Ministry pushing for DEPA-Shell agreement, guarantees sought

Long-running negotiations between DEPA, the public gas corporation, and Shell concerning the former’s acquisition of the Dutch firm’s 49 percent share of the EPA Attiki gas supply and EDA Attiki gas distribution ventures covering the wider Athens area, now well past a June 6 deadline agreed to by the government and country’s lenders, failed to produce a finalized agreement at a meeting yesterday, which was intended to be the closing session, and will require an additional session today.

Greece’s energy ministry is applying heavy pressure on DEPA for a finalized agreement, believed to be worth 150 million euros. Price is not the issue. Instead, the delay has been attributed to guarantees demanded by DEPA to ensure the deal will not be breached at a future date.

DEPA wants Shell’s full market withdrawal through terms that would block any future market reentry attempt by the Dutch firm, including indirectly, as a member of an investment scheme.

For its EPA Attiki joint venture with DEPA, the majority partner with a 51 percent stake, Shell was not represented directly or through a subsidiary but a special purpose vehicle (SPV).

During yesterday’s meeting, DEPA officials made clear there will be no final agreement unless protective clauses demanded by the gas utility are included in the deal.

DEPA is also pushing for a term that would safeguard the Greek gas utility against any pending issues that may arise in the future, including tax matters or accidents resulting from faulty infrastructure development. Shell has yet to agree to such commitments.

In parliament, Democratic Alignment MP Giorgos Arvanitidis tabled a question demanding a full update from energy minister Giorgos Stathakis on the Shell-DEPA negotiations, including the progress of talks and the level of significance of an agreement for the ensuing privatization of DEPA.

The energy minister was also asked to confirm whether a 150 million-euro price for the agreement has been set and, if so, provide details on the criteria used given the fact that the negotiations are still in progress.

Arvanitidis also questioned if DEPA shareholders have offered their approval and sought confirmation of an alleged 4 million-euro fee for Rothschild, the gas utility’s consultant on matter.