DEPA Infrastructure joins Oil & Gas Methane Partnership

Athens, 26th of January 2024 – DEPA Infrastructure, adopting parent group Italgas’ strategic commitment to building a carbon-neutral future, has joined the Oil and Gas Methane Partnership (OGMP) 2.0.  This strategic initiative aligns DEPA Infrastructure’s ambition with its shareholder, further reinforcing its objective to minimizing methane emissions. Italgas, among the original members of OGMP 2.0 back in 2020, has consistently been awarded the “Gold Standard” Pathway status on the basis of a credible and granular implementation plan for the consecutive years 2021, 2022, and 2023.

OGMP 2.0 stands as the industry’s sole comprehensive, measurement-based, voluntary reporting framework, enhancing the accuracy and transparency of methane emissions reporting in the Oil and Gas sector. The partnership brings together over 120 leading oil and gas companies worldwide, spanning the upstream, midstream, and downstream sectors, in collaboration with government and civil society entities.

OGMP 2.0 member companies, including DEPA Infrastructure, commit to a detailed process that involves listing all emitting assets, determining their materiality, defining a methane emissions reduction target, and designing an implementation plan for improved emissions reporting. Methane emissions are reported annually at different levels (1 to 5) on the pathway to the Gold Standard, reflecting the quality of the estimate. This journey moves from generic emissions factors to robust quantification methodologies, including direct measurement on a representative sample of facilities.

In addition to providing a standardized reporting framework, OGMP 2.0 serves as a platform for knowledge exchange and collaboration among industry stakeholders. Periodical technical workshops facilitate the sharing of insights, experiences, and best practices, contributing to a deeper understanding of potential emissions sources, quantification methods, mitigation strategies, and overcoming associated challenges.

DEPA Infrastructure, as an Italgas Group company, remains deeply committed to minimizing fugitive methane emissions. Leveraging advanced leak detection solutions with its Subsidiary Distribution Network Operator DEDA, successfully utilizes a cutting-edge Cavity Ring-Down Spectroscopy technology, the Picarro Surveyor, introduced by Italgas already by 2018. This sophisticated sensing technology enhances the speed of action, sensitivity in detection, and the scope of areas under control. In 2023 more than 100% of the distribution network has already been investigated with Picarro by DEDA in Greece, reaching the  120% goal by the end of the year.

The adoption of this technological innovation, combined with Italgas’ digitization initiatives in Greece, enhances safety, optimizes emissions monitoring and overall network management and improves the quality of services provided. It also enables smart and predictive maintenance activities, prioritizing leaks based on a materiality assessment, which allows for the implantation of the most cost-efficient solutions that benefit both the consumers and the environment.

The inclusion of DEPA Infrastructure to OGMP 2.0 leveraging on the foundations set by Italgas, extends its dedication to environmental sustainability and continuous improvement in methane emissions management beyond the regulatory thresholds set in Greece. This commitment aligns with the Group’s Sustainable Value Creation Plan (SVCP), which includes a target of 42% reduction of Scope 1 and 2 emissions by 2030 and reaching net-zero carbon by 2050 also applied in the Greek Perimeter.

 

DEDA, RAAEY, entering WACC, tariff talks, with gap to cover

Gas distributor DEDA and RAAEY, the Regulatory Authority for Waste, Energy and Water, are entering negotiations to determine gas distribution network weighted average cost of capital (WACC) and tariff levels for the regulatory period covering 2023 to 2026 with some distance between them to cover, energypress sources have informed.

A ratified legislative revision that had been forwarded by the energy ministry on the WACC level of the then-DEPA Infrastructure company, now reorganized, had set a WACC level of 8.57 percent for the current year, leaving the rest of the four-year regulatory period pending until the corporate reorganization of the gas company was completed.

The process has now been completed, as officially announced by Italian buyer Italgas, through a merger of gas distributors EDA THESS and EDA Attiki, both subsidiaries of the former DEPA Infrastructure Group, and absorption by DEDA.

The Italian group recently acquired DEPA Infrastructure and its three gas distribution subsidiaries, EDA Attiki, EDA Thess and DEDA.

According to energypress sources, DEDA will soon forward to RAAEY its proposal for WACC and tariff levels concerning 2024 to 2026, thereby setting in motion negotiations between the two sides. Finalized decisions are expected by the end of the year.

Italgas will propose a WACC level of more than 9 percent, expected to prompt a reaction from RAAEY, which is determined to subdue WACC and tariff levels to limit, as much as possible, the burden on consumers, sources said.

 

DESFA launches LNG truck loading service, suppliers keen

Gas grid operator DESFA launched its LNG truck-loading service at Megara, 45 kilometers west of Athens, earlier this week, finally enabling refueling of consumption points located at a distance from the country’s gas network.

The launch, on Monday, was preceded by an extensive performance test of the LNG truck-loading infrastructure last March. Three companies, Blue Grid, DEPA Commercial, and Motor Oil Hellas, took part in the testing with LNG trucks.

Interest in the new service is already strong as gas suppliers appear keen to utilize its flexibility to expand their customer base.

Transportation of LNG via specially designed trucks promises gas supply to industrial consumers, vehicle refueling stations selling gas, areas not connected to Greece’s gas network within Greece, as well as neighboring countries.

Plans are already underway for LNG delivery to distribution networks being developed by gas distributor DEDA in western Greece – in Patras, Agrinio and Pyrgos.

The first LNG station designed to facilitate gas distribution to remote areas was installed in September, 2022 by gas distributor EDA THESS at Elassona, towards Greece’s north. It will supply the local network. The DEPA Infrastructure subsidiary plans to do likewise for gas supply covering other areas, including the Greek islands Skiathos, Skopelos, and Alonissos.

DESFA’s LNG truck-loading initiative represents the first segment of a small-scale LNG supply chain, to be complemented by a small-scale LNG jetty under development at DESFA’s Revithoussa LNG terminal.

This infrastructure will enable bunker vessels to supply LNG-powered vessels, such as cargo ships and container ships, at Piraeus port. It will also allow for ship-to-ship refueling, supporting larger vessels, such as cruise ships.

RAEEY approves development plans of 4 gas distributors

RAAEY, the Regulatory Authority for Waste, Energy and Water, has approved five-year development plans, covering 2023 to 2027, by the country’s four natural gas distribution companies. They are comprised of investments worth a total of 840 million euros for new networks covering 3,500 kilometers of low and medium-pressure infrastructure.

The authority’s approval of the plans presented by the four gas distributors paves the way for their development. The network expansions, the distributors anticipate, will result in 370,000 new customer connections by the end of 2027.

Of the 840 million-euro total, 788 million euros concerns projects planned by DEPA Infrastructure’s three subsidiaries, the gas distributors EDA Attiki, EDA Thessaloniki-Thessaly and DEDA, all now controlled by Italy’s Italgas. Furthermore, Hengas has prepared a five-year, 50 million-euro investment plan for distribution network development.

EDA Attiki, covering the wider Athens area, plans to invest 159.9 million euros to add 484 kilometers to its distribution network. The distributor is active in 52 municipalities. It possessed a low and medium-pressure network totaling 3,981 kilometers at the end of 2022.

EDA Attiki expects to reach an additional 92,400 customers by the end of 2027 as a result if this network expansion.

EDA Thessaloniki-Thessaly plans investments worth 136.6 million euros for a 400-km network expansion and a rise in customers to 375,000 from 275,172 over the five-year period for the Thessaloniki area.

As for the Thessaly region, the distributor plans investments worth 113.9 million euros for a 400-km network expansion.

DEDA, the DEPA Infrastructure subsidiary covering other parts of Greece – eastern Macedonia-Thrace, central and western Macedonia, Epirus, western Greece and the Peloponnese, plans to invest 378.2 million euros for over 1,826 kilometers in low and medium-pressure networks.

Hengas plans to invest 50.6 million euros between 2023 and 2027 for the construction of a network covering 390 kilometers in central and western Macedonia as well as the Peloponnese.

 

RAAEY reaches decisions on WACC levels for IPTO, HEDNO

Following months of deliberation, RAAEY, the Regulatory Authority for Waste, Energy and Water, has reached decisions on WACC levels for power grid operator IPTO and distribution network operator DEDDIE/HEDNO, setting the former’s at 7.51 percent, for 2023 to 2025, and the latter’s at 7.66 percent for 2023 and 2024, energypress sources have confirmed.

Based on these decisions, IPTO’s average WACC level for the four-year regulatory period, covering 2024 to 2027, works out to 7.16 percent, while the four-year regulatory period average for DEDDIE/HEDNO is 7.11 percent.

The discrepancy in WACC levels resulted from different borrowing-cost coefficients applied to a WACC formula used by RAEEY. All other factors that were taken into account, including country risk and cost of capital, were identical.

IPTO initially sought a higher WACC rate, pushing for its cause from as far back as last year, citing unfavorable changes in the economic environment, including inflation and interest rate increases.

Just recently, RAAEY set a WACC rate of 7.85 percent for gas grid operator DESFA, covering the entire four-year regulatory period (2024-2027), and an 8.57 percent WACC rate for DEPA Infrastructure, limited to 2023.

Swifter network growth at EDA Attiki, spurred by new culture

Gas distributor EDA Attiki, covering the wider Athens area, has presented a greatly improved initial set of results concerning network growth and customer service efficiency, achieved following the company’s adoption of an upgraded corporate strategy.

EDA Attiki added more kilometers to its network during the first half of 2023 than it did throughout 2022, while the company has committed to consumer network connection waiting periods of no more than 30 days once related agreements have been signed, the gas distributor’s CEO, Leonidas Bakouras, told journalists yesterday.

The chief executive attributed the company’s improved performance to a new mentality adopted at EDA Attiki, the diligent efforts of its executives and employees, as well as the company’s utilization of multiple opportunities offered by the privatization of parent company DEPA Infrastructure, now under the wings of Italian energy giant Italgas, possessing vast experience and knowhow.

As part of its customer service upgrade, EDA Attiki has established an online service through which e-contracts concerning new network connections may be signed and supporting documents can be submitted. EDA Attiki is also adding 14 new customer service points to its overall offering.

EDA Attiki amassed an impressive total of 5,061 new connections in the first half of 2023, a complete turnaround from unfavorable data recorded during the energy crisis.

EDA Attiki had achieved a record number of new connection contracts in 2021, totaling 24,000, before an energy crisis-related slowdown midway through last year.

Highlighting the return of natural gas as a preferred energy source, seven of the company’s industrial customers who had turned to alternative sources at the beginning of the year, in an effort to offset elevated gas prices, have returned to natural gas over the past couple of months, Bakouras pointed out.

EDA Attiki aims to increase its total number of natural gas connections to 200,000 by the end of this year, from 186,515 at the end of 2022.

The company’s wider Athens network, based on data recorded at the end of 2022, covers 52 municipalities, measures 3,981 kilometers – both low and high-pressure systems – and represents a 28.5 percent share of the energy market.

EDA Attiki represents 440,000 households, 7,500 commercial consumers, and 230 large-scale industrial and commercial consumers.

DEPA Attiki’s development plan covering 2023 to 2029 aims to expand the company’s gas network to a total of 58 municipalities in the wider Athens area.

 

 

 

 

 

RAAEY decides on WACC levels for DESFA, DEPA Infrastructure

RAAEY, the Regulatory Authority for Waste, Energy and Water, has decided, after lengthy consideration, on WACC levels for two gas companies, DESFA, Greece’s gas grid operator, and DEPA Infrastructure.

The WACC level set for DESFA, 7.85 percent, will apply for a four-year period covering 2024 to 2027, while DEPA Infrastructure’s rate, 8.57 percent, applies for 2023.

The discrepancy between the two WACC levels resulted from different borrowing-cost coefficients applied to a WACC formula used by RAEEY. All other factors that were taken into account, including country risk and cost of capital, were identical.

DESFA is now expected to set tariffs ahead of tenders for three grid interconnection projects.

As for DEPA Infrastructure, the company’s new owner, Italgas, Europe’s second largest gas distributor, was expecting a WACC level of between 8 and 9 percent over the next four-year regulatory period in order to carry out its Greek investment plan through DEPA Infrastructure and its three gas distribution subsidiaries, EDA Attiki, EDA Thess and DEDA.

Decisions on WACC levels for power grid operator IPTO and distribution network operator DEDDIE/HEDNO are expected by the end of July.

IPTO has requested a revised WACC level for the regulatory period covering 2022 to 2025, while DEDDIE/HEDNO is awaiting a revision for 2023 and 2024.

Italgas seeking WACC of 8-9% to carry out Greek investments

Italgas, Europe’s second largest gas distributor, is seeking a WACC level of between 8 and 9 percent over the next four-year regulatory period in order to carry out its Greek investment plan through the Italian group’s recently acquired DEPA Infrastructure and its three gas distribution subsidiaries, EDA Attiki, EDA Thess and DEDA.

Italgas has submitted three related studies to RAAEY, the Regulatory Authority for Waste, Energy and Water, as support for what the energy group believes to be the necessary WACC level for the regulatory period starting this year and running through 2026, its CEO, Paolo Gallo, noted during a London presentation last week of the company’s strategic plan for 2023 to 2029.

RAAEY will initially reach a decision, expected early in July, on Italgas’ WACC level for 2023, given priority through a legislative revision ratified just months ago.

Prioritizing the 2023 WACC level for DEPA Infrastructure will enable Italgas to reassess its investment plans for the year concerning its three gas distribution subsidiaries, EDA Attiki, EDA THESS and DEDA.

DEPA Infrastructure’s allowed revenues and tariffs for 2023 will be determined at a latter date.

 

 

Amendment to prioritize DEPA Infrastructure WACC level for ’23

The energy ministry has prepared a legislative amendment to prioritize the setting of a WACC level for gas company DEPA Infrastructure in 2023, and, at a latter date, determine its allowed revenues and tariffs for the same year.

This legislative revision, ultimately covering DEPA Infrastructure’s latest four-year regulatory period from 2023 to 2026, will initially be applied to set levels for the aforementioned three parameters in 2023, an urgent need that has arisen as a result of the volatility in energy markets, especially the gas market, due to Russia’s ongoing war in Ukraine.

Prioritizing the 2023 WACC level for DEPA Infrastructure will enable Italgas, the company’s Italian buyer, to reassess its investment plans for the year concerning its three gas distribution subsidiaries, EDA Attiki, EDA THESS and DEDA. According to sources, Italgas is inclined to limit its investment plans for these subsidiaries in 2023.

Italgas is working on reviewing its overall corporate plan for DEPA Infrastructure in the light of an apparent downward revision of gas penetration targets for the end of the decade.

DEPA Infrastructure to gain investment clarity with revision

The energy ministry is planning to allow Italgas, the Italian buyer of DEPA Infrastructure, through an acquisition completed last year, to adjust the gas infrastructure company’s investment and corporate plan in accordance with an anticipated downward revision of gas penetration targets to be set for the end of this decade.

The ministry plans to submit a related amendment to Greek Parliament, possibly as part of a multi-bill currently being discussed by a parliamentary committee ahead of its imminent tabling for ratification.

According to energypress sources, the amendment will remove an existing parameter simultaneously determining the WACC levels and allowed revenues of DEPA Infrastructure’s three gas distribution subsidiaries, EDA Attiki, EDA THESS and DEDA, for the next regulatory period, covering 2023 to 2026.

This revision would pave the way for the average cost of capital concerning the four-year period to be determined first before regulated income is also determined.

The energy ministry’s legislative initiative, the same sources noted, comes following a request made by Italgas, so that the company may examine and establish its investment plan for the new four-year regulatory period based on WACC levels to be set until 2026.

The company’s investment plan will, as a result, be tailored to generate allowed revenues and lead to the creation of new assets.

 

RAE reserved about Italgas’ network expansion plan

RAE, the Regulatory Authority for Energy, is deeply concerned about the prospect of gas distribution network expansions into new geographical territories as, at present, amid the energy crisis, it remains unclear whether an expanded network would result in a greater number of overall gas users in Greece or, on the contrary, excessively increase the cost of this fuel for existing gas users through higher charges on regulated tariffs.

Italgas, following up on its recent 733 million-euro acquisition of DEPA Infrastructure, one of Greece’s biggest energy-sector privatizations, is keen to expand the country’s gas network through three DEPA Infrastructure subsidiaries, EDA Attiki, EDA THESS and DEDA. The expansion project is included in their investment plans for 2022 to 2026.

RAE will soon need to decide on whether to approve these gas network expansion plans.

Italgas has made clear it views geographical expansion of the country’s gas network as am approach that will increase gas usage in the Greek energy market.

Italgas aims to increase the number of gas users in Greece from approximately 600,000 at present to one million by 2028.

 

Distributors bent on network expansion despite crisis

Gas distributors EDA ATTIKI, EDA THESS and DEDA, unperturbed by the energy crisis, plan to expand the country’s gas network through the development of more than 3,000 kilometers of medium and low-pressure networks over the next four years, as well as digitization upgrades, investments worth a total of 740 million euros. RAE, the Regulatory Authority for Energy, has just forwarded the operators’ gas network expansion plans for consultation.

These investment plans demonstrate the willingness of all three gas operators to push ahead with their business plans for expanded gas usage as a key part of the country’s decarbonization effort, despite the sharp rise in gas prices.

Highlighting this intention, Italgas, whose acquisition of DEPA Infrastructure, the parent company of EDA ATTIKI, EDA THESS and DEDA, was completed one month ago, has just announced a loan of 580 million euros to be primarily used to help finance the gas network expansion plans of the three gas operators.

EDA ATTIKI, EDA THESS and DEDA cover the regions of wider Athens, Thessaloniki-Thessaly and the rest of Greece, respectively.

EDA THESS plans investments worth 233 million euros for new gas networks in the Thessaloniki and Thessaly regions.

EDA Attiki’s expansion plan for Athens, 570 km of low and medium-pressure networks by 2026, worth 122.23 million euros, will aim for 85,500 new connections by the end of 2026, taking the company’s total to 260,000 links.

DEDA Athens is planning over 2,000 km of new networks in seven regions, the biggest of the three initiatives, budgeted at 396 million euros.

 

Copelouzos in talks with Italgas for Depa Infrastructure stake of 10-20%

Greece’s Copelouzos Group is interested in joining a new company founded by Italgas after acquisition of gas company DEPA Infrastructure was officially completed, the Italian buyer’s chief executive Paolo Gallo has informed media.

Italgas and Copelouzos Group are currently involved in talks concerning a stake of between 10 and 20 percent for the latter in the new DEPA Infrastructure company, a stake closer to the lower level being likeliest, Italgas’ CEO noted.

The negotiations between the two sides could last anywhere between weeks and months, while there is no definite outcome, Gallo informed.

Italgas intends to offer an overall stake of as much as 49 percent in the new DEPA Infrastructure company. No other potential partners or initiatives have been revealed.

Gallo, responding to journalist questions, said it is too early to tell if there will be any organizational changes at DEPA Infrastructure.

However, he did confirm that the current CEOs at DEPA Infrastructure’s distribution subsidiaries EDA Attiki and DEDA, two of three in total, would remain at their posts.

As for EDA THESS, DEPA Infrastructure’s other distribution subsidiary, Italgas is still in the process of completing its purchase of a 49 percent stake held in this company be Eni. Price and terms have been agreed.

Italgas will aim for further gas penetration in parts of Greece where natural gas networks already exist, the CEO noted.

 

Clarity on Larco, South Kavala UGS privatizations by end of July

The fates of two long-running privatizations, state-controlled nickel producer Larco and the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, being offered through a tender for the development and operation of a prospective underground natural gas storage facility (UGS), are expected to be cleared up by the end of July, privatization fund TAIPED’s chief executive Dimitris Politis has informed.

Also, the completion of gas company DEPA Infrastructure’s sale to Italian company Italgas is expected by September, along with new sale alternatives for the DEPA Commercial sale, whose initial procedure was officially terminated in May as a result of complications stemming from an ongoing legal battle between the company and fertilizer producer ELFE, the TAIPED official noted.

The “South Kavala” UGS tender’s final round has been held up as a result of objections raised by participants over project pricing regulations established by RAE, the Regulatory Authority for Energy. These regulations are expected to soon be published in the government gazette.

Energean and a partnership bringing together gas grid operator DESFA and construction company GEK Terna are the final-round qualifiers of the “South Kavala” UGS tender.

Larco sale participants have been set a July 29 deadline for binding bids, Politis, the TAIPED chief, informed.

As for the DEPA Infrastructure sale procedure, hurdles have been removed as a result of revisions separating certification requirements set by RAE, the Regulatory Authority for Energy, for the gas company’s distribution subsidiaries from the DEPA Infrastructure sale.

Alternative plans for the ill-fated DEPA Commercial sale, including a possible partial privatization, will be announced by September or October, the TAIPED chief informed.

DEPA Infrastructure sale hurdle overcome by ministry revision

The energy ministry has incorporated provisions into a RES licensing simplification draft bill in order to overcome obstacles that have delayed the completion of gas company DEPA Infrastructure’s sale to Italian company Italgas.

The ministry’s provisions, now paving the way towards this sale’s finalization, separate certification requirements set by RAE, the Regulatory Authority for Energy, for the gas company’s distribution subsidiaries from the DEPA Infrastructure sale procedure.

RAE recently set terms that would essentially nullify certification for DEPA Infrastructure’s three gas distributors, EDA Attiki, EDA THESS and DEDA, if the buyer proceeds with an equity capital increase within three years of the sale’s completion.

Italgas officials have been in Greece since December, when the sale and purchase agreement was signed by the sellers, the Greek State and Hellenic Petroleum (ELPE), holding a stake, and the Italian buyer.

During this period, the Italgas officials have been collecting financial and other data concerning DEPA Infrastructure’s subsidiaries.

DEPA Infrastructure sale certification obstacles cleared

Italgas, the Italian buyer of gas company DEPA Infrastructure, a deal yet to be finalized, has accepted certification terms set by RAE, Greece’s Regulatory Authority for Energy, for the gas company’s three subsidiaries, the gas distributors EDA Attiki, EDA THESS and DEDA, a development that paves the way for the finalization of the sale, worth 733 million euros.

RAE has forwarded its decision on certification conditions for publication in the government gazette after clarifying terms, accepted by Italgas, Europe’s second largest gas distributor.

Italgas officials have been in Greece since December, when the sale and purchase agreement was signed by the sellers, the Greek State and Hellenic Petroleum (ELPE), holding a stake, and the Italian buyer.

During this period, the Italgas officials have been collecting financial and other data concerning DEPA Infrastructure’s subsidiaries.

DEPA Commercial sale over, DEPA Infrastructure completion June

Privatization fund TAIPED’s attempted sale of gas company DEPA Commercial is officially over, the European Commission admitting that the procedure cannot proceed as a result of an ongoing legal battle between the company and fertilizer producer ELFE, which, Brussels noted, in a report on the Greek economy, is expected to take two to three years to be resolved.

ELFE is seeking compensation from DEPA, claiming overpriced gas supply between 2010 and 2015, while DEPA has filed a legal case seeking overdue amounts from the fertilizer producer, based in Kavala, northern Greece.

TAIPED is now examining alternative sale solutions, according to the Brussels report.

As for the yet-to-be-finalized sale of gas company DEPA Infrastructure, acquired by Italgas, Europe’s second largest gas distributor, it is expected to be finalized in mid-June, the European Commission’s report noted.

The Brussels report made no mention of recent certification issues raised by RAE, the Regulatory Authority for Energy, which has changed its stance on the certification conditions for DEPA Infrastructure’s three subsidiaries, the gas distributors EDA Attiki, EDA THESS and DEDA.

DEPA Infrastructure sale facing hurdle on final stretch

The yet-to-be-finalized sale of gas company DEPA Infrastructure, acquired by Italgas, Europe’s second largest gas distributor, has encountered a hurdle on the final stretch as a result of certification issues raised by RAE, Greece’s Regulatory Authority for Energy.

The unexpected issues faced by this privatization, promising to provide 733 million euros to TAIPED, the country’s privatization fund, are serious and threaten to derail a sale and purchase agreement signed last December by the two sellers, the Greek State and Hellenic Petroleum (ELPE), and the Italian buyer.

The sale’s procedure had progressed swiftly, leading to competition committee approval, but events over the past few days, instigated by RAE’s change of stance on the certification conditions of DEPA Infrastructure’s three subsidiaries, the gas distributors EDA Attiki, EDA THESS and DEDA, have suddenly led to confusion, bringing the sale to a standstill.

RAE has offered conditional certification for the three subsidiaries, setting terms that did not exist in the lead-up to the sale and its conditions, according to sources.

Consequently, certification offered to the subsidiaries will not be considered valid if the buyer proceeds with an equity capital increase within three years of the DEPA Infrastructure sale’s finalization. Also, the agendas of all three subsidiaries will need to remain unchanged for their certification to remain valid, according to the sources.

TAIPED officials are believed to have been angered by these initiatives, considering them to be beyond RAE’s authority. Officials at Greece’s finance and energy ministries, as well as Italgas, have also been annoyed by RAE’s decision.

TAIPED and Italgas officials are believed to be engaged in talks in search of a compromise solution.

 

DEDA: Framework ‘pending’ for biomethane, hydrogen

Procedures leading to the establishment of legal and regulatory frameworks needed for commercial utilization of biomethane and hydrogen need to be accelerated by the government and the regulatory authority, Marios Tsakas, chief executive of gas distributor DEDA, has stressed in an interview with energypress.

Greece, from a technical and technological point of view, is ready to move ahead in the biomethane and hydrogen domains, the DEDA official pointed out.

Two pilot projects carried out by the company could develop into twenty mass-production projects if the pending legal and regulatory frameworks are completed and authorities give the green light, Tsakas noted.

The DEDA chief executive expressed optimism on the prospects of natural gas, noting that wild price fluctuations amid the energy crisis do not diminish the strategic advantages offered by this fuel, which can contribute significantly to reduced energy cost.

DEDA is preparing for the Greek market entry of sector giant Italgas, which has acquired gas company DEPA Infrastructure, Tsakas noted, adding that the arrival of this new investor, possessing enormous expertise of over 100 years in the natural gas sector, will lead to further growth that will benefit DEDA.

“We are network operators and, therefore, must be able to respond efficiently and responsibly, whether we are talking about pure gas networks or a mixture of gas and hydrogen, or biomethane,” Tsakas remarked.

 

Italgas’ DEPA Infrastructure deal to be finalized late March

The sale of gas company DEPA Infrastructure, acquired by Italgas, Italy’s biggest natural gas distribution company and the third largest in Europe, is expected to be completed in the first quarter of the year, energypress sources closely monitoring the procedure have informed.

Final sale procedures will have been completed towards the end of March, enabling Italgas to make its payment, an amount of 733 million euros, the sources noted.

The competition committee needs to approve the sales and purchase agreement, signed between the buyer and two sellers, privatization fund TAIPED and Hellenic Petroleum ELPE, on December 10, 2021.

RAE, Greece’s Regulatory Authority for Energy, also needs to issue necessary certification for the acquisition, but the competition committee’s approval is a prerequisite for this stage.

The acquisition will be fully completed once Italgas also purchases purchase gas distributor EDA THESS’s 49 percent stake held by Italy’s Eni gas e Luce, wanting to sell. This follow-up purchase of the EDA THESS stake has been set as a condition for Italgas, the winning bidder.

DEPA Infrastructure, EDA THESS’s parent company, holds a 51 percent stake in the gas distributor covering the Thessaloniki and Thessaly areas, while Eni gas e Luce, holds 49 percent.

The overall sum expected to be spent by Italgas for DEPA Infrastructure and EDA THESS’s 49 percent stake is expected to reach 940 million euros.

Then, Copelouzos group subsidiary Faethon is expected to enter DEPA Infrastructure with a stake seen ranging between 10 and 20 percent

Italgas and the Copelouzos group had reached a related agreement on this minority-stake arrangement prior to the DEPA Infrastructure tender.

Copelouzos group enters DEPA Infrastucture alongside Italgas

The Copelouzos Group is set to acquire a minor stake in Italgas’ 100 percent acquisition of DEPA Infrastructure, to be completed tomorrow when Italgas is expected to sign a final agreement with Greek privatization fund TAIPED.

The Copelouzos Group is expected to acquire a stake of between 10 and 20 percent in DEPA Infrastructure through Faethon, a group company controlled by family member Elmina Copelouzou.

The Copelouzos Group and Italgas had reached an agreement on this partnership while the DEPA Infrastructure tender was still in progress.

The total value of the DEPA Infrastructure acquisition by Italgas is worth 940 million euros, making it one of the biggest deals reached in Greece in recent years.

The 100 percent privatization of DEPA Infrastructure comprises 100 percent of gas distributor EDA Attiki, covering the wider Athens area; 100 percent of gas distributor DEDA, representing all other areas in Greece except for Thessaloniki and Thessaly; as well as a 51 percent stake in gas distributor EDA THESS, covering the Thessaloniki and Thessaly areas.

As its next step, Italgas will also buy the remaining 49 percent of EDA THESS following a decision by Eni Gas e Luce to sell this stake.

DEPA Infrastructure sale to Italgas nearing completion

The sale procedure for DEPA Infrastructure, acquired by Italgas, Italy’s biggest natural gas distribution company and the third largest in Europe, is now nearing completion, with its sales and purchase agreement expected to be signed within the next few days.

The agreement was forwarded to the inspection committee on October 26 and approved a fortnight later. Once the SPA is signed all financial aspects of the agreement are expected to be completed by early 2022 as Italgas will need to be certified by RAE, Greece’s Regulatory Authority for Energy, and receive necessary approvals from the competition committee.

Italgas emerged as the winning bidder in a tender offering 100 percent of DEPA Infrastructure with an offer that exceeded the most optimistic of expectations to reach 733 million euros.

The 100 percent privatization of DEPA Infrastructure comprises 100 percent of gas distributor EDA Attiki, covering the wider Athens area; 100 percent of gas distributor DEDA, representing all other areas in Greece except for Thessaloniki and Thessaly; as well as a 51 percent stake in gas distributor EDA THESS, covering the Thessaloniki and Thessaly areas.

Italgas has announced, as part of its strategic plan for 2021 to 2027, an investment plan totaling 7.5 billion euros, the aim being to reinforce the natural gas distribution network’s strategic role in the decarbonization procedure.

Italgas, whose roots stretch back 180 years, operates 70,000 kilometers of distribution networks in Italy, servicing over 1,800 municipalities.

Regulatory framework, potential key to Italgas’ DEPA Infr. move

The existing regulatory framework and country’s gas penetration prospects were key attractions in Italgas’ decision to develop an interest in DEPA Infrastructure, according to the Italian company, the preferred bidder in a privatization offering a 100 percent stake.

Given the Greek government’s approval, the agreement is expected to be completed by the end of the year, the Italian company’s administration has just informed. Bidding procedures were completed last week.

Italgas began considering its DEPA move back in the spring of 2018 and views its acquisition as a significant step signaling the company’s return to the Greek market following a presence some years ago through gas distributor EDA THESS, covering the Thessaloniki and Thessaly areas, chief executive Paolo Gallo noted.

“Greece is similar to Sardinia. Investments are needed. We can also develop our knowhow here for new, fully digital networks that will lead Greece through the energy transition,” Gallo commented.

The DEPA Infrastructure deal perfectly matches Italgas’ long-term strategic vision, while the Italian company, through this investment, can maintain a strong presence in Greece for decades, possibly right up until 2043, Gallo projected.

Italgas plans to increase DEPA Infrastructure’s network supply points from 509 last year to 870 by 2026 and over 1,050 by 2030. It also aims to extend the network’s total length from 6,875 km to 10,800 km in 2026 and 11,500 km in 2030.

Italgas expects DEPA Infrastructure’s revenue to increase from 129 million euros last year to 210 million euros in 2026 and 240 million euros in 2030, while operating profit is expected to rise from 81 million euros to 160 million euros in 2026 and 185 million euros in 2030.

Energy privatizations exceed forecasts, raising nearly €3bn

Two major energy-sector privatizations whose bidding procedures were completed last week, the 100 percent sale of gas company DEPA Infrastructure and 49 percent sale of electricity distribution network operator DEDDIE/HEDNO, exceeded even the most optimistic of expectations, resulting in total revenue, from both sales, of 2.849 billion euros, well over initial projections of 2.2 billion euros.

Australian fund Macquarie’s 2.116 billion-euro winning offer for 49 percent of DEDDIE/HEDNO, being offered without managerial control, stands as a record sum for Greek privatizations.

The DEDDIE/HEDNO sale’s amount will be used by power utility PPC, the parent company, for network modernization, RES growth, and improved customer services.

Italy’s Italgas secured 100 percent of DEPA Infrastructure with an improved follow-up offer of 733 million euros. Thus sum is expected to exceed 800 million euros once the buyer’s bid for a 49 percent stake in distributor EDA THESS, covering the Thessaloniki and Thessaly areas, is submitted and added to the tally.

According to the DEPA Infrastructure sale’s terms, the winning bidder must also purchase EDA THESS’s 49 percent stake, held by Italy’s Eni gas e Luce, wanting to sell.

The favorable outcomes of the two privatizations highlight the country’s improving investment climate as well as the confidence of foreign institutional and strategic investors in the prospects of the Greek economy, Prime Minister Kyriakos Mitsotakis noted. This improvement is also confirmed by yet another upgrade of the Greek economy, this time by Scope Rating, he added.

Besides signaling good news for the Greek economy, the DEDDIE/HEDNO and DEPA Infrastructure privatizations also send an upbeat message on the prospects of the domestic energy market.

 

Big week for energy privatizations, approaching finales

It is a big week for the country’s energy privatizations with gas company DEPA Infrastructure’s tender set to reach a concluding stage tomorrow and that of distribution network operator DEDDIE/HEDNO also approaching its finale as its binding bids are scheduled to be opened on Friday.

Italgas, Italy’s biggest natural gas distribution company and the third largest in Europe, has, according to sources, submitted the highest bid in the DEPA Infrastructure sale, offering an 100 percent stake, and is the only bidder to which the privatization fund TAIPED has extended a request for an improved offer, by tomorrow.

The Italgas offer is believed to be close to 700 million euros, a figure expected to rise further, and well above an offer submitted by rival bidder EPH from the Czech Republic.

As for the privatization of DEDDIE/HEDNO, a power utility PPC subsidiary, four binding offers, for a 49% stake, have been submitted by major international funds CVC Capital Partners Group, First Sentier Investors Group, KKR Group, and the Macquarie Group. This level of participation could boost bid levels. Offers of over 1.5 billion euros, or even 1.7 billion euros, could be unveiled, sources have anticipated.

The rebounding economy, potential of Greece’s energy market, as well as the statures of all five suitors involved in the two sales could result in two of the country’s most lucrative privatization agreements, in all sectors.

Italgas, DEPA Infrastructure’s top bidder, step from acquisition

Italgas, Italy’s biggest natural gas distribution company and the third largest in Europe, is now one step away from acquiring Greece’s DEPA Infrastructure as, according to energypresss sources, it has submitted the highest bid in the DEPA Infrastructure sale and is the only bidder to which the privatization fund TAIPED has extended a request for an improved offer, by September 8.

The Italgas offer is believed to be close to 700 million euros, a figure expected to rise further, and well above an offer submitted by rival bidder EPH from the Czech Republic.

The preferred bidder may be officially announced on September 9. The sale procedure is expected to be finalized by the end of the year as national and European authorities will need to re-certify DEPA Infrastructure as a natural gas network operator under its new ownership to emerge from the sale.

The 100 percent privatization of DEPA Infrastructure comprises 100 percent of gas distributor EDA Attiki, covering the wider Athens area; 100 percent of gas distributor DEDA, representing all other areas in Greece except for Thessaloniki and Thessaly; as well as a 51 percent stake in gas distributor EDA THESS, covering the Thessaloniki and Thessaly areas.

The preferred bidder will also submit an offer for the remaining 49 percent stake in EDA THESS, based on an agreement reached between TAIPED, the privatization fund, with Italy’s Eni Gas e Luce, the current holder of this minority stake.

As a result, DEPA Infrastructure’s winning bidder stands to become the sole stakeholder in the three gas distribution companies.

DEPA Infrastructure bidder legal files opened ahead of offers

Privatization fund TAIPED has opened first-stage files carrying legal documents submitted by two bidders, Italy’s gas network operator Italgas and the Czech Republic’s EP INVESTMENT ADVISORS, for the 100 percent sale of gas company DEPA Infrastructure.

This is the first step before the financial offers submitted by the two bidders are opened.

TAIPED officials are now examining the legal documents in case any clarification is needed before the sale’s procedure advances to the second and final stage, when the financial offers are opened, probably towards the end of August or early September.

The possibility of the bidders being asked to improve their offers has not been ruled out.

 

Italgas, Czech Republic’s EPH bid for DEPA Infrastructure

Italy’s gas network operator Italgas and the Czech Republic’s EP INVESTMENT ADVISORS (EPH) met yesterday’s deadline to submit binding bids for the 100 percent sale of gas company DEPA Infrastructure, bringing this privatization to its final stretch.

TAIPED, Greece’s privatization fund, will now need to check if the files submitted by the suitors are complete before opening up their respective financial offers.

The privatization fund’s board will inspect the first-stage files, carrying legal documents, at its next meeting, sources informed. If the files are complete, TAIPED will proceed to the next step of opening up the financial offers, but not before some time has elapsed to allow for possible objections.

If the price difference in the financial offers is no more than 15 percent, TAIPED will request improved follow-up bids from both bidders.

The preferred bidder is expected to be announced by the end of August or early September. DG Comp and DG Energy approval will then be required before an agreement can be signed for the transfer, to the winning bidder, of TAIPED’s 65 percent stake control of DEPA Infrastructure and the 35 percent stake held by Hellenic Petroleum (ELPE).

The sale of DEPA Infrastructure, controlling the distribution networks of EDA Attiki, covering the wider Athens area, EDA Thess, covering Thessaloniki and Thessaly, as well as DEDA, covering the rest of Greece, will spell the end of the Greek State’s control of the country’s low and medium-pressure natural gas pipelines.

DEPA Infrastructure sale now a showdown for two, Italgas, EPH

With the deadline for binding bids in the 100 percent sale of gas company DEPA Infrastructure expiring tomorrow, a latest update from sources indicates that two suitors will submit offers, Italy’s gas network operator Italgas and the Czech Republic’s EP INVESTMENT ADVISORS (EPH). An additional bid by a third participant has not been ruled out.

Besides Italgas and EPH, four other bidders have qualified for the privatization’s final round, these being two Australian funds, FIRST STATE INVESTMENTS (European Diversified Infrastructure Fund II) and MACQUARIE (MEIF 6 DI HOLDINGS), international fund KKR and Chinese consortium SINO-CEE FUND & SHANGHAI DAZHONG PUBLIC UTILITIES (GROUP) Co., Ltd.

The Greek State is selling its 65 percent stake in DEPA Infrastructure, through the privatization fund TAIPED, and Hellenic Petroleum (ELPE) the other 35 percent.

Italgas’ chief executive Paolo Gallo, in an interview with Greek daily Ta Nea, has stated the company will be submitting a binding offer for the DEPA Infrastructure sale.

Italgas is Italy’s biggest natural gas distributor, holding a 34 percent market share, and also ranks as Europe’s third biggest network operator. Italgas operates 70,000 kilometers of networks serving over 1,800 municipalities.

Rival bidder EPH is a formidable energy group with vertically integrated investments in central Europe. It owns and utilizes assets in the Czech Republic, Slovakia, Germany, Italy, the UK, France, Hungary and Poland, covering a range of domains such as energy and heat production, natural gas transmission and storage, as well as distribution and supply of natural gas, heating and electricity.

DEPA Infrastructure controls gas distributors EDA Attiki and EDA THESS, both with 51 percent stakes, as well as DEDA.