Hello,
We are facing a following issue when trying to create a workspace based on VCS.
APP versions:
Terraform Cloud Free
Gitlab CE v16.x
Gitlab EE is exposed to the internet and the integration is all-green:
When creating a workspace I can see the projects listed:
However, when I try to create a workspace, following error occurs:

The gitlab user is an admin, as outlined in GitLab EE and CE - VCS Providers - Terraform Cloud | Terraform | HashiCorp Developer .
Has anyone else ran into this problem and knows how to solve it?
Regards,
Luke

