ELPE seeks new ways to raise 212m anticipated from DESFA sale

ELPE (Hellenic Petroleum), which, as a 35-percent shareholder of DESFA, Greece’s natural gas grid operator, had anticipated 212 million euros in revenues from the operator’s sale to Azeri energy company, Socar, a deal long-stalled by a European Commission investigation, is now seeking alternative ways to raise this sum, company officials announced at a general shareholders meeting today.

The European Commission is believed to be examining various options for DESFA, including placing for sale a 49-percent share of the company instead of 66 percent, as had been originally planned by the previous Greek government.

Along with ELPE’s 35 percent stake, the Greek state was selling its share of 31 percent of DESFA, before the deal was stalled by European Commission investigation over EU competition and energy security concerns.

Confirming earlier energypress reports, ELPE officials today also announced the Greek petroleum company will submit a bid for offshore block “number one” in the northwest Ionian Sea, being offered as part of an international tender for a total of twenty sea plots in the Ionian Sea and south of Crete. The tender is scheduled to expire on July 14, if a deadline extension is not granted. The prospect has been strongly rumored as a result of the subdued interest expressed so far.

Although the specific block in the northwest Ionian Sea, towards Albania, does not offer tremendous energy potential for ELPE, the petroleum company will submit a bid as a means of reinforcing the country’s exclusive economic zone (EEZ) rights, following discussions with the Foreign Ministry, ELPE’s chief executive Grigoris Stergioulis noted at today’s meeting.

Commenting on the dramatic and ongoing bailout talks between Greek officials and the country’s lenders, Efstathios Tsotsoros, ELPE’s chairman, noted that: “If concluded, the process will restrict uncertainty, although the measures being discussed may affect economic growth. Everything is up in the air. We hope it ends favorably.”

Tsotsoros, who, along with Stergioulis, was appointed just several weeks ago to co-run ELPE, said the corporate group’s strategy includes a further boost in export activity, from fifty percent of production at present; transforming the group into a major East Mediterranean force; and increasing its retail share from thirty percent to forty percent over the next five years.

Increased exports at ELPE over the past few years have compensated for a major domestic slowdown caused by the Greek recession. The group’s sales in Greece have fallen by 42 percent since 2009.

The corporate group intends to decrease its debt level by 2017. Measures here will include sales of non-strategic interests.