Gas grid operator DESFA is determined to push ahead with the development of a natural gas pipeline in northern Greece’s west Macedonia region, a project budgeted at 110 million euros, either with financial support from the EU’s current National Strategic Reference Framework or other financing solutions, including bank loans, if the project is ultimately excluded from EU recovery fund support.

Though a finalized decision on the list of projects to receive EU recovery fund support has not been reached, DESFA, according to energypress sources, will proceed with this pipeline project, part of the operator’s ten-year development plan for 2021 to 2030, totaling 545.5 million euros.

In examining its financing options for this gas pipeline project, DESFA will take decisions based on containing network usage fees to be paid by consumers.

The European Commission and European Investment Bank (EIB) no longer finance conventional gas-based infrastructure projects, unless eco-friendly hydrogen is incorporated into their plans. Even so, the west Macedonia gas pipeline has been included in the recovery fund catalogue as the project is linked to the post-lignite era.

Possessing a clearly developmental role with multiple benefits for the wider region, the pipeline represents part of the energy transition plan for west Macedonia, a lignite-dependent local economy, as it will help replace lignite-based energy, contribute to growth, and support the region’s industry.

The pipeline, to stretch 130 km, could be swiftly licensed, DESFA officials believe, as long as its financing plan is settled and municipal and regional authorities acknowledge the region’s gas penetration need. The pipeline’s delivery was forecast for within 2023 before questions concerning the project’s financing emerged.