copelouzos

PPC, Terna, Copelouzos resume talks for Crete RES partnership

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Power utility PPC has resumed talks with Terna Energy and the Copelouzos group for a consortium to develop RES projects on Crete, but work is still needed if institutional complications are to be resolved.

The plan’s viability will depend on whether the consortium – if formed – can secure a contract with power grid operator IPTO to ensure a capacity reservation in the prospective Crete-Athens grid interconnection.

Approximately three years ago, Terna Energy and the Copelouzos group decided to merge two respective wind-energy projects covering Crete’s four prefectures, which took their combined capacity total to 950 MW, in order to facilitate an EU funding effort.

PPC also entered the picture just months ago, prior to the pandemic’s outbreak, for talks on the establishment of a three-member consortium. PPC Renewables, a PPC subsidiary, possesses wind-energy capacity on Crete.

The prospective venture planned by the trio entails transmission and sale to the mainland of 1 GW generated by wind-energy facilities. Each partner would hold a 33.3 percent stake in this venture.

 

 

Energy groups pressing ahead with natural gas-fired unit plans

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The country’s major energy groups are pushing ahead with investment plans for new gas-fired power stations despite the pandemic’s unprecedented impact on the economy and electricity market.

Mytilineos, a vertically integrated group at the forefront of electricity production and supply, began constructing an 826-MW energy center at Agios Nikolaos in the Viotia area, slightly northwest of Athens, last October and is continuing to press ahead with this project.

Investment plans by other players are also maturing. GEK-TERNA is moving ahead with licensing procedures for a 660-MW unit in Komotini, northeastern Greece. The Copelouzos group is paving the way for a 660-MW facility in Alexandroupoli, also in the northeast, while Elpedison is carrying on with procedures for an 826-MW power station in Thessaloniki.

Copelouzos could partner with an investor for the group’s Alexandroupoli project, sources informed.

All the aforementioned corporate groups are positioning themselves in a new energy landscape being shaped by the dominant role of natural gas in the transition towards renewable energy and cleaner energy sources.

This trend became very apparent during the lockdown in Greece. Natural gas and the RES sector covered 60 percent of domestic electricity demand in March.

Power utility PPC is pushing ahead with its decarbonization program without any backtracking, despite the crisis. This is creating a need for new and modern gas-fired power stations.

Furthermore, Greek energy groups are continuing to eye Balkan markets for prospective electricity exports. Electricity generation in the neighboring region has not been satisfactorily upgraded in recent decades, market officials pointed out.

Vertically integrated groups are also eagerly anticipating a new permanent CAT mechanism.

DEPA Trade offers due today, at least 7 players interested

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Five Greek and two international investment groups are expected to submit bids for the DEPA Trade privatization, whose first-round deadline expires today at 5pm.

DEPA Trade was established as a new gas utility DEPA entity for the privatization, offering the Greek State’s 65 percent stake.

Bidders may also submit their expressions of interest online, via email, as a result of restrictive measures prompted by the coronavirus crisis, but will need to follow-up with official documents by April 24. The evaluation of first-round offers is not expected to begin any sooner than April 25.

The local bidders expected to submits bids, all leading energy players, are Mytilineos, GEK Terna, Motor Oil, Hellenic Petroleum (ELPE) and the Copelouzos group.

ELPE plans to submit a joint bid in partnership with Edison, possibly through Elpedison, their joint venture for Greece’s retail energy market, sources informed.

The Copelouzos group is also working on delivering a joint offer, with Czech firm KKCG.

Shell is among the foreign companies looking interested, despite its sale, two years ago, of stakes in DEPA gas supply and distribution companies.

Dutch firm Vitol is the other foreign player believed to have been drawn to the DEPA Trade sale. Vitol had reached the final stage of an ELPE sale with Algeria’s Sonatrach as a bidding partner, but the pair ended up not submitting a binding offer.

Expressions of interest in DEPA Trade may also come from Swiss-based Hungarian firm Met Energy Holding, active in natural gas wholesale trade. This firm is already present in Hungary, Croatia, Italy, Serbia, Slovakia, Spain, Turkey and Ukraine. Qatar’s Power Global is another possibility.

DEPA Trade’s portfolio includes 409,000 customers – households and businesses.

 

Big RES projects on islands to be given IPTO cable access

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Investors behind major-scale RES project plans for non-interconnected islands and island complexes, previously granted licenses incorporating the installation of cable interconnections, will now be able to develop their renewable energy facilities and reserve capacities through interconnection infrastructure developed by power grid operator IPTO.

The energy ministry intends to attach a related amendment to a draft bill concerning environmental permits.

Licenses granted to investors in the past for major-scale wind energy farms on non-interconnected islands and island complexes expected investors to install related cable infrastructure for energy distribution.

Such licenses have been granted to the Copelouzos group and Terna for projects on Crete and Iberdrola Rokas for investment plans in the North Aegean.

The new legal framework being prepared by the ministry promises to offer investors greater flexibility as development of interconnection infrastructure will no longer be set as a condition for related RES project licenses.

Instead, investors will be able to reserve capacities through cable interconnections being developed by IPTO. However, investors will need to contribute to the cost of this infrastructure in accordance with their reserved share of the overall capacity.

Alexandroupoli FSRU market test extension until March 10

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A second-round market test offering capacity reservations for the prospective Alexandroupoli FSRU has been granted a deadline extension until March 10 to give newly emerged bidders more time to prepare for binding bids.

The Copelouzos group’s Gastrade, heading this LNG venture for Greece’s northeast, is determined to maximize the participation level of bidders and  capacity reservations in order to secure the project’s sustainability.

Besides the capacity reservation total, the duration of reservations is the other crucial factor determining the project’s sustainability. Gastrade would like to see reservations lasting 10 to 15 years instead of shorter periods.

Gastrade officials are confident the market test will produce a favorable outcome and soon propel the project towards construction.

The line-up of the Gastrade-initiated consortium for the Alexandroupoli FSRU appears to have been completed as a five-member team following a decision by Romania’s state-controlled gas company Romgaz to enter with a 20 percent stake. A related contract is expected to be signed within the next few days.

If the Romgaz entry is confirmed, the consortium’s line-up will consist of the Copelouzos group (20%), GasLog (20%), Greek gas utility DEPA (20%), Bulgartransgaz (20%) and Romgaz (20%).

 

 

DESFA wants key role in country’s infrastructure projects

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Gas grid operator DESFA, controlled by Senfluga, a consortium formed by Snam, Enagas and Fluxys for their acquisition of a 66 percent stake of the operator in 2018, is determined to play a leading role in all the country’s infrastructure projects as well as Greece’s wider natural gas-related developments.

“We see our role as being that of the leader in Greece’s gas sector and the wider region. We are interested in every gas project and want to be able to claim it. We also have the know-how and strong shareholders to play such a role,” a DESFA official told energypress.

According to sources, DESFA’s emergence as a prospective buyer of DEPA Infrastructure, a new entity established by gas utility DEPA as part of its privatization procedure, prompted officials to slightly extend the sale deadline.

More specifically, Snam, the Senfluga consortium’s chief member with a 54 percent stake, requested a deadline extension for the DEPA Infrastructure as it has yet to decide on its partners for this bidding quest. Enagas and Fluxys each hold 18 percent stakes in Senfluga. The Copelouzos group’s Damco recently joined this consortium, buying a 10 percent stake.

DESFA’s influence is also believed to have persuaded officials to delay a decision on whether to classify the development of a natural gas storage facility at a depleted offshore gas field in the south Kavala region as a national or independent grid project.

Snam, Enagas and Fluxys are part of the six-member Trans Adriatic Pipeline (TAP) consortium.

DESFA, which has signed a Memorandum of Understanding for the Alexandroupoli FSRU, is now seriously considering to acquire a 20 percent stake in this venture, headed by Gastrade.

Other projects being considered by DESFA include a 175 million-euro Cretan LNG terminal that promises to resolve the island’s energy sufficiency concerns, as well as a 57.3-km gas pipeline connection linking the Thessaloniki area with North Macedonia, already included in the operator’s ten-year strategic plan.

 

Improved Gazprom deal raises DEPA in the eyes of investors

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Lower-price deals sealed or about to be sealed between gas utility DEPA and its international suppliers are among the factors the government is relying on for a successful privatization procedure of the gas utility, a procedure launched yesterday, beginning with DEPA Trade, one of DEPA’s two new entities formed for the sale.

DEPA is believed to have renegotiated a far more favorable supply deal with Russia’s Gazprom, the Greek utility’s biggest supplier.

Forty percent of DEPA’s natural gas orders from Gazprom will no longer be pegged to fluctuating international oil prices. Instead, this percentage of DEPA’s Gazprom orders will be linked to price levels of Dutch gas trading platform TTF, one of Europe’s biggest hubs. Just days ago, prices at TTF were about half those of pipeline gas. The other 60 percent of DEPA’s orders with Gazprom will remain oil indexed.

This development promises to make DEPA’s supply deals with Gazprom far more competitive. Prospective bidders already appear to be warming to the prospect.

Major Greek corporate groups such as Mytilineos, Hellenic Petroleum (ELPE) – already holding a 35 percent stake in DEPA and considering teaming up with its Elpedison partner Edison for the DEPA sale – GEK Terna and Motor Oil are believed to be gearing up for bids. The Copelouzos group’s involvement in the DEPA Trade sale is considered certain – in a partnership with Czech entrepreneur Karel Komarek, holding a key stake in Greek lottery OPAP.

Copelouzos, Terna, PPC in Crete wind energy talks

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Power utility PPC is engaged in talks with the Copelouzos and Terna Energy groups for the establishment of a joint venture to operate Cretan wind energy parks with a total capacity of approximately 1,000 MW.

The trio also intends to secure capacity in the Crete-Athens grid interconnection once this project, being developed by power grid operator IPTO, has been completed.

Details being discussed include the prospective stakes each of the three companies in the common venture. An even split of 33 percent each is one of the options being considered.

Two major Cretan wind energy projects being developed by Terna Energy and the Copelouzos group’s Elika were merged in 2017 to simplify their respective financing procedures through the European Fund for Strategic Investments (EFSI), commonly known as the Juncker Package.

These wind energy parks, promising an overall capacity of approximately 950 MW, will be developed in four prefectures.

PPC’s involvement, if an agreement with Copelouzos and Terna Energy is reached, could offer the power utility a 330-MW capacity.

Besides the current talks with Copelouzos and Terna Energy, PPC has received over ten partnership offers by Greek and foreign firms over the past few months.

The power utility recently signed three Memorandums of Understanding for strategic partnerships in the renewable energy sector, including one with Masdar Taaleri Generation (MTG) concerning a 300-MW capacity.

Alexandroupoli FSRU awaiting Bulgarian, Romanian decisions

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Gas utility DEPA’s recent decision to enter the prospective Alexandroupoli FSRU project consortium with a 20 percent stake leaves two more vacancies for the line-up’s completion and internationalized establishment.

The venture’s consortium, formed by the Copelouzos Group’s Gastrade, is now awaiting entry decisions from Bulgaria’s BulgarGasTrans as well as Romania’s Rompetrol, seriously examining the prospect of acquiring a 20 percent stake in this prospective LNG terminal project in Greece’s northeast.

Gaslog, active in LNG transportation, was the first partner to join Gastrade with a 20 percent stake in the consortium.

Gastrade is now preparing to stage a binding second-round market test for capacity reservations. RAE, the Regulatory Authority for Energy, has approved Gastrade’s procedure inviting participants to bid.

This second-round bidding phase is expected to be completed by the end of January, paving the way for a finalized investment decision by the project’s developers.

The first round’s non-binding expression of interest phase was completed at the end of last December.

A total of 24 bidders had expressed interest for 12.2 billion cubic meters, more than double the planned facility’s annual regasification capacity of 5.5 bcm.

 

 

Copelouzos, DEPA secure PPC gas supply deals for 4.5m MWh in 2020

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The Copelouzos Group and gas utility DEPA have emerged as the winning bidders of a power utility PPC tender for gas supply to the latter in 2020 totaling 4.5 million MWh. The terms include an option for supply in 2021.

Besides the Copelouzos Group and DEPA, a third participant, Mytilineos, took part in the tender.

The Copelouzos Group has successfully bid to supply 2.5 million MWh of gas to PPC, while DEPA has taken on the other 2 million MWh needed by the power utility, energypress sources informed.

PPC is one of Greece’s biggest natural gas consumers. Its needs are expected to grow further as a result of the power company’s upcoming entry into Greece’s natural gas retail market, a move carrying ambitious targets. PPC also plans to enter the wholesale gas market.

PPC failed to secure capacity slots for 2020 at the Revythoussa LNG terminal, just off Athens, through a competitive procedure from November to earlier this month.

Success here would have enabled PPC to import LNG shipments in 2020, as the power utility had done in the previous year.

PPC now intends to bid for an LNG capacity at the prospective Alexandroupoli FSRU in northeastern Greece during a binding second-round market test expected following the festive season.

Alexandroupoli FSRU 2nd-round market test ready for launch

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Gastrade, heading an effort for the development of an FSRU in Alexandroupoli, northeastern Greece, is preparing to launch a binding second-round market test.

RAE, the Regulatory Authority for Energy, has approved the procedure’s finalized texts concerning participation terms and conditions, indicative tariffs, schedules and a capacity reservation model for the LNG terminal.

The second-round market test could be completed by the end of January, it is anticipated. This would pave the way for a final investment decision by the company while a concurrent effort is made to finalize the venture’s equity make-up.

Besides the Copelouzos group, the venture’s initiator, GasLog, active in LNG transportation, is also on board with a 20 percent stake. A final decision by gas utility DEPA on its participation, also with a 20 percent stake, remains pending.

DEPA’s prospective involvement in the Alexandroupoli FSRU project, considered a certainty, has been passed on to DEPA Trade, a new entity established in preparation for DEPA’s privatization.

A final decision by Bulgarian Energy Holding (BEH) concerning its possible entry with a 20 percent stake is also pending.

An effort offering the remaining 20 percent is in progress. Candidates include Romgaz, Romania’s biggest natural gas producer and main supplier in the domestic market. The company’s shareholders recently voted to enter the Alexandroupoli FSRU project.

“We are very optimistic. We believe we will do better than what we need to in order to make the final investment decision,” Gastrade’s chief executive Costis Sifneos noted recently.

Greece’s decarbonization program, announced recently by the government, will bring about major changes to the country’s energy mix, according to Sifneos. He expects the domestic natural gas market to grow from its current size of 4.5 billion cubic meters, annually, to 7 billion cubic meters over the next 5 to 7 years.

The Greek gas market has grown by 17 percent this year alone, while, for the first time, LNG quantities exceeded pipeline gas.

DEPA Infrastructure sale to be announced mid-December

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Privatization fund TAIPED is preparing swift privatization action at gas utility DEPA to follow the government’s ratification of a restructuring plan at the company that will place for sale two new corporate entities, DEPA Trade and DEPA Infrastructure, emerging through this process.

A tender offering investors the Greek State’s 65 percent of DEPA Infrastructure – resulting from the Greek State’s equivalent stake in DEPA – will be announced no later than December 15, according to energypress sources.

Hellenic Petroleum ELPE’s 35 percent stake – resulting from the Greek State’s equivalent stake in DEPA – is expected to be included in the DEPA Infrastructure sale, sources noted. The petroleum group has indicated it is not interested in maintaining interests in DEPA Infrastructure. If this is so, then the potential buyer or buyers of DEPA Infrastructure will become full owner.

DEPA Infrastructure is the full owner of Attiki gas distributor, covering the wider Athens area, and DEDA, covering the rest of Greece. DEPA Infrastructure also holds a 51 percent stake in distributor EDA Thess (Thessaloniki and Thessaly). Italy’s ENI is the minority partner in this venture.

DEPA Infrastructure, through all its interests, has lined up a five-year investment program worth 250 million euros. Revenues at DEPA Infrastructure are regulated and worth a total of approximately 130 million euros.

Italy’s Italgas and Germany’s E.ON are believed to be among the potential bidders for DEPA Infrastructure. Belgium’s Fluxys and Spain’s Enagas, both part of a three-member consortium controlling Greek gas grid operator DESFA, may also participate in the DEPA Infrastructure sale.

The announcement of a sale procedure for DEPA Trade will follow and is expected by the end of January.

ELPE is not expected to offer its 35 percent stake to this sale, meaning bidders will most probably be bidding for the Greek State’s 65 percent.

The Mytilineos group, Motor Oil and a partnership comprised of Copelouzos and KKCG, the Czech company holding a stake in Greek lottery company OPAP, are seen as likely participants in the privatization fund’s ELPE Trade sale. International players ENI and Edison have also been mentioned by pundits.

 

China Energy in 4 Copelouzos Group wind energy projects

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Domestic investment partnerships between the Copelouzos Group and China Energy Investment for four wind energy parks – in Thrace, Trikorfo (Karystos area, Evia), Mani and Crete – have been included in a catalog of agreements signed by officials yesterday as part of a visit to Greece by China’s President Xi Jinping, heading a Chinese business delegation.

The four wind energy parks are part of a strategic partnership signed in July, 2018 by the Chinese company and the Copelouzos Group for China Energy Investment’s entry, as a shareholder, in the Greek group’s portfolio of wind energy projects, totaling 1,500 MW.

China Energy holds a 75 percent stake in the Thrace wind energy park, already operating. Development of the Copelouzos Group’s three other wind energy projects is expected to gain momentum following the signing of yesterday’s agreements.

Other projects included in the Greek-Chinese catalogue, a list of six projects – energy related and not – include an intention by State Grid Corp of China (SGCC) to build on its 24 percent stake of Greek power grid operator IPTO; a waste incineration project on Rhodes; and expansion work at Piraeus port.

China Energy was established in November, 2017 through a merger between China Guodian Corporation and the Shenhua Group, launching its operations with an equity value of just over 17 billion euros, total assets of 235.6 billion euros, 66 subsidiaries and a workforce numbering 350,000.

The company, heavily dependent on coal but taking major steps in the renewable energy domain, was ranked 101st on the Fortune Global 500 list for 2018.

Local players dividing interest for DEPA trade, network units

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The country’s major energy sector players are more or less split in their investment interest for DEPA Trade and DEPA Infrastructure, the two new entities to emerge from gas utility DEPA’s privatization plan, but the overall interest for DEPA Trade appears to be more substantial.

The Mytilineos group, Motor Oil and the Copelouzos group have already expressed interest in DEPA Trade and will probably submit bids once the  tender is staged. Hellenic Petroleum ELPE, holding a 35 percent stake in DEPA, is also expected to express interest in DEPA Trade.

The emergence of foreign bidders cannot be ruled out as Greece’s natural gas market is gaining prominence as a hub for the wider region in southeast Europe.

As for the gas utility’s networks, Italy’s Eni, maintaining interests in the trade and distribution markets of Thessaloniki and the Thessaly region, is reported to be interested in DEPA Infrastructure. GEK Terna is also believed to be seriously considering this entity’s gas distribution prospects.

Besides the level of bids, the energy ministry will also take into account the respective business plans to be submitted by investors to the DEPA Infrastructure tender, the objective being to secure further network expansion covering new regions.

Details and procedures concerning the DEPA privatization plan have been included in a draft bill to soon be delivered to Greek Parliament. In the lead-up, the plan will be presented for public consultation, possibly beginning today.

Unlike the previous government’s plan, the Greek State’s entire 65 percent stake in DEPA will be offered through the two new entities.

The DEPA Trade and DEPA Infrastructure tenders are expected to be staged concurrently.

 

 

Major Greek energy companies represented for PM’s China trip

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The country’s energy sector is well represented in a business delegation accompanying Prime Minister Kyriakos Mitsotakis’ current official visit to China.

Greek energy corporations primarily active in electricity, renewable energy and energy project construction are represented by highly ranked officials.

Power utility PPC, represented by chief executive Giorgos Stassis; and top officials from Mytilineos group, the Copelouzos group, GEK Terna and the Panagakos group have joined the Greek Prime Minister for the China trip.

A significant energy-sector agreement has already been established by the two countries. In 2017, SGCC, the State Grid Corporation of China, acquired a 24 percent stake of power grid operator IPTO, one of the biggest Chinese investments in Greece to date.

In addition, a number of Chinese companies, including China Energy and the Sumec group, have signed Memorandums of Cooperation with Greek enterprises such as the Copelouzos group and PPC.

In the renewable energy market, Chinese-controlled EDP Renoveis has been awarded capacity, through competitive procedures, to develop RES projects.

SGCC has indicated it could be interested in an upcoming Greek electricity market privatization to offer a stake in distribution network operator DEDDIE/HEDNO.

Independent energy players rushing to fill PPC lignite void

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The country’s major independent energy groups are forging ahead with well anticipated plans to cover prospective electricity generating voids that will be created by power utility PPC’s withdrawal of lignite-fired units, now expected sooner following a government plan for a swifter withdrawal of all lignite-fired power stations, monopolized by the state-controlled power utility.

Speaking at the UN Climate Action Summit in New York last week, Prime Minister Kyriakos Mitsotakis declared full decarbonization would be achieved in Greece by 2028.

The Prime Minister’s pledge for a lignite-free Greece in less than a decade has not taken domestic independent energy groups by surprise. As early as three to four years ago, they had foreseen an approaching end of the lignite era in Greece and around Europe.

So, too, had PPC’s leadership. But the corporation’s lignite monopoly, lignite dependence of local economies in lignite-rich areas, especially Greece’s west Macedonia region, as well as perpetual political interests attached to PPC over the years, have all played roles that have prevented the utility from turning to other energy sources such as natural gas and renewables.

Over the past year or so, major energy groups in Greece such as Mytilineos, GEK-TERNA, Copelouzos and Elpedison, as well as enterprises such as Elvalhalcor and Karatzis, have taken decisions to seek licenses for the development of new gas-fired power stations. The foundation stone of a Mytilineos unit in Boetia (Viotia), northwest of Athens, will be placed by the Greek Prime Minister at a ceremony scheduled for tomorrow.

A planned decarbonization process in neighboring Bulgaria, electricity needs in North Macedonia, and Greek power grid operator IPTO’s imminent upgrade of grid interconnections with Balkan neighbors, especially the aforementioned countries, are all creating further electricity export opportunities for Greek market players.

 

 

Gov’t intends to sell Greek State’s entire 65% of DEPA

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The recently elected conservative New Democracy government appears heavily inclined towards selling the Greek State’s entire 65 percent stake in gas utility DEPA through a procedure that would offer buyers majority stakes in both the utility’s trading and distribution interests.

“Nothing has yet been finalized, but the intentions indicate a sale of the entire 65 percent,” a reliable source told energypress.

Keeping a majority stake for the Greek State in the utility’s networks does not appear to be essential for the new government, as was the case with the preceding Syriza administration, unless a politically minded decision is made along the way.

A legislative amendment is expected to be completed within October before it is submitted to Greek Parliament at the end of that month.

The previous government’s plan entailed splitting DEPA into two new business entities, DEPA Trade and DEPA Infrastructure, and offering investors a 50.1 percent stake of the former followed by a minority 14 percent share of the latter.

A privatization of the Greek State’s entire DEPA stake would represent a repeat of the gas grid operator DESFA sale, in which investors bought the Greek State’s entire 66 percent stake.

Considerable investor interest, local and foreign, is expected, especially in DEPA’s gas supply division.

Speaking just days ago at the Thessaloniki International Fair, Andreas Siamisiis, chief executive of Hellenic Petroleum ELPE, holding a 35 percent stake in DEPA, noted the petroleum group would seek a majority stake of the gas utility. The Mytilineos and Copelouzos groups have also expressed interest in public remarks.

DEPA privatization revisions headed for parliament in October

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The energy ministry is preparing revisions to the previous government’s privatization plan for gas utility DEPA by the end of this month and will submit a resulting legislative amendment to Greek Parliament in October, sources have informed.

The government intends to offer investors majority stakes in DEPA’s trading and infrastructure departments, a departure from the preceding Syriza administration’s plan to offer a majority stake in the gas utility’s commercial interests followed by a minority share in infrastructure.

Energy minister Costis Hatzidakis has not ruled out structural changes to the Syriza plan, which entailed a DEPA split into two new corporate entities, DEPA Trade and DEPA Infrastructure.

It remains unclear if gas supplier EPA Attiki, covering the wider Athens area, will be merged with DEPA Trade or sold as a separate asset.

Speaking at the ongoing Thessaloniki Trade Fair, Prime Minister Kyriakos Mitsotakis noted DEPA would be included in the government’s first round of privatizations.

The DEPA sale is expected to generate major investor interest.

Also speaking at the Thessaloniki event, Andreas Siamisiis, chief executive at Hellenic Petroleum ELPE, the holder of a 35 percent stake in DEPA, declared the petroleum company would seek to establish majority stakes in the gas utility. The Mytilineos and Copelouzos corporate groups have also expressed DEPA interest in public comments.

 

Copelouzos’ DESFA 6.6% buy inspection ready by September

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RAE, the Regulatory Authority for Energy, expects to complete its inspection of the Copelouzos group’s entry into gas grid operator DESFA early in September, enabling the agreement’s completion.

Earlier this month, the Copelouzos group’s Damco agreed to buy a 10 percent stake of Senfluga, a consortium formed by Snam, Enagas and Fluxys for the acquisition of a 66 percent stake of DESFA last year. This promises to offer Damco a 6.6 percent share of DESFA.

RAE’s endorsement could be delayed beyond early September if the authority requests further details on the agreement, some sources warned.

Damco’s decision to acquire a 6.6 percent stake of DESFA, officially announced on August 5, signals the Copelouzos group’s interest for a wider association with Snam, Enagas and Fluxys in international infrastructure projects.

The Senfluga consortium was established with Snam as its main shareholder, holding a 60 percent stake, joined by Enagas and Fluxys, each with 20 percent stakes.

The Copelouzos group, in association with Gaslog, an international LNG carrier run by Panagiotis Livanos, has launched an effort for the development of an FSRU in Alexandroupoli, northeastern Greece. Greek gas utility DEPA, its Bulgarian peer Bulgartransgaz, and private investors are also expected to become involved in this project.

Highlighting the domestic natural gas market’s growing potential, DESFA is also eyeing an imminent tender for the development of an underground gas storage facility at a depleted natural gas field in the offshore South Kavala region.

 

Copelouzos acquires 10% of DESFA consortium Senfluga

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The Copelouzos group’s Damco has agreed to buy a minority 10 percent share of Senfluga, a consortium formed by Snam, Enagas and Fluxys for the acquisition of a 66 percent stake of Greek gas grid operator DESFA last year, all sides involved have confirmed in a joint statement. The agreement was reached for a price of 56 million euros, sources informed.

Until now, Snam held a 60 percent stake in Senfluga, while Enagas and Flyxys have each held 20 percent shares. This consortium bought a 66% share of DESFA for an amount of €535 million last year.

“The Damco investment is the result of long and constructive dialogue between the two sides and has been built in accordance with the same terms and conditions applied for Senfluga’s acquisition of [the 66 percent] DESFA [stake] and in compliance with the existing regulatory framework,” the statement noted.

The agreement reflects a wider collaboration established between the Copelouzos group and the three European companies for international natural gas infrastructure projects.

Just months ago, Damco submitted a joint bid with Snam, Enagas, as well as Gaslog, to a tender for construction of LNG import infrastructure in Cyprus.

New gas-fired units reshaping electricity generation sector

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Independent electricity producers, sensing opportunities, are reshaping the sector by planning the development of new gas-fired power stations to replace the power utility PPC’s outgoing lignite-fired units. The independent producers are even replacing power stations of their own, launched about 15 years ago, as part of the overall drive.

The country’s required withdrawal of old lignite-fired power stations operated by state-controlled PPC, as well as the implementation of the target model, beginning in the summer of 2020 with a link of the Greek and Italian electricity markets, followed by a Bulgarian link as a second stage, have been cited as the two main factors bringing about this change of scene in the electricity production sector.

The independent producers GEK TERNA (Heron), Mytilineos (Protergia) and Elpedison, as well as new arrivals such as the Copelouzos and Karatzis groups, have all expressed an interest to acquire licenses for the development of new power stations.

PPC, heavily reliant on lignite-based production, is gradually losing grip of its dominance in the electricity generation sector.

Pushed higher by the EU’s environmental policy, rising CO2 emission right costs, now nearing 30 euros per ton after being worth approximately 5 euros per ton a year-and-a-half ago, are a key factor in the developments.

PPC’s CO2-related costs rose to 279.5 million euros in 2018 from 141.6 million euros a year earlier.

Elpedison enters race for new gas-fueled power station

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Elpedison has submitted an application to RAE, the Regulatory Authority for Energy, for an electricity production license concerning an 826-MW combined cycle gas-fueled unit in the Thessaloniki area, next to an existing company unit.

The investment plan, estimated to be worth 400 million euros and requiring about two years to complete, is the fifth application submitted by as many companies for a gas-fueled power station.

The companies still need to make final business decisions to proceed with these investment plans. The country’s grid capacity is believed to have space for one or two new gas-fueled power stations over the next few years.

Production licenses have already been granted by RAE for some of the other four applications while the processing of the others is believed to have reached an advanced stage.

The Mytilineos group has applied for a 650-MW unit at the corporation’s energy hub at the Viotia (Boeotia) area’s Agios Nikolaos location, slightly northwest of Athens. The Copelouzos group submitted an application for a 660-MW unit Alexandroupoli, northeastern Greece; Gek-Terna is looking to develop a 660-MW gas-fueled power station in Komotini, in the north; and the Karatzis group, owner of the KEN electricity company, aims to develop a 665-MW in the country’s mid-north, in Larissa.

Investors interested in PPC lignite units, challenges remain

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With just 19 days remaining until the May 28 deadline for binding bids in the main power utility PPC’s bailout-required disinvestment of its Megalopoli and Meliti lignite power stations, prospective bidding teams appear interested but challenges remain for the sale, relaunched after an initial attempt failed to produce a result.

The candidates are believed to be preparing decent offers based on the current SPA terms, Greek electricity market conditions and EU climate change policies.

The Czech Republic’s Sev.En Energy, joined by GEK Terna; CHN Energy-Damco Energy (Copelouzos Group); Mytilineos; and Elvalhalcor are preparing worthy offers, sources have informed.

China’s CHN Energy and Sev.En Energy have emerged as the chief partners of their respective pairings, while their Greek associates have assumed negotiating roles with PPC.

Mytilineos and Elvalhalcor are both still looking to establish an association for the disinvestment and are also pushing for further sale term improvements.

The Greek participants are particularly keen to acquire the lignite units as a means of breaking PPC’s monopoly and avoiding any new sale attempt that would also bring hydropower units into the picture and end up attracting major European players with financial might.

Greek energy firms are looking to avoid the market entry of foreign competitors as this would lead to market share contractions and a loss of their leading domestic roles.

Despite the investor interest, the sale attempt remains challenging for all sides. The Megalopoli and Meliti lignite units, according to PPC’s financial results for 2018, incurred losses of more than 360 million euros. Also, CO2 emission right costs are continuing on their upward trajectory, while Brussels’ tough stance on carbon is  stiffening.

 

Copelouzos to begin development of Alexandroupoli power plant

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The Copelouzos group’s Damco Energy plans to soon start developing a combined cycle power station in northeastern Greece’s Alexandroupoli area with support from a major foreign energy company, not yet named, energypress sources have informed.

RAE, the Regulatory Authority for Energy, granted a license for the project just days ago. The Copelouzos group submitted its application in December.

The facility is planned to be linked to the prospective Alexandroupoli FSRU by a company-owned gas pipeline, meaning Damco Energy will avoid transmission costs as the gas grid operator DESFA’s network will not be needed. This should offer the power station a competitive advantage.

Though planned as separate projects, the Alexandroupoli FSRU, an LNG terminal, and the Damco Energy power plant promise to establish synergies as one unit will support the other.

The power plant’s operating costs and production capacity, planned to offer 662 MW over a 35-year period, promise to offer grid dispatch advantages, a related study conducted by the Copelouzos group has shown.

The project is seen contributing to Greece’s wider decarbonization effort and the intermediary role to be played by natural gas in electricity generation until renewable energy sources can fully take over.

The Copelouzos group plans to complete the combined cycle power station’s development in 27 months, while its commercial launch is expected early in the second quarter of 2022, following testing.

 

 

Minister promises lifeline extension for PPC’s Kardia power station

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The main power utility PPC’s Kardia power station in northern Greece’s Kozani area will continue to operate beyond May, when the facility’s EU-approved 17,500-hour lifespan expansion is due to expire, a union group leader has contended following talks with energy minister Giorgos Stathakis, mindful of upcoming elections.

The government has agreed to strict European Commission withdrawal terms for the Kardia unit.

One of the Kardia power station’s units, Kardia III, has just 13 days of operating time remaining.

In comments to local media, Moschos Moschou, the head of PPC’s Spartakos union group, representing workers employed in electricity production, has assured that a lifespan extension beyond May would be granted to Kardia as part of Greece’s effort to meet energy sufficiency and energy security requirements.

Moschou and the energy minister also discussed the lifeline extension of another PPC unit, Amynteo, given an additional 32,000 hours from the previous 17,500.

PPC has already received four different Amynteo environmental upgrade proposals from the Mytilineos, Copelouzos, Peristeris and Intrakat groups. No agreements have been reached.

Private-sector investors will need to participate in any Amynteo power station upograde, the energy minster told Moschou, according to the union leader.

 

 

 

New PPC lignite sale’s field of contenders disclosed today

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The field of contenders entering the non-binding first round of main power utility PPC’s renewed sale of lignite units, a bailout requirement, will be unveiled to the utility this afternoon by HSBC, managing the sale’s expressions of interest procedure.

It remains unknown if two undisclosed investors from Russia and the USA, as well as China’s CMEC will emerge as additional entries to the previous sale attempt’s list of contenders, as was recently announced by PPC’s chief executive Manolis Panagiotakis.

The PPC boss has also indicated that Czech firm EPH, a participant in PPC’s initial sale effort, intends to reenter.

Expressions of interest are once again expected from Seven Energy, another Czech firm, with Gek Terna as its partner for this sale, China’s CHN Energy with the Copelouzos group, as well as Mytilineos, according to sources.

All three formations had taken part in the initial sale effort and reached a consultation stage that shaped the disinvestment’s sales and purchase agreement. Offers were submitted by Seven Energy-Gek Terna and Mytilineos.

The participation of Elvalhalcor is uncertain. This firm could move to take part in a consortium at a latter stage.

On the one hand, a wider field of prospective buyers promises to intensify bidding, while, on the other, this will increase investor demands for greater incentives as a condition for binding bids.

The PPC boss contends Meliti and Megalopoli power station units included in the sale are profitable but investors see unfavorable prospects given the EU’s decarbonization policy.

Also, an unfavorable supply agreement between PPC and the operator of the Ahlada mine feeding the utility’s Meliti unit remains unresolved. PPC wants improved terms. The existing contract, not securing price and quantity stability, was seen as a drawback by participants in PPC’s initial sale.

Furthermore, CAT remuneration eligibility for sale package units remains uncertain. The European Commission has yet to deliver news on this front.

The sale’s new evaluation procedure, seen producing a lower price, is another headache for PPC. The utility’s boss insists PPC units “will not be sold to investors seeking swift profit within a year or two.”

 

 

 

ELPE, PPC among firms eyeing DEPA Trade majority stake

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The field of contenders believed to be examining a majority stake (50% plus one share) of DEPA Trade to soon be offered through a tender include Promitheas (Copelouzos, Gazprom), Motor Oil, Mytilineos and ELPE (Hellenic Petroleum), which revealed an interest in the natural gas market last week, while presenting group results.

The main power utility PPC another firm that has indicated it intends to enter the gas market to offset anticipated losses in the electricity market is another possibility. However, PPC’s financial standing and ability to access capital markets could prove to be an obstacle.

Promitheas has shown particular interest in DEPA’s international agreements, Motor Oil is looking closely at EPA Attiki, the gas utility DEPA’s supply firm covering the wider Athens area, while Mytilineos appears to be focused on the utility’s international trade and gas supply activity.

An energy ministry draft bill splitting DEPA into two new corporate entities, DEPA Trade and DEPA Infrastructure, ahead of the utility’s bailout-required privatization was ratified in Greek parliament late last week.

The tender offering a majority stake in DEPA Trade is expected to be launched in about one month. The privatization fund will not wait for the procedures concerning DEPA’s split to be completed before launching the DEPA Trade tender. Investors will be offered a minority stake in DEPA Infrastructure at a latter date.

 

PPC acts against Ahlada mine operator for better supply terms

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The main power utility PPC has taken extrajudicial action against a family-run enterprise licensed by the utility to operate the Ahlada mine supplying the nearby Meliti lignite-fired power station in northern Greece in an effort to secure improved terms for prospective buyers of the power station. It is included in the utility’s bailout-required disinvestment of lignite assets.

The existing agreement between PPC and the Rozas family enterprise,  licensed to operate the mine, does not secure price and quantity stability. Prices vary depending on the yield offered by extracted lignite. Also, PPC believes development at the mine is too reserved. It is anticipated that greater output would lower the price of lignite per ton.

Prospective buyers who took part in PPC’s recently failed first attempt at completing its lignite package sale identified the Ahlada mine’s current supply agreement for Meliti as a disincentive. A team comprising China’s CHN Energy and the Copelouzos group was particularly troubled. The supply agreement will be passed on to Meliti’s prospective owner.

Two other requests forwarded by prospective buyers – staff cuts and the adoption of a profit-and-loss sharing mechanism for the units sold – are in the process of being added to the follow-up sale effort’s new terms.

PPC is currently supplied Ahlada lignite at a price of 23 euros per ton for its Meliti mine but wants the price level reduced by five euros per ton, which would generate annual savings of approximately 12.5 million euros.

PPC fate in hands of Brussels, hydropower units addition a fear

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The main power utility PPC’s future corporate make-up, following the apparent debacle of its bailout-required disinvestment of lignite units, now lies in the hands of the European Commission, whose intentions are soon expected.

Even if the Mytilineos group does submit an improved follow-up offer today, as has been requested, for PPC’s Meliti facility in Florina, northern Greece, and the unit is sold, the country’s commitments to the European Commission will not have been fulfilled.

Two units of PPC’s Megalopoli facility failed to attract investors, meaning the sale’s objective of reducing PPC’s lignite market share by 35.6 percent cannot be attained.

The initial offer made by the Mytilineos group for Meliti is believed to be well under the price tag set by an independent evaluator for the facility.

Another offer made by Seven Energy and Terna, for Megalopoli, was apparently rejected for not meeting terms, while the sale’s third contender, a team comprised of the Copelouzos group and CHN Energy, ended up not submitting any offers.

The crucial question, as things have turned out, is whether Brussels will bring Greece’s hydropower units into the picture, as an addition to the lignite package.

The energy ministry is definitely worried about such a prospect and insists this remains a red-line issue for energy minister Giorgos Stathakis.

Greece will be under considerable pressure should Brussels and the country’s other lender institutions decide to associate the lignite unit sale’s apparent debacle with Greece’s slow progress in opening up the retail electricity market to competition.

Data provided by the energy exchange for December showed PPC’s retail market share rose to 80.29 percent from 78.63 percent in a month. According to bailout terms on the matter, PPC’s market share at the end of 2018 was supposed to have dropped to 62.24 percent before reaching 49.24 percent by the end of 2019.

 

 

Copelouzos, Karatzis groups also planning gas-fueled units

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The Copelouzos and Karatzis corporate groups are the latest energy-sector players planning to develop new natural-gas fueled power stations, following Mytilineos, already granted a production license, and Gek Terna, whose project plan had become known but was not officially announced until yesterday.

The Copelouzos group has applied to RAE, Greece’s Regulatory Authority for Energy, for a production license concerning a 660-MW combined cycle power plant in Alexandroupoli, northeastern Greece. The Karatzis group, owner of the electricity supplier KEN, has submitted an application to the authority for the development of a 665-MW combined cycle facility in the mid-north Larissa area.

The Copelouzos group submitted its application to RAE in December while the Karatzis group forwarded its bid to the authority last month, energypress sources have informed.

As has been previously reported, the Mytilineos group plans to develop a 650-MW facility in the Viotia area, northwest of Athens, while Gek Terna is preparing to set up a 660-MW gas-fueled unit in Komotini, northeastern Greece.

The similar capacities envisioned for all four project plans are not coincidental. Technical experts consider power plant capacities of approximately 660 MW as ideal for optimal efficiency.