Dutch company Gasunie, according to comments offered by an official of the Azeri firm to azernews, is the latest candidate reported as being interested in acquiring a 17 percent of DESFA, Greece’s gas grid operator, which the main prospective buyer Socar will need to give up.
If true, this could provide new impetus to the long-delayed process. In the same article, the Socar official confirmed the withdrawal of Belgian company Fluxys from DESFA’s sale, while Azeri sources forecast the preocedure will be finalized by the end of 2016.
Socar had agreed to purchase a 66 percent stake of DESFA after winning an international tender in 2013 before the European Commission intervened to demand that the Azeri company surrender 17 percent to a certified European operator. This would leave Socar with a 49 percent stake in DESFA.
But, following much delay, the deal’s prospects of completion have been severely diminished, for a variety of reasons, including the deterioration of Azerbaijan’s energy-dependent economy amid plunging oil and gas prices over the past year and a half. All sides involved in the DESFA deal are suspected of seeking ways out of the process without being held accountable for its incompletion.
For the time being, all sides seem to still be working on a deal. Within the next two months, Greek officials are expected to finalize their revision of DESFA’s pricing policy regulations, which, as a result, will reduce a prospective gas network usage price hike to far less that the 30 to 35 percent permitted by the current terms. The Greek government wants to avoid a major price increase, fearing the political cost of such a development. According to sources, the Azeri firm is prepared to accept this revision.
Once DESFA’s pricing regulation has been revised, the next step will be to keep the process alive by renewing Socar’s gurantee, which expires in September, as a finalized deal stands little chance of being completed by then.
Latest developments indicate that Italy’s Snam remains interested in the 17 percent to be surrendered by Socar. Snam did not include a representative in an Italian business delegation that traveled to Athens recently, sparking assumptions that it was no longer interested in the DESFA deal. On the contrary, sources said Snam is carefully examining DESFA company data which it holds, while also maintaining open communication with Socar.
Socar, the aforementioned azernews article reported, considers its acquisition of a stake in DESFA as a move of major significance for Azerbaijan, as this would provide control of a European gas company and heighten the role played by Socar on the EU’s energy security front.