Financial Analysis of Wastewater Treatment Plant in Famagusta – North Cyprus

The aim of this study is to explore the unit cost of treated wastewater that farmers may be willing to pay per cubic meter for irrigation purposes in other to give up the use of underground water. For this, an appraisal for the wastewater treatment plant was undertaken using the cost-benefit analysis approach. The appraisal assesses solely the financial and sensitivity analysis to enable an efficient long term feasibility and sustainability of the wastewater treatment plant. The financial analysis conducted shows that the FNPV of the treated wastewater plant is positive and significantly large enough to generate high returns on investment for the municipality. Therefore, we can say that, the treatment plant project is feasible and it will be able to generate sufficient cash flows. Also, based on the sensitivity analysis results, it appears that the variables under observations are not sensitive enough to affect the FNPV of the project. At the end of this study, it was found that farmers in Gazimagusa – North Cyprus are paying higher for purifying wastewater (0.39 euros per cubic meter) when compared to what is obtainable by farmers in the South Cyprus (0.15 EUR per cubic meter) of treated wastewater.