A series of major energy-sector projects worth an estimated five billion euros have been caught amid the crossfire of contrasting political outlooks in the run-up to the country’s early general elections. At this stage, it seems that, at best, a number of revisions will need to be made to various plans following the elections.
The TAP (Trans Adriatic Pipeline) infrastructure project to carry natural gas from Azerbaijan to Europe, via Greece, Albania, and the Adriatic Sea, is a stand-out example of the political impact on the country’s energy-sector plans. The main opposition leftist Syriza party, ahead in polls, has not endorsed the plan, and promises to strive for a number of revisions. The party has already declared it intends to renegotiate the agreement, possibly for increased participtation by the Greek state in a consortium formed to develop the gas pipeline, as well as greater royalty payments. These intentions, alone, create an entirely new context for the project, whose budget is valued at 1.5 billion euros.
Also, the long-delayed 400 million-euro DESFA privatization, now being examined by the European Commission as a result of its concerns over the Azeri company Socar’s move into the EU market, through a 66 percent acquisition of DESFA, is another issue likely to change course following the upcoming Greek elections.
It was recently reported that a Syriza delegation’s trip to Azerbaijan for talks with local government officials on various issues, including the DESFA deal, prompted Azeri officials to accept maintenance of the network’s control by the Greek State.
The planned privatization of PPC (Public Power Corporation) subsidiary firm IPTO, the Independent Power Transmission Operator, through a 66 percent sale of its equity share for between 600 million and 900 million euros, is another deal that would probably stop rolling with Syriza at the country’s political helm. Furthermore, the part-privatization of PPC, through the sale of a 30 percent share of the corporation for an estimated 1.5 billion euros, as well as the planned sale of a 17 stake in PPC to a strategic investor, can both also be expected to be stalled by a new Syriza government.
The picture is also hazy for the propsects of two hydrocarbon exploration international tenders currently in progress. Syriza has voiced clear objections to the model implemented. Local politics aside, the sector now also finds itself under dark clouds as a result of plummeting crude oil prices over recent months in the international market, which has forced companies to cut back on investment plans.