TAP’s commercial launch now on the final stretch

The Trans Adriatic Pipeline (TAP) project, to enable the delivery of Caspian gas to destinations throughout southeastern, central and western Europe, is almost ready for its commercial launch, four years after construction began and 17 years after its first feasibility study was conducted.

The project, running from the Shah Deniz gas field in Azerbaijan, will represent the EU’s main alternative route for natural gas, greatly contributing to the end of the continent’s dependence on Russian gas, supply security and intensified competition.

The TAP project will begin operating at a capacity of 10 billion cubic meters, annually.

Greece was the first of the project’s host countries to complete its segment of construction work, a 550-km stretch across northern Greece, from Evros’ Kipoi area in the northeast to Ieropigi in the Kastoria province, at the Greek-Albanian border.

Just days ago, Greece’s energy ministry approved the operation of the project’s Greek segment, running from Evros to Rodopi, Xanthi, Kavala, Drama, Serres, Thessaloniki, Kilkis, Pella, Imathia, Florina, Kozani and Kastroria.

Authorities of the project’s two other host nations, Albania and Italy, will soon grant their respective operating permits, sources informed.

The project’s commercial launch is expected to take place close to the final quarter this year, the energy ministry has announced.

The Greek and Italian gas grid operators, DESFA and Snam, respectively, will need to prepare their national grids so that natural gas quantities can reach consumers via TAP, sources added.

 

Six Greek heavyweights among DEPA Commercial contenders

Six major Greek energy market players are among the contenders through to the second round of the DEPA Commercial sale, the biggest domestic turnout for an energy-sector tender in recent years, highlighting the gas market’s significance and prospects over the next decade.

The country’s energy transition plan is aiming for zero emissions by 2030.

Hellenic Petroleum (ELPE), joined by Italian partner Edison, a Motor Oil and power utility PPC partnership, Mytilineos, Gek-Terna and the Copelouzos group are the six Greek contenders, among a list of seven bidding teams shortlisted for the DEPA Commercial sale’s final round, entailing binding bids.

Gas utility DEPA, from which DEPA Commercial has been established for the utility’s privatization, may have lost its monopoly in the natural gas market, but its assets and market share promise the new owner a leading position during Greece’s decade of decarbonization, electric vehicle market growth and drastic reduction in fuel consumption.

As a result, fierce bidding for DEPA Commercial is expected.

The company’s acquisition will provide the new owner with a portfolio of 350,000 customers plus DEPA Commercial’s international supply contracts with Russia’s Gazprom, supplying pipeline gas to the Greek company for years; Algeria’s Sonatrach, supplying LNG; and Turkey’s Botas.

Gas quantities from Azerbaijan have also been reserved by DEPA Commercial via the imminent TAP route.

 

 

 

Turkey’s Botas delivers ICC retroactive €200m sum to DEPA

Turkey’s state-run crude oil and gas company Botas yesterday paid in full a retroactive sum to Greek gas utility DEPA following its recent legal victory at Stockholm’s ICC (International Court of Arbitration) in an overcharging case against the Turkish company, the Greek utility has announced.

The sum paid by Botas to DEPA, believed to exceed 200 million euros, settles a nine-year dispute.

The ICC verdict was delivered on January 10. Botas has since begun transmitting natural gas to DEPA at a lower price level, making the utility far more competitive. Its existing gas transmission contract with Botas expires in 2023.

The dispute began when DEPA claimed the Turkish company was overcharging the Greek utility for its purchases of Azerbaijani natural gas delivered through Turkish pipelines since 2011.

A considerable percentage of the amount paid by Botas to DEPA will be returned to the gas utility’s customers who, by extension, had been overcharged as a result of Botas’ inflated pricing policy. DEPA is expected to be left with a considerable amount, still undetermined.

The development comes as a boost for DEPA, whose privatization procedure has been launched.

“This is very good news coming at the most appropriate time now that the company’s privatization procedure is in progress,” noted deputy energy minister Gerassimos Thomas.

 

DEPA wins Botas case at ICC, retroactive cash boost expected

The ICC (International Court of Arbitration) has issued a favorable verdict for gas utility DEPA in a case against Botas, Turkey’s state-run crude oil and gas company, challenging price increases of Azerbaijan natural gas supplied to Greece by the Turkish firm since 2011, the Greek gas utility has announced.

DEPA took its case to the ICC seeking to have a previous ruling overturned. The resulting retroactive cash inflow for the Greek gas utility could be close to 200 million euros. Also, the ICC decision will secure DEPA a lower supply price from now on, enabling a favorable revision of the gas utility’s prices offered to customers.

The legal dispute between DEPA and Botas stretches back to 2008 and has produced a variety of intermediate situations and verdicts.

The latest round was initiated in August, 2016 when DEPA submitted a price-revision request to Botas for a lower gas supply price.

Balkans-focused energy forum on eve of Thessaloniki fair

Two key regional gas pipeline projects involving Greece and backed by the US, the Greek-Bulgarian IGB gas grid interconnection and a pipeline to link Greece and North Macedonia, will be at the center of attention in talks between energy minister Costis Hatzidakis and peers at the Southeast Europe Energy Forum in Thessaloniki on September 6, a day ahead of the opening of this year’s Thessaloniki International Fair.

Hatzidakis and the US Ambassador to Greece, Geoffrey R. Pyatt, will be key speakers at the forum, where speeches will also be delivered by the energy ministers of Bulgaria, Cyprus, Israel, North Macedonia, Romania and Serbia.

Besides the prospective gas pipeline from Greece to North Macedonia, the talks between Hatzidakis and his North Macedonian peer will also focus on an upgrade of the electricity grid interconnection linking the systems of the two countries, as well as an upcoming relaunch of the Okta oil pipeline, stretching from an ELPE (Hellenic Petroleum) facility in Thessaloniki to the company’s Okta refinery and storage facility in North Macedonia.

The gas pipeline is the most important project of the three as an interconnection of the Greek and North Macedonian gas systems does not exist.

The Greek-Bulgarian IGB gas interconnection, along with TAP, to carry Azeri natural gas through northern Greece, Albania and across the Adriatic Sea to central Europe via Italy, are Greece’s two most significant international energy projects.

They promise to further diversify Europe’s energy sources and weaken Russia’s dominance in the region.

Meanwhile, Russia is promoting its own energy and geopolitical interests in the region. Last month, Greece was excluded from Turkish Stream, a Russian-Turkish gas pipeline plan whose second segment is now planned to run through Bulgaria, not Greece.

The first segment of this gas pipeline project is planned to supply Russian natural gas to the Turkish market and the second to Europe’s south and southeast.

 

Greek, Cypriot, Israeli officials seeking Italy’s East Med return

Greek, Cypriot and Israeli officials are working on details of a plan aiming to win back Rome’s support for the East Med pipeline, an ambitious 1,900-km pipeline to carry southeast Mediterranean natural gas from Israel to Europe via  Italy.

Efforts by Washington and Brussels to lure back Italy, whose coalition government has withdrawn the country’s support for the project, are pivotal.

Part of the overall diplomatic effort may be unveiled at an Athens energy summit today.

The Greek, Cypriot and Israeli energy ministers, Costis Hatzidakis, Giorgos Lakkotrypis and Yuval Steinitz, respectively, as well as US Assistant Secretary Francis Fannon, are taking part in the summit.

Fannon held successive meetings in Athens yesterday with Greece’s energy minister and the deputy foreign minister Konstantinos Fragogiannis. The East Med project’s promotion was a key subject of these meetings, especially Fannon’s talks with Hatzidakis, Greece’s energy minister.

Last May, Italian Prime Minister Giuseppe Conte, heading Italy’s right-wing populist coalition, declared Rome does not want the East Med pipeline to land on Italian territory. Instead, he proposed the pipeline’s link to TAP, another gas pipeline project being developed to carry Azerbaijani natural gas to Europe, via Italy.

East Med is envisioned to primarily carry deposits from Cyprus’ recently discovered “Aphrodite” gas field and the Israeli-controlled block “Leviathan” along a route stretching from Israel to Europe, also via Italy.

In response to Italy’s stance, Israel now appears to favor an alternate route for East Med that would avoid ending up on the Italian coast. Experts regard this prospect as difficult but not impossible as the pipeline project is still at the planning stage. Greece and Cyprus prefer Italy’s incorporation into the pipeline route.

 

 

DEPA-Cheniere LNG supply deal negotiations reach advanced stage

Gas utility DEPA and US energy exporter Cheniere have reached an advanced stage in negotiations for a long-term LNG supply agreement that could result in a five-year deal, according to sources.

A 150,000-cubic meter spot-market purchase made by DEPA from the Texas-based company towards the end of last year kindled the current negotiations for a longer-term agreement between the two sides, energypress sources informed.

The US has made clear its interest to establish Greece as a gateway for American LNG into Balkan markets. The US Ambassador to Greece, Geoffrey R. Pyatt, has often made reference to the prospect.

A supply agreement between DEPA and Cheniere would further diversify the Greek gas utility’s sources, currently dominated by Russian natural gas and LNG from Algeria.

DEPA has reserved a one-billion cubic meter capacity through the TAP route as of 2020, when the new gas pipeline carrying natural gas from Azerbaijan is expected to begin operating. The prospect should enable DEPA to offer domestic-market customers more competitive prices and further penetrate Balkan markets, via the IGB Greek-Bulgarian pipeline, to connect with TAP.

The ongoing DEPA-Cheniere talks have not swept Algeria’s Sonatrach out of the picture, sources stressed. DEPA’s current supply agreement with Sonatrach expires in 2020 and the two sides are already discussing a renewal.

DEPA agreements with Cheniere and Sonatrach, combined with Azerbaijani gas supply through TAP, promise to place the Greek gas utility in a more favorable position opposite Russia’s Gazprom, its main supplier.

PPC gearing up for gas market entry, seeking alternative supply sources

The main power utility PPC is intensifying its efforts for a natural gas market entry as an alternative business activity in the wider energy sector to compensate for anticipated losses to result from its disinvestment of lignite units and electricity market share contraction, both required by the bailout agreement.

“The natural gas market is changing rapidly. We also want to enter the retail gas market,” PPC’s chief executive Manolis Panagiotakis told a parliamentary committee yesterday.

The PPC boss made clear the power utility’s intentions to look for alternative supply sources, beyond the gas utility DEPA. An older nine-year supply agreement with DEPA expires on December 31, 2020.

“We are already preparing ourselves for the period beyond the [current] DEPA agreement,” Panagiotakis informed. “LNG has arrived and Azerbaijani gas will soon also be here. We, too, want to connect with these sources. That’s our strategy,” he added.

PPC has also made arrangements to utilize the upgraded LNG terminal on Revythoussa, an islet just off Athens.

PPC ranks as one of the country’s biggest natural gas consumers. The power utility is expected to consume 15.7 million MWh of gas in 2019 to fuel four power stations, Aliveri V, Megalopoli V, Lavrio IV and Komotini. The corporation also requires gas amounts to begin trading in the country’s retail gas market.

 

DEPA seeking improved terms for Gazprom, Sonatrach supply

DEPA, the public gas corporation, is making an effort to renegotiate contracts with its two main suppliers, Russia’s Gazprom and Algeria’s Sonatrach, for improved terms, energypress sources have informed, as a result of market condition changes.

Besides supplying DEPA, Gazprom now also sells directly to other major customers in Greece, such as the Mytilineos group, a development reshaping the country’s natural gas market.

DEPA’s chief executive Dimitris Tzortzis and Gazprom Export deputy director Elena Burmistrova are believed to have discussed the subject at a meeting in St Petersburg last month. Officials of the two gas companies are expected to stage a new meeting in St Petersburg this week, sources informed.

DEPA officials will seek to improve the terms of the Greek gas utility’s existing Gazprom gas supply deal to help offset the Russian firm’s new dealings with other customers in Greece.

DEPA already appears to have ensured an exemption from a take-or-pay clause requiring payments for unconsumed amounts specified in supply contracts. DEPA is also pushing for a lower price but Gazprom officials do not appear willing to discuss such a prospect.

However, DEPA does appear to stand a chance of being granted a right to resell a proportion of gas amounts purchased from Gazprom in Balkan markets.

DEPA is also seeking to improve the terms of its supply deal with Algeria’s Sonatrach, the Greek gas utility’s second biggest source, supplying LNG.

Tzortzis, the DEPA boss, was in Algeria earlier this month for talks with Sonatrach officials on supply security concerning the Greek market in 2019, as well as supply price and pricing formula issues.

At these talks, Sonatrach officials pressured for price hikes as a result of higher international gas prices, but the DEPA boss insisted Algerian LNG needs to remain competitively priced as TAP-pipeline natural gas stemming from the Azerbaijani section of the Caspian Sea will begin entering the Greek market in 2020. A contract ensuring one billion cubic meters per year of Azerbaijani natural gas supply to the Greek market has already been signed.

As is the case with Gazprom, DEPA is also pursuing the right to resell a portion of its Sonatrach gas purchases to foreign markets.

DEPA intends to terminate a third gas supply contract held with Turkey’s Botas in 2020, a year ahead of its expiry date, as the terms of this agreement are regarded as being  unfavorable in view of the imminent supply of Azerbaijani gas to Greece via the TAP pipeline. Though talks between DEPA and Botas have not been held, an extension of their contract has already been ruled out.

Gazprom and DEPA currently hold a supply agreement for 2.6 billion cubic meters per year, until 2026. Sonatrach supplies the Greek gas utility between 0.55 and one billion cubic meters per year based on a contract expiring next year, when DEPA’s deal with Turkey’s Botas, supplying 0.75 billion cubic meters per year, also expires.

 

 

DESFA sale finally appears to have been achieved, six years on

A total of roughly six years, two international tenders, political upheavals and European Commission intervention were needed to conclude the apparent 66 percent sale of DESFA, the natural gas grid operator.

TAIPED, the state privatizaton fund, yesterday named a consortium led by Italy’s Snam and including Spain’s Enagás Internacional and Belgium’s Fluxys as the preferred bidder, following its 535 million-euro second-round offer.

DESFA’s two sellers, TAIPED, selling 31 percent on behalf of the Greek State, and ELPE (Hellenic Petroleum), selling 35 percent, have accepted the offer.

It also needs to be endorsed by the Court of Audit as well as the competition authorities in Athens and Brussels. Pundits do not anticipate any surprise developments, as was the case with the preceding DESFA tender, whose preferred bidder, Azerbaijan’s Socar, faced issues.

Socar had offered 330 million euros for a 66 percent stake of DESFA, five years ago, when Greece’s country risk factor was higher. Also, the operator’s current cash deposits, estimated at around 200 million euros, are considerably greater than they were during the previous sale effort.

ELPE stands to receive 283.7 million euros, while TAIPED will receive 251.2 million euros from the Snam-led consortium’s 535 million-euro offer.

Snam, Fluxys and Enagás hold 20 percent, 19 percent and 16 percent stakes, respectively, in the TAP consortium that is developing the Trans Adratic Pipeline, to supply natural gas from Azerbaijan to central Europe, via Turkey, Greece, Albania and Italy. Its launch is expected in 2020. The consortium’s trio sees DESFA as a platform for wider regional interests.

 

 

 

 

DEPA appeal against Botas for retroactive hike starts today

An ongoing gas price dispute between DEPA, the Public Gas Corporation, and Botas, Turkey’s state-run crude oil and gas company, will continue at a Stockhom court, where the case was transferred today.

DEPA filed this case against Botas in an attempt to have a previous ruling favoring the Turkish energy company lifted. The verdict, which vindicated a retroactive gas price increase by Botas for its Azerbaijani gas supply, called for a 180 million-euro payment by DEPA to Botas.

The case goes back approximately ten years when Botas had demanded a retroactive payment – from 2008 onwards – of 300 million euros for various natural gas pricing discrepancies. DEPA refused to pay this sum. Ensuing negotiations failed to deliver results and Botas took legal action in 2011.

Though the Turkish company’s demand for a 300 million-euro payment was reduced to 180 million euros by this court decision, DEPA still considered the sum to be excessive. Even so, the payment was completed in September, 2016 but DEPA followed up with an appeal at the Swedish court. This appeal case begins today.

It is not the only pending legal case submitted by DEPA against Botas. Last July, the Greek gas utility took legal action against Botas seeking a retroactive price revision to a contract signed by the two sides for Azerbaijani gas supplied to DEPA.

This case, submitted to the ICC in Paris, is based on two requests made by DEPA to Botas for price revisions, the first in 2011 and the second in 2016.

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DEPA payment case against Botas to be heard this month

A legal case filed by DEPA, the Public Gas Corporation, against Botas, Turkey’s state-run crude oil and gas company, in an attempt to lift a previous ruling in favor of Botas, which had called for an 180 million-euro payment to the Turkish enterprise for various natural gas pricing discrepancies between the two sides, is expected to be heard before a Swedish court in two to three weeks.

Botas had demanded a sum of around 300 million euros in retroactive payments for outstanding amounts resulting from various natural gas price revisions as far back as 2008. DEPA rejected the claim, prompting Botas to take legal action in 2011.

The Turkish company was partially vindicated by the court decision, which issued an order for DEPA to pay 180 million euros. However, the court excluded the year 2008 from its calculations of the sum to be paid.

The Greek gas company completed this payment in September, 2016, but then opted to file a case against Botas last year in an attempt to have the payment ruling cancelled. If DEPA wins this case, then Botas would need to return part of the 180 million euros it has received from DEPA.

It is not the only pending legal case submitted by DEPA against Botas. Last July, the Greek gas utility took legal action against Botas seeking a retroactive price revision to a contract signed by the two sides for Azerbaijani gas supplied to DEPA.

This case, submitted to the ICC, is based on two requests made by DEPA to Botas for price revisions, the first in 2011 and the second in 2016.

DEPA, which has sought a price reduction since 2003 for Azerbaijani natural gas supplied by Botas, decided it had no other choice but to take legal action. A hearing for this case is still a long way off.

Additional court dispute between DEPA, Botas now awaiting verdict

DEPA, the Public Gas Corporation, is awaiting an ICC (International Court of Arbitration) ruling on a case filed last month against Botas, Turkey’s state-run crude oil and gas company, challenging price increases of Azerbaijain natural gas supplied to Greece by the Turkish firm. Two legal disputes between the firms are now pending.

DEPA’s new legal case has requested an examination of natural gas price increases made by Botas in 2011 and 2016, following its alleged disregard of international market condition changes as of 2009.

DEPA is hoping for a reduction in the price of Azerbaijani natural gas supplied by Botas, which has delivered gas to the Greek market since 2003. The Greek gas company’s decision to take its case to the ICC was seen as the only remaining option following previous efforts to resolve the pricing dispute.

A court decision concerning an older dispute between the two sides is also pending.

The latest dispute is rooted in a Botas demand imposed on DEPA for a return of a 300 million-euro sum concerning price revision differences from as far back as 2008. DEPA  refused to pay this amount, prompting Botas to take legal action in 2011.

The Turkish firm was partially vindicated as the court set the amount to be returned by DEPA at just under 200 million euros. DEPA appealed this decision in 2016.

 

 

 

 

Socar officials ‘know nothing’ about apparent DESFA interest

A recent claim by Greece’s Ambassador to Azerbaijan supporting that the country’s state-controlled energy company Socar is interested in taking part in an upcoming yet still-unannounced tender to offer a stake of DESFA, Greece’s natural gas grid operator, has been rejected by well-informed energypress sources and the Azerbaijani company itself.

The Greek ambassador in Baku, Dimitris Tsoungas, is said to have surprised officials at Socar, who apparently were informed of the energy company’s alleged interest in the forthcoming DESFA tender through an interview in which the Greek diplomat stated this claim.

DESFA was the winning bidder of a previous long-running DESFA tender offering 66 percent. That sale attempt collapsed in December.

One energypress source explained that the Greek ambassador’s claim may have come as part of an effort to generate a favorable climate ahead of energy minister Giorgos Stathakis’s visit to Baku for today’s 3rd Southern Gas Corridor Advisory Council, where the minister is expected to hold a series of talks with highly ranked European Commission officials, fellow ministers as well as financial institution officials.

Since the collapse of the initial DESFA privatization effort last December, Socar officials have contended that Azerbaijan’s bilateral ties with Greece remain unharmed.

However, the truth of the matter is that the current Greek government’s handling of the procedure, which included the implementation of revenue-limiting measures on DESFA prior to the tender’s eventual collapse, did not go down well in Baku.

Also, leading Greek officials, including Prime Minister Alexis Tsipras and President Prokopis Pavlopoulos, have turned down invitations for official visits to Baku over the past couple of years, citing various reasons.

Today’s visit to Baku by the energy minister is the first to be made by a leading Greek government official in quite a while.

 

 

Energy minister plans series of talks at Southern Gas Corridor meeting

Energy minister Giorgos Stathakis plans to engage in a series of talks with highly ranked European Commission officials, fellow ministers as well as financial institution officials at the 3rd Southern Gas Corridor Advisory Council, scheduled to take place this Thursday in Baku.

Besides talks related to the progress of Southern Gas Corridor projects, which include the TAP project to run across northern Greece, the country’s energy minister is also expected to hold discussions, including unofficial, on a wide range of issues, given the event’s long and varied list of participants.

The Southern Gas Corridor is a  Brussels initiative promoting natural gas supply from Caspian and Middle Eastern regions to Europe, the aim being to reduce Europe’s dependency on Russian gas.

Key EU energy policy figures, especially for southeastern Europe, will attend the event in the Azerbaijani capital.

Thursday’s Southern Gas Corridor Advisory Council follows two previous one-day sessions, the first in February 2015, and the second in 2016, also in February, where a joint declaration was signed by that event’s twelve participating energy ministers.

Leading Azerbaijani officials, including energy minister Natig Aliyev, counterparts from Georgia and Albania, as well as government officials from Balkan countries, will also take part in this Thursday’s Baku meeting.

In a recent interview with Azerbaijan’s Trend News Agency, Stathakis, Greece’s energy minister, acknowledged that complex geopolitical developments are troubling the government’s plans to establish Greece as a regional energy hub.

 

Azerbaijani impressions vary on Socar’s DESFA meeting with PM

Socar has described as “positive” and “sincere” a crucial meeting held in Athens Tueday between Greek Prime Minister Alexis Tsipras and the Azerbaijani energy company’s president Rovnag Abdullayev as part of the effort to find a solution for the troubled sale of DESFA, Greece’s natural gas grid operor, according to a Socar announcement released yesterday.

The sale was kept alive following Socar’s last-minute decision to extend an expiring letter of guarantee by a month, which now gives officials until October 31 to reach an agreement. The previous letter of guarantee’s deadline had been set for September 30, three days after this week’s crucial meeting.

During the meeting, which lasted one-and-a-half hours, the Greek Prime Minister described Azerbaijan as a strategic partner for Greece and Socar as a strategic investor, the Socar announcement noted.

Tsipras also said all efforts would be made to facilitate Socar’s Greek market entry, according to the company statement, which also informed of the details of the working group established to seek common ground for a solution.

Azerbaijani press reports reflected Socar’s positive comments. However, comments made by the country’s ambassador to Greece, Rahman Mustafayev, who attended the meeting, suggest that the session was anything but smooth. He also indicated that the formation of a working group was proposed by Socar, adding that it will closely with Snam, also a potential buyer of a stake in DESFA.

Socar emerged as the winning bidder of a 2013 international tender offering a 66 percent stake of DESFA. The European Commision eventually intervened, requiring the Azerbaijani company to surrender at least 17 percent stake of DESFA to a certified European operator. Snam and Socar are believed to have reached an agreement for the surrendered stake, if the deal is finalized. Most recently, Socar was angered by a revenue-limiting measure engineered and implemented by Greek energy minister Panos Skourletis. This development prompted an extended communication breakdown. The Azerbaijani company has since contended that the market value of DESFA’s 66 percent is now worth well under the 400 million euros it had originally offered.

Citing the unfavorable developments that have ensued since 2013’s tender, an AzerNews media report noted Socar will seek an agreement only if the DESFA sale price is significantly reduced. This news source also reported Snam remains interested in acquiring DESFA’s 17 percent.

The overall impressions following Tuesday’s meeting indicate that the road towards a deal will be far more challenging than what Athens, cautiously optimistic, has described. Azerbaijani officials appear determined to have the upper hand in the negotiations.

 

DESFA revision adjustments expected, Azeri ambassador tells

Azerbaijan’s ambassador to Greece Rahman Mustafayev has relayed the discontent felt by Azeri officials over the Greek government’s recent revenue-restricting revisions for DESFA, Greece’s natural gas grid operator, in an interview with Greek weekly To Vima.

Azeri firm Socar agreed to purchase a 66 percent majority stake in DESFA after emerging as the winning bidder of a tender completed in 2013. However, the deal’s finalization, now appearing highly unlikely, has been delayed by a series of moves including European Commission intervention demanding that Socar surrender 17 percent of the DESFA stake to a certified European operator and, most recently, a Greek energy ministry amendment that severely reduces DEFSA’s leeway for network usage hikes and, by extension, the operator’s revenue potential.

Mustafayev, in the Greek newspaper interview, described the ministry’s move as “unprecedented”, noting that it makes the acquisition of a stake in DESFA unfeasible. “Socar has not been treated in such a way in any other country where the company is active,” Mustafayev was quoted as saying by To Vima.

The ambassador noted that, even so, Socar remains interested in the DESFA deal, adding that he hopes the privatization can be swiftly completed. “The operator’s market value has been reduced and the risk level has increased, which is why we expect specific moves from the Greek side in order to cover the damages caused,” Mustafayev said.

Pundits firmly believe that the negotiating sides are playing for time until the end of September, when a letter of guarantee provided by Socar expires.

Socar is legally entitled to withdraw from the sale as two years have elapsed since the tender ended. The Greek government, which inherited the DESFA sale from the country’s previous administration, has admitted its preference for an alternative DESFA sale plan, based on the IPTO (power grid operator) sale now in progress.

If this latter procedure proves successful, a 51 percent stake of IPTO will be transferred from parent company PPC, the main power utility, to the Greek State, 24 percent of the operator will be acquired by a strategic investor, and the other 25 percent will be sold through the bourse.