FYROM

ELPE, seeing growth, to reopen northern pipeline late this year

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An oil pipeline stretching 213 kilometers from an ELPE (Hellenic Petroleum) facility in Thessaloniki to its Okta company refinery and storage facility in the Republic of North Macedonia is expected to be reopened towards the end of this year, roughly six years after the Greek petroleum group shut it down.

The matter has been included on the agenda for a meeting in Skopje today between officials from both sides of the border, led by their respective heads of state, Greek Prime Minister Alexis Tsipras and his North Macedonian peer Zoran Zaev. The two leaders have agreed to sign a series of bilateral agreements and memorandums of cooperation.

Swift progress is being sought in efforts to finalize a customs agreement, align the oil pipeline plan with EU standards and facilitate its licensing.

ELPE intends to utilize the relaunched oil pipeline to transport fuel, especially diesel, in annual quantities of around one million metric tons, far greater than the total consumption in North Macedonia. for exports to Bulgaria, Serbia and Kosovo, besides local sales.

ELPE plans to use its 350,000-metric ton storage facility, located 25 kilometers from the North Macedonian capital, as part of the export drive to regional markets.

The Greek petroleum group stopped operating this facility in 2013 after deciding it was no longer feasible to run.

A recent bilateral agreement between Greece and North Macedonia, until recently officially named Fyrom (Former Yugoslav Republic of Macedonia), has increased trading potential between the two countries and in the wider region.

ELPE controls 80 percent of its Okta venture in North Macedonia. The remaining stake is held locally. This equity balance will remain unchanged but Okta’s retail presence is expected to  increase.

Okta currently operates 27 petrol stations in North Macedonia. An exclusive partnership with Makpetrol, the neighboring country’s leading oil and oil products distributor running 121 petrol stations, promises to increase Okta’s share of retail fuel stemming from its refinery in North Macedonia to 65 percent.

 

DESFA, Windows International to battle for northern pipeline

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Respective applications submitted by Windows International Hellas, an enterprise controlled by Russian entrepreneur Leonid Lebedev, and Greece’s gas grid operator DESFA for the development of a gas pipeline interconnection running from Greece’s north into North Macedonia have both been approved by RAE, the Regulatory Authority for Energy, viewing  the proposals as rival initiatives.

Windows International Hellas and DESFA will now need do to battle for the project’s contract.

RAE had approved the Windows International Hellas application in December, but the news was not disclosed until now, according to sources.

DESFA has been granted conditional approval for its ten-year development plan covering 2017 to 2026, which includes the gas pipeline interconnection, a project budgeted at 48.7 million euros. Full approval remains pending and depends on the results of a required market test.

Windows International Hellas intends to develop the pipeline as an independent natural gas system, which would not burden users, whereas DESFA wants to develop the project as part of the national natural gas system, which explains why RAE has called for a market test. The test will determine if sufficient demand exists to avoid burdening users.

Windows International Hellas wants to utilize the pipeline for coverage of North Macedonia’s domestic needs. The Lebedev-led firm plans to construct a gas-fueled power station, it has been rumored.

DESFA is aiming to connect with networks in other Balkan countries through the prospective gas pipeline.

It is planned to run from Nea Mesimvria in Thessaloniki to Gevgelija in North Macedonia.

 

PPC list of electricity import traders for 2019 contains surprises

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The main power utility PPC’s list of traders chosen for electricity imports in 2019 from grid interconnections north of Greece contains certain surprises.

A number of major players have not made PPC’s recently approved list of traders for 2019, while firms limited to minor transboundary electricity trade roles last year –  through Greece’s grid interconnections with Bulgaria, Fyrom (Former Yugoslav Republic of Macedonia) and Albania – have been included.

PPC’s list of traders for 2019 is comprised of Alpiq, CEZ, EFT, Elpetra, Enmar, Freepoint, Grand Energy, HSE, Green, LET and Terna Energy Trading.

Four of these, Elpetra, Enmar, Freepoint and Grand Energy, were not involved in any trading activity with PPC last year.

According to a related monthly industry report, electricity imports last December were provided by six traders, these being Alpiq (33.302 MWh), CEZ (19 MWh), EFT Slovenia (21.295 MWh), HSE (28.375 MWh), GreenEnv (33.116 MWh) and LE Trading (1.417 MWh).

PPC and Alpiq operate a subsdiary firm in Bulgaria focused on transboundary electricity trade.

 

 

 

Name agreement developing Fyrom into ELPE oil hub

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A bilateral agreement between Greece and Fyrom (Former Yugoslav Republic of Macedonia) for a change of name by the latter to the Republic of North Macedonia is providing further momentum to talks between ELPE (Hellenic Petroleum) and the neighboring country’s government for the reopening of an oil pipeline stretching 213 kilometers from the Greek petroleum group’s Thessaloniki facilities to its Okta company refinery across the northern border.

The two sides are close to finalizing an agreement for the pipeline’s relaunch, sources informed. The facility was shut down in 2013 when ELPE decided it was no longer feasible to keep it running.

The Greek company used the pipeline as a channel of transportation for crude from its Thessaloniki plant to the Okta unit in Fyrom.

Road networks have been used to supply fuels to Fyrom since 2013 but transportation costs and smuggling activity have risen sharply at the expense of both Fyrom and ELPE, the neighboring market’s main supplier.

Besides supplying the Fyrom market, ELPE’s Okta refinery also promises to serve as a hub for the wider region. Wider growth in Balkan countries over recent years was a catalyst in the ELPE board’s decision to reopen the pipeline to its Okta plant.

ELPE maintains a market presence in Bulgaria, Serbia, Montenegro and Fyrom, operating more than 200 petrol stations in total. The pipeline’s reopening is expected to facilitate ELPE’s entry into new markets.

 

RAE: Market interest needed to develop Greece-Fyrom pipeline

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Sufficient market interest will be needed if a natural gas pipeline linking Thessaloniki and Fyrom (Former Yugoslav Republic of Macedonia) and an LNG bunkering facility on the islet Revythoussa, just of Athens, are to be developed, RAE, the Regulatory Authority for Energy, has noted in response to a ten-year gas system development plan (2017-2026) submitted by gas grid operator DESFA.

RAE offered its conditional approval of DESFA’s plan for the Thessaloniki-Fyrom pipeline, a project budgeted at 48.7 million euros, as long as market test, including binding capacity reservation offers, is previously conducted.

As for the Revythoussa LNG bunkering facility plan, the energy authority acknowledged the project could be required in the future as a result of the shipping LNG market’s anticipated growth, while noting DESFA has yet to submit a complete plan and feasibility study supporting its sustainability.

A decision on the induction of this project into DESFA’s ten-year plan will be reached once a comprehensive plan has been submitted, RAE added.

DESFA is looking at developing an LNG bunkering facility to serve the refueling needs of vessels with capacities ranging from 1,000 to 20,000 cubic meters.

RAE also approved a plan for the development of a natural gas compressor station needed for the gas system’s hydraulic stability once the TAP pipeline, running through northern Greece, begins operating.

ELPE oil pipeline from Thessaloniki to Fyrom seen reopening March

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An oil pipeline stretching 213 kilometers from Greek petroleum group  ELPE’s Thessaloniki facilities in the country’s north to its Okta company refinery across the northern border in Fyrom (Former Yugoslav Republic of Macedonia) is expected to reopen around March after the firm ceased using this channel in 2013, ruling it, at the time, as inefficient and unprofitable.

The ensuing road transportation of fuels has sharply increased costs and smuggling activity.

ELPE and Fyrom’s administration are ready for the oil pipeline’s reopening, sources have informed. However, constitutional changes concerning a bilateral agreement for Fyrom’s name change to the Republic of North Macedonia, requiring several rounds of voting in parliament, still need to be completed before oil quantities can be transported through this pipeline.

The ELPE group is currently using its Okta company refinery as a storage facility. Balkan regional growth experienced in recent years has rekindled the Greek petroleum firm’s interest in the Okta unit as a transit center for distribution of petroleum products in Fyrom and other countries in the region.

ELPE maintains a market presence in Bulgaria, Serbia, Montenegro and Fyrom, operating over 200 petrol stations.

The Thessaloniki-Fyrom oil pipeline’s reopening is expected to significantly reduce fuel transportation costs to these markets.

 

DESFA, MER resume talks for Greece-Fyrom pipeline link

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Greek gas grid operator DESFA and Fyrom (Former Yugoslav Republic of Macedonia) state-run energy company MER Skopje have resumed talks for the development of a pipeline interconnection intended to link the gas grids of the neighboring countries.

Highly ranked MER Skopje officials have been in Athens over the past week for talks with DEFSA officials focused on technical and financial aspects, energypress sources have informed.

DESFA and MER Skopje signed a Memorandum of Cooperation in 2016 for the project, but progress was slow before eventually stalling.

Less than a fortnight ago, MER Skopje and Albagaz signed a Memorandum of Understanding to promote a gas grid interconnection plan linking Fyrom and Albania, at a ceremony in Tirana that was attended by ministers of both countries.

Greek licensing procedure delays have been cited as a key reason behind the country’s lack of action in the Greece-Fyrom pipeline interconnection project.

The matter has been further complicated by an initiative taken last year by Russian entrepreneur Leonid Lebedev’s Windows International Hellas for a license to construct a natural gas pipeline from Thessaloniki to Fyrom.

RAE, Greece’s Regulatory Authority for Energy, has yet to deliver licensing decisions on either project.

Skopje is continuing to support the DESFA-MER Skopje project despite the recent MoU signed by MER and Albagaz, according to sources.

Greece supporting energy projects ahead of FYROM vote

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Energy minister Giorgos Stathakis will head a Greek delegation of key energy-sector figures on a visit to the Former Yugoslav Republic of Macedonia (FYROM) for energy investment talks with FYROM government officials on September 24 and 25.

The visit has been timed just days ahead of the neighboring country’s September 30 referendum asking voters if they support EU and NATO membership by accepting a recent agreement between their country and Greece over a new name for FYROM, the Republic of Northern Macedonia, to be used for both domestic and international purposes.

The name dispute, 27 years long, has kept the smaller and younger country out of international institutions.

The two sides have not ruled out the signing – during the two-day visit – of Memorandums of Cooperation for energy projects that would provide energy security to the neighboring country and highlight Greece’s prospective role as an energy hub.

Representatives of Greek natural gas grid operator DESFA, Hellenic Petroleum (ELPE) and power grid operator IPTO will join Stathakis, the energy minister, on the visit, also seen as an attempt by Greece to encourage a “yes” vote in the referendum.

 

PPC eyeing Fyrom, Albania, Turkey to offset local retreat

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Greece’s main power utility PPC, keen to gain from the opportunities offered by an early entry into a foreign electricity market now being liberalized, is looking to acquire EDS, an electricity trading company with a 320 MW portfolio in Fyrom, the Former Yugoslav Republic of Macedonia, representing 40 percent of the neighboring market, and possessing a presence, through subsidiaries, in the Serbian, Slovak and Kosovo markets.

Facing severe bailout-required market share contraction targets in Greece, PPC is desperately seeking to offset its anticipated domestic retreat with the generation of revenues abroad.

Though it is still too early for PPC to make any formal announcements on investment objectives in the wider region, the power utility has, for quite some time now, been examining a variety of prospects, including investing in Albanian hydropower facilities. PPC has already established a subsidiary in Albania.

Turkey is another neighboring market being examined by PPC. Early last month, PPC’s chief executive Manolis Panagiotakis, speaking at the American-Hellenic Chamber of Commerce’s annual “Greek Economy Conference”, revealed that the Greek power utility was looking to acquire the development rights for a power station in Turkey’s Eskisehir area, in the northwest, with Chinese firm Shenhua as the investment’s partner. “Our strategic choice is to become leaders in the region, which will enable us to develop as a modern electricity company,” Panagiotakis had remarked, suggesting PPC needs the support of foreign capital to remain afloat.

The Eskisehir plan entails the development of a 1,080-MW power plant, according to Turkish media. Lignite deposits in the area currently belong to EUAS (Electricity Generation Inc), which, along with the prospective power facility, represent part of a privatization plan. A January 26 deadline has been set for binding offers, while, according to local media, the winning bidder will be able to sell electricity production to the Turkish grid, through this facility, at a minimum tariff level of 5 to 6 dollars per KWh.

According to the bailout terms, PPC needs to reduce its Greek retail electricity market share to 49 percent by 2020.

 

 

ELPE firm OKTA, dominating Fyrom market, gets cost bonus and prize

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Gasoline retailer OKTA, a member of the ELPE (Hellenic Petroleum) group, has established itself as a dominant player in the Former Yugoslav Republic of Macedonia (Fyrom), where it stands as the neighboring country’s biggest gasoline supplier by far.

OKTA was ranked third, based on total turnover, in a list of Fyrom’s 200 biggest enterprises published by local economic news magazine Capital. OKTA’s total turnover reached 311 million euros, a 5.6 percent drop compared to the previous year.

The publication’s top-200 list includes seven more Greek or part-Greek enterprises.

Greece’s diplomatic mission in Fyrom is keeping a close watch on the country’s economic developments and other matters of interest to Greek enterprises interested in the neighbouring market. Athens is being updated on a regular basis.

Fyrom’s newly appointed government, embraced by the EU and USA, is keen to improve the country’s bilateral ties with Greece.

Part of this effort includes the implementation, as of January 1, of a delayed directive stretching back to 2009 concerning storage costs of required fuel reserves. Until now, these storage costs have been covered by petroleum firms without any compensation. Given its dominant market share, OKTA has shouldered a considerable part of this cost. Fyrom’s new administration has decided to implement the aforementioned directive, which will rid OKTA of the considerable storage costs it has been forced to cover.

OKTA was one of three Greek enterprises to receive a prize in an annual competition staged by Fyrom’s economy ministry in recognition of corporate social responsibility. The Greek petroleum firm received an award for its contribution to the country’s traffic education and road safety.

ELPE’s Thessaloniki-Fyrom oil pipeline closer to reopening

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Talks for the reopening of an oil pipeline running from ELPE’s (Hellenic Petroleum) refinery in Thessaloniki to another company-owned refinery in the Former Yugoslav Republic of Macedonia (Fyrom) appear likely to resume following the seeming normalization of the political arena in the neighboring country as a result of the recent elections.

Fyrom’s new government, headed by Prime Minister-designate Zoran Zaev, set to assume power in June, will today seek a vote of confidence in parliament with the aim of restoring political normalization. This initiative is expected to unblock various investments, including the ELPE-controlled oil pipeline.

If all goes well, ELPE and Fyrom government officials should hold talks on the matter within the next few months and, if successful, pave the way for the oil pipeline’s reopening for the first time since 2013, when the  inftrastructure was last used.

The oil pipeline’s prospective reopening will enable ELPE to supply its petroleum products to the neighboring market at a lower cost, eliminating current intermediary costs, and, further on, open up new routes to markets such as Serbia and Kosovo.

The pipeline’s reopening would devastate illicit petroleum product traders who have benefited from the pipeline’s protracted closure. Illicit traders have exploited the situation by declaring large amounts of petroleum products for export, thereby avoiding special consumption tax (EFK) and VAT, only to end up selling these amounts tax-free within the Greek market.

Beside’s Fyrom’s political instability, the influence of fuel smugglers is believed to have prolonged the pipeline’s closure.

ELPE acquired OKTA, its Fyrom refinery, in 1998 and, four years later, developed a pipeline linking its Thessaloniki and Fyrom units.

ELPE is not expected to use its OKTA unit as a refinery in the future as it has become obsolete and requires major investment amounts to become operational again.

Russian tycoon behind license bid for Greece-Fyrom gas link

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A recent license application submitted to Greek authorities by Windows International, discreetly placed behind various interests, for a propective interconnection project planned to link the Greek and Fyrom (Former Yugoslav Republic of Macedonia) natural gas networks, a key part of the government’s intention to establish Greece as an energy hub, has raised eyebrows and questions.

Windows International does not have a past in Greece’s energy sector. Interestingly, following research, it was determined that Alexander Lebedev, a Russian businessman referred to as one of the Russian oligarchs, is behind the initiative.

Windows International submitted a request to RAE, the Regulatory Authority for Energy, late in March for a 50-year license concerning the Greek-Fyrom gas network interconnection, planned to offer an annual capacity of 1.5 bcm and cover roughly 50 kilometers within Greek territory.

DESFA, Greece’s natural gas grid operator, recently signed an MOU with MER, its Fyrom counterpart, for the construction of a 160-km gas pipeline linking northern Greece with Stip in Fyrom. This project would provide Fyrom with direct access to Greece’s existing LNG terminal on the islet Revythoussa, just of Athens, and could also be linked with other projects, including the TAP pipeline.

The interest expressed by Windows International is believed to be linked to this plan. According to sources, the Greek Prime Minister’s office had been informed of Western International’s interest before the company submitted its license bid to RAE.

The application was submitted by Windows International Hellas SA, a subsidiary of Windows International, based in Luxembourg, RAE has informed.

The company’s Greek subsidiary is an unknown entity, while, surprisingly, obtaining information on its parent company proved difficult. The parent company does not maintain a company website. Besides its Luxembourg address, little other information is on record.

However, deeper exploration showed that Christian Tailleur, a member of the Ordre des Experts-Comtables (OEC), a professional organization of chartered accountants who possesses an extensive banking and investment past, and Toni Baev, the executive director at Balkan Utilities, active in Balkan energy-sector ventures, are both listed as Windows International representatives on the EU Transparency Register.

Furthermore, Tailleur is the head representative in Luxembourg for Cyprus’s Totalserve, active in specialized accounting, finance and other related services. Totalserve and Windows International share the same Luxembourg address. Totalserve also maintains an office in Athens.

Returning to Lebedev, the Russian tycoon, his corporate base is in London, where he publishes The London Evening Standard and The Independent newspapers. In 1995, Lebedev took over Russia’s then-troubled National Reserve Bank (NRB), which, under his leadership, was not only saved but grew.

Through NRB, Lebedev maintains a big energy-sector portfolio that includes a major stake in Russian electricity company RAO and Gazprom interests.

 

Bulgarian, Fyrom energy developments monitored

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Greek diplomats stationed in other Balkans countries are keeping a close watch on local energy-sector developments and their implications, positive and negative, for Greece’s aim of becoming a regional energy hub.

Most recently, Greek diplomats informed Athens of a change of guard at ICGB, the consortium behind the development and management of the prospective IGB (Greek-Bulgarian Interconnector) pipeline project. Teodora Georgieva was replaced by new CEO Valentin Haralambiev, who possesses extensive experience in gas-sector infrastructure projects and is expected to speed up the IGB project.

An objective has been set for this pipeline interconnection project to begin operating by early 2020.

Bulgarian Energy Holding (BEH) holds a 50 percent stake in the consortium, also including DEPA, Greece’s Public Gas Corporation, and Italy’s Edison.

BEH issued a statement noting that the natural gas interconnection with Greece represents a “significant priority for the Bulgarian government’s energy policy.”

According to the Greek Embassy in Sofia, Bulgaria’s interim energy minister Nikolay Pavlov, speaking to an audience of European energy authorities at last month’s 3rd Southern Gas Corridor Advisory Council, held in Baku, noted that his country’s government is working intensively so that construction of the project’s segment concerning Bulgaria may begin early in 2018.

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

Greek diplomats have also been drawn to energy developments in the Former Yugoslav Republic of Macedonia (Fyrom).

Reporting on a recent roundtable discussion organized by Fyrom’s Chamber of Commerce on supply security concerning petroleum and other products, the Greek Embassy informed that participants agreed Thessaloniki port and Corridor X – a route linking the cities Thessaloniki, Skopje, Belgrade, Zagreb and Budapest – represent the most advantageous and safest passage for Fyrom’s trading and economic interests. The head of OKTA, an ELPE (Hellenic Petroleum) subsidiary, was among this session’s participants.

 

DESFA, Fyrom’s MER sign MoU for gas pipeline interconnection

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The top officials of DESFA, Greece’s natural gas grid operator, and Former Yugoslav Republic of Macedonia (Fyrom) energy company MER have signed a memorandum of understanding for construction of a 160-kilometer gas pipeline to interconnect the two neighboring countries.

The MoU, signed by DESFA president Sotiris Nikas and his counterpart at MER, Krste Miladinov, concerns a pipeline planned to run from Nea Mesimvria in northern Greece to Stip in Fyrom. It will provide Fyrom with direct LNG supply from Greece’s terminal in Revythoussa, an islet just off Athens.

The interconnection will also allow Fyrom to connect to the major TAP (Trans Adriatic Pipeline) project in progress as well as other prospective nearby gas corridors such as Turkish Stream or South Stream.

The DESFA chief said two working groups will now be set up to focus on a feasibility study, the corridor’s design and construction.

The prospect of the development of a gas pipeline linking Greece and Fyrom was first mentioned last spring by Greek energy minister Panos Skourletis during a speech at an energy-sector event, Athens Energy Forum. The respective foreign ministers of both countries then signed a preliminary agreement last August during a vist to Skopje by Greece’s foreign minister Nikos Kotzias.