DESFA development of west Macedonia pipeline set to start

Gas grid operator DESFA is set to begin its development of a gas pipeline in northern Greece’s west Macedonia region next month, an official ceremony for the start of work slated for end of February or early March, energypress sources have informed.

According to the operator’s ten-year development plan covering 2022 to 2031, the gas pipeline, a project budgeted at 147 million euros, is scheduled to be completed in autumn, 2026.

The gas pipeline project’s financing will be covered by DESFA capital as well as a syndicated 505 million-euro bond loan agreement reached by the operator with the country’s four main banks for its ten-year development plan from 2021 to 2030.

The pipeline will cover a total distance of 147 kilometers, running from Trikala in the Imathia region to Ptolemaida. It will branch off at four points for distribution to the region’s urban centers, namely Edessa, Skydra, Naoussa, Veria, Florina Amynteo, Ptolemaida and Kozani, and will be equipped for a prospective extension to the Kastoria area.

This pipeline, it is worth noting, will be totally compatible to carry and transport hydrogen, making it Greece’s first and one of Europe’s few pipelines fully supporting transportation of renewable gases.

It will make up part of the European Hydrogen Backbone (EHB), a plan shaped by European operators and companies for the development of a European pipeline network hosting hydrogen. Their objective is to have developed a network covering a total distance of 40,000 kilometers by 2040.

 

RAE prepares list of crucial industries for gas rationing exemption

RAE, the Regulatory Authority for Energy, has prioritized industrial enterprises for a ranking system exempting the most crucial players from natural gas rationing in 2023, should such an emergency measure be necessary.

This list of prioritized industries is needed so that a revised emergency plan for 2023, prepared by gas grid operator DESFA and approved by RAE, can be implemented, if needed.

The European Commission requires all EU member states to deliver lists prioritizing industries for the year as part of an EU’s emergency plan designed to weather extreme energy market conditions.

In Greece, a total of 104 industries have been divided and prioritized in eight groups. Industries belonging to the highest-ranked group would be the first to be subject to rationing, while industries in the lowest-ranked group are least likely to be subject to gas rationing.

Industries in the highest-ranked group could convert to alternative fuels and second-tier industries could reduce gas consumption without any major impact on their operations.

West Macedonia gas pipeline development starting February

Preparations leading to the construction of a new gas pipeline in northern Greece’s west Macedonia region, including licensing for land to host the project, are on the final stretch, and should enable the project’s development to commence by February, 2023.

According to gas grid operator DESFA’s ten-year development plan, the gas pipeline, which will connect the west Macedonia region with the country’s gas network, also represents part of the decarbonization strategy for the lignite-dependent region, as well as its fair transition into the post-lignite era.

The new pipeline is scheduled to begin operating in August, 2023 before being integrated into the grid a month later.

The project, budgeted at 147 million euros, is planned to be co-financed by DESFA capital as well as a portion of a 505-million bond loan agreement reached by the operator with the country’s four main banks, National Bank, Eurobank, Alpha Bank and Piraeus Bank, to finance its ten-year development program.

The pipeline is planned to cover a total distance of 156 kilometers, running from a point roughly two kilometers east of Trikala to an area north of Ptolemaida, close to Komnina in the Kozani region.

 

 

Four LNG shipments planned for Revythoussa terminal in January

Four LNG shipments totaling 443,130 cubic meters are scheduled to be delivered to gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens, in January, a quantity that is roughly half the amount planned for this month.

More specifically, for January, the Mytilineos group has ordered an LNG shipment of 147,710 cubic meters, gas utility DEPA has placed an order for 73,855 cubic meters, Elpedison has ordered 147,710 cubic meters and Swiss company KOLMAR has ordered an LNG shipment of 73,855 cubic meters.

 

 

Soaring gas prices in Europe, up 60% in 3 weeks, ‘unjustified’

Wholesale gas prices have surged by 60 percent over the past few weeks – widely regarded as unjustified – under the pretext of falling temperatures and increased demand, despite no supply issues as gas storage facilities around Europe are virtually full.

January derivatives on the Dutch exchange (TTF) exceeded 160 euros per MWh yesterday, reaching as high as 165 euros per MWh, the highest level since October 13, following levels as low as 105 euros per MWh during the first ten days of November.

This surge, supposedly resulting from an increase in demand, strongly suggests speculators and traders are having a field day as gas storage facilities around Europe are about 95 percent full and offer supply security.

Meanwhile, the EU’s 27 member states remain divided over the details of a possible gas price cap and are continuing their negotiations without an agreement in sight.

“In essence, the energy market is once again hostage to speculation. The volume of virtual trading in January derivatives is bought and resold ten, twenty times, or even more, creating unjustified revaluations,” Dimitris Kardomateas, former Director General of Strategy & Development at gas grid operator DESFA, told energypress. “Prices at the US Henry Hub are 22-23 euros per MWh, while, in Europe, they are now at 140-150 euros per MWh,” he added.

 

New extension for South Kavala UGS tender most likely, investors hesitant

The government appears to have reached a decision to order yet another deadline extension for the submission of binding bids in a tender staged by privatization fund TAIPED for the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, being offered for the development and operation of a prospective underground natural gas storage facility (UGS) for a 50-year period.

The current deadline expires today, but, according to sources, authorities fear the tender’s final-round qualifiers will not submit bids as they have complained pricing regulations established by RAE, the Regulatory Authority for Energy, do not make the investment viable.

Energean and a partnership bringing together gas grid operator DESFA and construction company GEK Terna have qualified for the tender’s final-round.

 

 

Revythoussa LNG gasification demand doubles capacity

Gasification demand for prospective LNG shipments to be delivered to the LNG terminal on the islet Revythoussa, just off Athens, by importers who have secured slots at the facility, has doubled the facility’s gasification capacity during the second stage of gas grid DESFA’s ongoing annual auction for 2023.

Gas companies secured Revythoussa slots for their LNG imports at the auction’s first stage last week and are now bidding for gasification places in the procedure’s second stage, which started yesterday and will be be completed tomorrow.

Gasification capacity available at the Revythoussa LNG terminal is approximately 15 million cubic meters per day, but gasification bids, it has become known, are currently two times over this capacity.

High gasification demand had been anticipated given the enormous potential for natural gas exports to the Balkans, as was highlighted be the high bids for Revythoussa LNG slots placed by importers at last week’s auction. Slot prices reached as high as 4 million euros, three-and-a-half times over price levels recorded a year earlier.

South Kavala UGS tender likely to conclude without result

A deadline for the submission of binding bids in a tender staged by privatization fund TAIPED for the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, being offered for the development and operation of a prospective underground natural gas storage facility (UGS) for a 50-year period, has been finalized for November 28, approximately two-and-a-half years after the tender was announced, energypress sources have informed.

However, the tender’s two final-round qualifiers – Energean and a partnership bringing together gas grid operator DESFA and construction company GEK Terna – have complained related pricing regulations are far from making the investment viable. Subsequently, the participants will most likely not submit binding bids, sources closely following the procedure have noted.

If so, the tender will most likely be declared inconclusive, setting back the country’s plan for a domestic UGS. Its gas storage capacity would offer crucial protection for Greece against international market price volatility.

Officials representing the energy ministry, TAIPED and RAE, the Regulatory Authority for Energy, held a meeting last week on the South Kavala UGS, where a decision was reached to complete the ongoing tender as soon as possible, with the current pricing regulation intact.

The tender for the South Kavala UGS was launched by TAIPED in June, 2020.

Revythoussa LNG slot prices soar, driven by Balkan exports

Driven by LNG export potential to Bulgaria and the wider eastern European region, energy companies have submitted bids of between 3.5 and 4 million euros for slots at gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens.

These bids, made at an ongoing DESFA auction offering slots for the next four years, are roughly three-and-a-half times higher than price levels recorded last year.

Two Bulgarian companies, Bulgargaz and Kolmar, as well as Greece’s power utility PPC and Motor Oil, were the winning bidders at the auction’s session yesterday, securing four of eight Revythoussa slots offered. The other four slots are expected to be taken by bidders today.

Earlier in the week, on Monday, gas company DEPA secured eight slots for 4 TWh, Mytilineos secured five slots for 5 TWh, as did and Bulgaria’s MET.

Greece’s recent transformation as a strategic gas exporter for the wider region has prompted a surge in demand for slots at the Revythoussa LNG terminal.

During the year’s first nine-month period, the country’s gas exports increased by 293 percent, representing over 20 TWh. Bulgaria was the main recipient. Greece has been covering the neighboring country’s gas needs for some months now, following natural gas pipeline disruptions from Russia.

 

DESFA market test for gas grid lift includes 3 pipeline doubles

Gas grid operator DESFA has begun preparing a market test for prospective gas transmission system expansion projects, based on a requirement set by RAE, the Regulatory Authority for Energy, as part of its approval of the projects.

The market test’s details are expected to be completed by the end of this month. A related event will then be staged to update gas transmission system users on the market test’s process as well as projects to be offered for capacity reservations.

RAE’s market test requirement for these projects has been incorporated into its approval of DESFA’s ten-year development plan covering 2022 to 2031, as the authority wants the operator to gauge the level of interest and need concerning the gas transmission system’s expansion.

According to energypress sources, three new gas pipelines, to serve as doubles at sections of the existing infrastructure, will be included in the market test.

One of the three pipelines is planned to complement infrastructure covering parts of the wider Athens area, a second pipeline is envisaged as a double for a pipeline running from Athens to Thessaloniki, and a third pipeline is planned to run as a double alongside a line from Thessaloniki to Komotini, northeastern Greece.

The EU’s decision to gradually diminish its reliance on Russian gas is changing the continent’s gas supply map. Subsequently, gas entry points from the continent’s south are now becoming more crucial, giving rise to the need for gas infrastructure boosts in Greece.

 

Bypass solution for Alexandroupoli FSRU gas to IGB pipeline

Gastrade, a consortium established by the Copelouzos group for the development and operation of northeastern Greece’s Alexandroupoli FSRU, and gas grid operator DESFA, have reached a verbal agreement for a technical solution that will temporarily skip the need for a compressor station in order to transmit gas from the FSRU to the Greek-Bulgarian IGB pipeline for export.

The Alexandroupoli FSRU is planned to be completed by December, 2023, well ahead of the scheduled completion, by DESFA, of the IGB gas pipeline’s compressor station in Komotini, expected in October, 2024.

Normally, the Komotini compressor station would be needed to transmit natural gas from the FSRU to the IGB pipeline, whose commercial launch is scheduled for tomorrow.

The verbal agreement between Gastrade and DESFA, mediated by RAE, the Regulatory Authority for Energy, is soon expected to be made official.

The resulting contract will include a timeline for the development, by DESFA, of necessary accompanying projects concerning the country’s gas grid. They need to be completed if the technical solution agreed to by Gastrade and DESFA is to be brought to fruition.

 

 

Operators tasked with LNG refueling of autonomous gas networks

LNG refueling at autonomous gas networks will be assigned to companies developing this infrastructure, RAE, the Regulatory Authority for Energy, has decided.

RAE took its decision after Italgas, buyer of gas company DEPA Infrastructure, responded favorably to a proposal by the authority for DEPA Infrastructure’s distribution subsidiaries to take on the refueling task at autonomous gas networks.

Gas grid operator DESFA was also interested in taking on these services. Grid operators are most appropriate for network refueling services as they have a clear picture of consumption levels at any given moment, and, by extension, LNG refueling needs.

Hesitation by some operators prompted RAE to turn to Italgas. The Italian company is already accustomed to autonomous gas network refueling as a result of an equivalent model it applies for Sicily, where local networks are refueled with LNG.

 

 

 

Revythoussa new FSU ready to receive LNG, slots in October

A newly installed floating storage unit at the Revythoussa LNG terminal on the islet just off Athens, which has boosted the facility’s capacity by 70 percent, is now ready to receive additional LNG shipments.

The LNG terminal’s capacity boost comes ahead of an October auction, to be held by gas grid operator DESFA, for slots at the facility.

All technically related preparations concerning the new FSU have been completed. The capacity boost enables two LNG tankers to unload at the same time, meaning scheduled tanker arrivals can  be facilitated along with short-notice import orders placed by suppliers or traders.

Such a need does not seem necessary at present, market sources have informed, but the usefulness of the terminal’s capacity boost will start becoming apparent once autumn sets in.

Suppliers and traders will be able to plan their LNG imports for 2023 in accordance with the terminal’s increased capacity as DESFA will auction off slots in October.

The FSU, leased by DESFA in June for a 12-month period through a tender, boosts the terminal’s capacity by 70 percent, from 225,000 cubic meters to 380,000 cubic meters.

 

 

Market test ahead of gas system boost decisions

Authorities at gas grid operator DESFA and RAE, the Regulatory Authority for Energy, are set to begin a new round of talks to decide if the country’s gas infrastructure requires expansion.

DESFA will need to submit a proposal no later than September 30 regarding any amendments that may be required to its management code in order to conduct a market test exploring the interest and necessity of a gas system expansion.

DESFA’s ten-year development plan covering 2022 to 2031, which includes a proposal for the gas system’s expansion, budgeted at 422 million euros, still needs to be approved.

FSU at Revythoussa LNG unit, Italy storage solution advances

An FSU has been licensed and installed at gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens, boosting the facility’s overall capacity to 370,000 cubic meters.

The new floating storage unit’s installation at the Revythoussa terminal comes as part of the country’s energy security effort for protection should Russia disrupt its gas supply. In addition, it will also be used to serve the needs of neighboring countries.

Other steps are also being taken as part of the national energy security plan.

Greek and Italian officials have reached an advanced stage in talks for maintenance of Greek gas reserves at 1.14 TWh at an underground storage facility in the neighboring country. According to sources, the two sides are set to sign a related Memorandum of Cooperation.

The European Commission requires all EU member states without – or without sufficient – natural gas storage facilities, such as Greece, to store by November 1, gas quantities representing 15 percent of annual consumption at existing storage facilities maintained by fellow member states.

Electricity producers operating generators with dual combustion units (natural gas and diesel) are soon expected to take part in an energy ministry meeting to examine fuel-storage issues. This session could take place tomorrow.

 

 

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.

TAIPED, Kavala UGS bidders call for greater user funding

Greece’s privatization fund TAIPED and the final-round bidders in a tender offering the development and operation of a prospective underground natural gas storage facility (UGS) at the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north have called for an increase of the project’s funding by energy network users to a degree of as much as 100 percent, from a level of 50 percent proposed by RAE, the Regulatory Authority for Energy.

This call for the project’s greater funding percentage by energy network users was expressed by TAIPED and the sale’s two candidates – Energean and a partnership bringing together gas grid operator DESFA and construction company GEK Terna – during consultation staged by RAE.

The project’s increased funding percentage by energy network users would ensure its sustainability, while, on the contrary, the risk level would be high, the tender’s final-round qualifiers noted.

RAE’s consultation covered the UGS project’s pricing framework and DESFA’s ten-year development plan from 2022 to 2031.

 

Greece envisioned as gas supply solution in Europe, Balkans

Greece is seen as a natural gas supply solution by Balkan and European countries, a Regional Task Force meeting in Sofia, staged within the framework of the EU Energy Platform –  formed to help establish common natural gas and hydrogen markets – has made apparent.

The Sofia meetings agenda focused on the search of natural gas supply solutions given an anticipated demand increase in Europe, including the continent’s southeast, Mihalis Thomadakis, Director of Strategy and Management at gas grid operator DESFA, who participated in the Sofia meeting, has told an ensuing industry event, Athens Energy Dialogues.

He was a member of the Greek delegation in Sofia led by Nektaria Karakatsani, an energy ministry expert on energy policy matters.

Delegations representing Ukraine, Bulgaria, Romania, Croatia and Moldova also took part at the Regional Task Force meeting in Sofia.

Thomadakis, the DESFA official, underlined that gas network upgrades need to be developed as quickly as possible in order to meet new needs emerging.

Besides the EU Energy Platform, established in April as part of Europe’s plan for a swift end to its reliance on Russian natural gas, the European Commission, in collaboration with the International Energy Agency, has also formed the Technical Support Instrument, a project already involving seventeen EU member states, for the same purpose.

The TSI project is promoting energy source diversification and transmission, biomethane production, international hydrogen trade, roof-mounted solar energy installations, energy efficiency measures, swifter RES licensing procedures, innovative hydrogen solutions, as well as RES projects for the industrial sector.

 

Kavala UGS binding offers in July, pricing rules unchanged

RAE, the Regulatory Authority for Energy, has left unchanged, following consultation, a pricing framework for a prospective underground natural gas storage facility (UGS) at the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, a step enabling the project’s binding-bids stage to go ahead, energypress sources have informed.

According to the tender’s latest schedule, included in a European Commission report published yesterday, binding bids will be submitted towards the end of July, while, in the lead-up, the two bidding teams, a consortium comprising gas grid operator DESFA and GEK TERNA, and rival bidder Energean, will be updated on the license’s details.

The tender is expected to be completed towards the end of October.

According to the project’s pricing framework, 50 percent of the UGS facility’s development cost, budgeted at 314 million euros, will be guaranteed through regulated earnings.

The project’s operator will need to retrieve the remainder either from the Greek State, on the grounds of strategic reserve maintenance, or from other users of the facility.

 

Northern pipeline’s environmental permit paves way for development

The energy ministry has approved environmental terms for gas grid operator DESFA’s natural gas pipeline project covering northern Greece’s west Macedonia region, a decision that paves the way for work to commence in autumn.

The project, budgeted at 110 million euros, promises to extend the national gas grid’s coverage, contribute to the country’s decarbonization plan and support the transition of the west Macedonian region, until now a lignite-dependent local economy.

The pipeline is planned to run from a location two kilometers east of Trikala to a point north of the provincial town Ptolemaida in the Kozani region, a 93.56-km distance.

The project, already fully certified to transport hydrogen, will offer a capacity of 388,000 Nm3/h.

The pipeline’s completion is scheduled for the first half of 2023.

 

 

 

Biomethane a priority for DESFA, pilot project in the making

Gas grid operator DESFA, placing biomethane interests among its priorities, intends to forward a related proposal to the energy ministry by the end of June as part of ongoing consultation for regulatory framework revisions that will enable the Greek market to incorporate biomethane as a new commercial activity.

DESFA, supported by consultants, is preparing a related study on amendments needed to existing laws – covering domains such as environmental and building matters – for the development of a biomethane market in Greece.

Biomethane could replace natural gas for the operation of a compressor station in Thessaloniki’s Nea Mesimvria area and another in Abelia, Thessaly, central Greece, now being developed.

Both locations are situated close to areas offering considerable waste quantities, which makes biomethane projects viable solutions that will significantly limit DESFA’s environmental footprint.

The biggest part of DESFA’s transmission network is relatively new and could, as is, or with minor revisions, host green gases, namely biomethane and hydrogen. New network sections now being developed would be ready to transmit green gases from the start.

DESFA is currently holding preliminary talks with market players for possible partnerships in a pilot biomethane project. However, the operator intends to finalize its biomethane business plan before deciding on any partnerships.

 

RAE decides on 12-month FSU rental for Revythoussa, 70% capacity boost

RAE, the Regulatory Authority for Energy, has decided on a 12-month rental solution for an FSU installation at the country’s LNG terminal on the islet Revythoussa, just off Athens, a move planned to increase the facility’s capacity by 70 percent at an overall cost estimated at 20 million euros, energypress sources have informed.

The FSU, to serve as an addition to three existing storage units at the Revythoussa LNG terminal, is planned for July, the sources added.

RAE’s finalized decision enables gas grid operator DESFA, operating the LNG terminal, to stage a second round of binding bids for reservation of capacities. The procedure is expected to take place imminently, by mid-May. Four companies participated in the non-binding first round.

The FSU to be moored will offer a capacity of between 150,000 and 174,000 bcm, increasing the terminal’s current capacity of 225,000 m3 to at least 375,000 m3.

 

 

Four Revythoussa FSU offers made, 6-month lease for start

Four companies have expressed non-binding interest in a procedure seeking FSU offers, both through lease and sale arrangements, for gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens.

The Revythoussa plan entails adding an FSU with a capacity of between 150,000 and 174,000 m3 to the LNG terminal, which would increase the facility’s current 225,000 m3 capacity, provided by three existing onshore storage units, to at least 375,000 m3, an increase of approximately 70 percent.

Local authorities were satisfied with the level of interest expressed by participants in the first-round procedure, staged to gauge the market for FSU availability. The procedure was staged with guidance from international broker SSY Gas.

A six-month lease solution for an FSU is now considered certain as an initial plan as RAE, the Regulatory Authority for Energy, keeps assessing market data to decide whether an FSU lease or purchase solution is best for Revythoussa over the longer term.

A follow-up tender inviting interested parties to submit binding bids will be staged as soon as RAE has reached its decision.

According to the plan’s schedule, a follow-up tender is planned for the first half of May. Officials aim to have an FSU moored at Revythoussa by the end of July.

 

Swift moves for Revythoussa capacity boost, FSU by July 30

Gas grid operator DESFA’s plan to boost the capacity of its LNG terminal on the islet Revythoussa, just off Athens, with the addition of a floating storage unit (FSU), is in full progress, the target date for its mooring being no later than July 30.

DESFA is now preparing to stage a related tender for this plan and, as a first step, is researching the international market to check on the availability of an FSU matching Revythoussa’s requirements, factors including the installation’s period, should a lease solution be chosen, and storage capacity.

RAE, the Regulatory Authority for Energy, is soon expected to decide on whether the FSU should be purchased or leased.

The authority is expected to hold a meeting today with DESFA officials to discuss the plan’s details.

DESFA has indicated it could lease an FSU for a period of between 12 to 18 months and, as part of this plan, would receive the vessel between May 1 and July 30.

The operator is moving fast as the European Commission has requested all EU natural gas storage facilities be filled to 80 percent of capacity by November 1. In addition, the danger of a Russian disruption of gas supply to Europe also requires swift action, as does the higher energy demand anticipated during the summer season.

 

Revythoussa LNG truck-loading station set for June launch

A prospective LNG truck-loading station at gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens, is expected to be launched in June, enabling up to 4,300 loads per year, according to a latest update from the operator.

DESFA submitted its proposals for operating framework revisions, as well as a pricing formula, to RAE, the Regulatory Authority for Energy, in December and is expecting these to be approved within the next few days.

Furthermore, the new LNG truck-loading station’s reservation platform is planned to begin operating next month, ahead of the station’s anticipated launch in June.

Due to LNG’s high concentration, the Revythoussa truck-loading station will enable specially equipped trucks to transport large quantities of the fuel along road routes, simulating natural gas pipelines for increased flexibility in gas supply.

Trucks loading LNG at Revythoussa will be transported to the islet by ferryboat. Routes to the islet will be offered from three different points around the wider Athens area, Elefsina, Perama and Almyra.

Revythoussa FSU purchase advantageous over rental

The purchase of a floating storage unit (FSU) for installation at the Revythoussa islet LNG terminal just off Athens, to boost the unit’s capacity for the country’s protection against a further supply crisis, is financially advantageous compared to a one-year rental of an equivalent floating storage system, officials at gas grid operator DESFA, operating the terminal, have determined following their analysis of a related cost-benefit analysis.

The analysis, forwarded for consultation by RAE, the Regulatory Authority for Energy, last Friday, compares the costs of purchase and rent solutions over a five-year period.

Taking into account depreciation over the five-year period, the purchase of an FSU works out to be 48.4 million euros cheaper than a rental solution, DESFA officials have calculated.

An FSU rental for one year would cost a net amount of 110.6 million euros, whereas a purchase would cost 172.8 million euros, ultimately beneficial over a five-year period, according to the DESFA officials.

A capacity boost at the Revythoussa LNG terminal is seen as crucial in the effort to protect the country’s energy supply security should Russia disrupt its natural gas supply to Europe.

If Moscow does decide to cut supply to the continent, Greece, it is estimated, will need to order an additional 50 or so LNG shipments over the next 12 months.

Revythoussa FSU 12-month rental or permanent solution

Greek authorities are making comparisons in preparation for a choice between an FSU one-year rental and a permanent floating storage unit at the Revythoussa LNG terminal as part of a plan to boost the country’s gas storage capacity ahead of next winter.

A decision for a capacity boost at the Revythoussa LNG terminal, with the addition of a fourth unit, has already been reached, highly ranked energy ministry officials have informed. A competitive procedure will be staged for the contract.

The option of renting an FSU for the Revythoussa LNG terminal, a facility operated by DESFA, the gas grid operator, would take approximately two months to complete, sources said.

This solution would make operations at the Revythoussa LNG terminal more flexible as it would enable unloading of two LNG orders simultaneously, instead of just one, as is the case at present.

A disruption of Russian gas supply to the EU would force all member states to try and secure additional LNG shipments.

The second alternative, entailing the installation of a permanent floating storage unit at the Revythoussa LNG terminal, would require more time to complete without offering any additional advantages, compared to the FSU rental, energy ministry officials noted.

Officials at RAE, the Regulatory Authority for Energy, are comparing market data such as domestic gas demand projections, and also considering Revythoussa’s prospects for a bigger role as a natural gas gateway for neighboring countries. Bulgaria and Romania are already using the Revythoussa terminal for LNG imports.

DESFA calls for doubled gas network capacity, PPPs

The country’s changing energy policy, especially following an EU decision aiming to drastically reduce Europe’s reliance on Russian natural gas, will require far greater gas transmission capabilities, inevitably prompting the need for a major network capacity boost, double the current capacity, with project participation from private-sector investors through public-private partnerships, DESFA, the gas grid operator, has informed RAE, the Regulatory Authority for Energy.

The EU’s energy policy, steering Europe towards energy-source diversification, promises to establish Greece as a southeastern transit country handling far bigger quantities than at present.

Speaking at the recent energypress Power & Gas Fourum, Michalis Thomadakis, DESFA’s Director of Strategy and Development Division, noted: “Certain projects need to be developed so that we can fully utilize the new role the Greek gas transmission system is being called upon to adopt in the wider region. This can only be done with investments. It basically means that the system’s capacity needs to be doubled.”

A disruption of Russian natural gas supply to Europe would create a need for approximately 40 bcm to the Balkan region. Much of this quantity would pass through Greek territory.

New infrastructure promising to greatly increase Greece’s LNG importing capacity is already in the making. Projects include the Alexandroupoli FSRU in the country’s northeast, the Dioryga Gas FSRU planned for the Korinthos region west of Athens, as well as an additional storage tank at Greece’s only existing LNG terminal on the islet Revythoussa, just off Athens.

Given these prospects, DESFA is currently looking to develop new pipelines and make network revisions that would facilitate greater quantities to other European markets.

 

 

Emergency steps taken for FSU at Revythoussa LNG terminal

The energy ministry appears to be pushing ahead with an emergency plan for swift installation of a floating storage unit (FSU) at the country’s only existing LNG terminal, on the islet Revythoussa, just off Athens, for increased LNG storage capacity ahead of next winter, sources have informed energypress.

Gas grid operator DESFA, the Revythoussa facility’s operator, has already researched the market for an appropriate vessel, which will need to be equipped with modern technology and recently built.

The FSU to be moored at Revythoussa will need to offer an LNG storage capacity of between 130,000 and 140,000 cubic meters to satisfy the Greek market’s needs, the sources noted.

Under normal conditions, procedures concerning this specific project would take over 12 months to complete and enable installation, but authorities are now moving fast as a result of the extreme impact Russia’s war on Ukraine has had on the energy market.

DESFA will present a cost-benefit analysis to the energy ministry by this Wednesday, according to sources.

 

 

 

War, energy crisis hastening plans for new LNG facilities

Russia’s war on Ukraine and the energy crisis are precipitating new natural gas and LNG supply solutions, a development that has increased the importance of related projects planned in Greece.

The EU’s decision to drastically reduce the continent’s reliance on Russian gas by two-thirds this year and terminate the dependence prior to 2030 has increased the importance of supply routes not linked to Moscow’s interests.

This development has increased the feasibility of new infrastructure promising to facilitate natural gas and LNG supply to Europe from alternative sources.

A major US-EU agreement established late last week for supply of an additional 15 bcm, at least, of American LNG to the continent this year, and gradual supply increases further ahead in time, has greatly boosted the prospects for related infrastructure.

The EU intends to follow up on this agreement by also establishing further supply deals with other producers, including Qatar and Egypt, in an effort to increase its LNG imports by a total of 50 bcm.

The EU’s new direction, focused on LNG imports, is seen as essential as the deterioration in relations between Europe and Moscow is expected to last many years.

Related projects in Greece promise to serve as LNG gateways for the country as well as southeast and central Europe, while also establishing Greece as a gas hub with an increased geostrategic role.

The Gastrade consortium recently decided to begin planning a second FSRU for Alexandroupoli, northeastern Greece, as an addition to a prospective first unit.

Petroleum group Motor Oil aims to begin development of its “Dioryga Gas” FSRU project, 1.5 km southwest of the company’s refinery in Korinthos, west of Athens, by the end of the year.

Gas grid operator DESFA is preparing to further upgrade its LNG terminal on the islet Revythoussa, just off Athens.

Also, the Mediterranean Gas company is planning to develop an FSRU at Volos port, on the mainland’s east coast. RAE, the Regulatory Authority for Energy, has already issued a license for this project.

In addition, another investor, still undisclosed, is set to begin licensing procedures for yet another FSRU in Greece, sources have informed.