Energy ministry to stage new DESFA tender offering 66%

The energy ministry has decided to stage a new tender for the sale of DESFA, the natural gas grid operator, offering a 66 percent stake, as was also the case with the initial long-running procedure that eventually collapsed late last year.

Prior to this latest decision, the ministry spent a couple of months examining inapplicable solutions such as the continuation of the preceding tender, in a bid to save time, or staging a tender that would retain 51 percent stake of DESFA for the Greek State.

Energy minister Giorgos Stathakis has now come to realize that there is no other option than to stage a new tender, energypress sources have informed.

This procedure will require between 16 and 18 months to complete, leaving a gap in this year’s planned privatization revenues, inevitable following the government’s failure to finalize a deal with Azerbaijani energy firm Socar, which emerged as winning – and only – bidder for a 66 percent stake of DESFA in 2013 at a price of 400 million euros.

Subject to ensuing revisions, including revenue-limiting measures, the Azerbaijani energy firm officially withdrew its interest on November 30 after refusing to extend a letter of guarantee for a third successive month.

If it were legally possible to continue the initial tender, the ministry anticipated it would have saved at least five months from the overall process. This time period will now be needed for preliminary work such as appointing an adviser and announcing the new tender.

Over the past few months, it had become somewhat of a common secret among energy sector insiders that DESFA’s administration acted as a key proponent in pushing the energy ministry towards seeking a continuation of the initial tender, the aim being to make the most of advanced talks with Belgium’s Fluxys.

Dutch operator Gasunie and Fluxys are among the candidates expected to express an interest in the follow-up DESFA tender. Offers for the operator’s 66 percent will most probably fall short of the 400 million euros offered by Socar in the initial procedure.