Snam officials in Athens pushing for DESFA deal completion

A team of officials representing Snam, the Italian energy firm heading an all-European gas operator consortium named the preferred investor for the acquisition of a 66 percent stake of DESFA, Greece’s natural gas grid operator, is in Athens to apply pressure for the completion, as soon as possible, of pending issues leading to the deal’s finalization.

Spain’s Enagás Internacional and Belgium’s Fluxys are the consortium’s two other members.

One of four pending issues, a stalled agreement between DESFA and Fyrom (Former Yugoslav Republic of Macedonia) state-run energy company MER Skopje for the development of a pipeline interconnection intended to link the gas grids of the neighboring countries, appears to have regained momentum. Snam has pushed for the DESFA-MER agreement to be sealed.

DESFA and MER Skopje signed a Memorandum of Cooperation for the project in 2016 but Greek licensing procedure delays and an initiative taken last year by Russian entrepreneur Leonid Lebedev’s Windows International Hellas for a license to construct a rival natural gas pipeline from Thessaloniki to Fyrom, slowed down the process. RAE, Greece’s Regulatory Authority for Energy, still needs to make a final decision.

Another pending issue, DESFA’s corporate split from gas utility DEPA, is the most challenging of all. DESFA will also need new certification, as a national gas grid operator, under its new ownership.

Tariff revisions represent the fourth pending issue. DESFA has proposed a WACC figure of 9.27 percent but RAE does not appear keen to offer its endorsement. The authority has made note of the WACC figure at IPTO, the power grid operator, ranging between 7 and 7.5 percent.