of a maritime shuttle of international aid into Gaza. The issue would not affect activity at the port, government officials said. The consortium had failed to renew a letter of guarantee for the project which legal authorities considered a contractual breach, Transport Minister Alexis Vafeades said.

"This effectively activates a process where the port and the marina... are reverting to the administration of the state," Vafeades said. ($1 = 0.9208 euros) (Writing by Michele Kambas; Editing by Jan Harvey)