Preliminary DEPA privatization procedures lacking urgency

Preliminary procedures needed for the privatization of DEPA, the Public Gas Corporation, are not making satisfactory progress, officials monitoring the procedure have observed.

A formula for a reduction of the gas utility’s retail gas market presence has been established, but beyond that, little progress has been achieved. Officials at the finance ministry and TAIPED, the state privatization fund, are still awaiting the next vital step leading to this plan’s actualization, dependent on DEPA and its two supply and distribution partners Shell and Eni.

For quite some time now, DEPA and Shell have agreed on a road map for the former’s acquisition of the latter’s 49 percent stake in EPA Attiki and EDA Attiki supply and distribution ventures covering the wider Athens area. DEPA currently holds a majority 51 percent stake. However, as the weeks go by, the two sides have yet to agree on a sale price for the stakes held by Shell in these ventures.

DEPA and Shell have agreed on an evaluation formula concerning this transaction, as well as a back-up plan should there be any disagreement on the price.

The two sides are expected to have agreed on a sale price by the end of March, according to the bailout schedule. The evaluation process leading to this price tag has yet to be launched in earnest.

Besides the Shell partnership, DEPA also needs to finalize a deal with Italy’s Eni, which holds a 49 percent in EPA Thessaloniki-Thessaly. DEPA intends to sell all or most of its 51 percent share in this venture to Eni. DEPA’s future in EDA Thessaloniki-Thessaly remains unclear.

Alternative plans supported by the energy ministry for DEPA’s privatization appear to have waned, meaning that an initial plan for a strategic investor to acquire the Greek State’s 65 percent stake in DEPA will be pursued.

The finance ministry’s position on the DEPA privatization, as well as that of ELPE (Hellenic Petroleum) is pivotal. Finance Minister Euclid Tsakalotos is well aware of how seriously the lenders view these privatizations for the bailout procedure, including prospective relief measures.

A lack of cohesion amid the government’s ranks on the privatizations has become apparent. Just days ago, when he emerged from a meeting with lenders on the privatizations, Tsakalotos, when enquired about the DEPA alternatives proposed by Stathakis, the energy minister, responded: “Ask him”.