Local gas network expansion to promote projects abroad

It may not seem apparent at first, but DEPA’s (Public Power Corporation) drive to expand the domestic natural gas network, offering natural gas access to as many consumers as possible, as part of a new strategy adopted by the corporation, is interlinked to the prospective development of major gas infrastructure projects in the wider region, beyond the borders.

The objective of DEPA’s administration is to increase local natural gas consumption, which, it is anticipated, will provide impetus to major projects such as the TAP (Trans Adriatic Pipeline); the revised ITGI project to establish a route for Russian gas through the Southern Corridor across the Adriatic Sea to Italy; the Greek-Bulgarian IGB interconnector, and the floating LNG station in Alexandroupoli, northeastern Greece.

According to available estimates, development of the domestic natural gas network can generate a 20 percent local natural gas consumption boost by 2021 or 2022.

The network development strategy is based on three fronts. Firstly, authorities will seek to expand networks in regions within close proximity of the central transmission system. Secondly, CNG will be transported by tank trucks to remote areas where compressors will be installed and local networks developed, to the degree that consumption levels justify such an investment. Thirdly, LNG facilities will be developed at ports.

Funding for these projects is expected to be made through EU peripheral development programs, DEPA capital, and, possibly, loans from European investment banks, if this is feasible.

The expansion plan’s first stage, covering the period 2016-2025, concerns four regions – Eastern Macedonia-Thrace; mainland Greece-Evia; Central Macedonia, and western Greece. Preliminary work is most advanced for the first three of these regions. LNG transporation is planned to cover western Greece. An area at the Patras port has already been made available for a prospective LNG facility.

The new domestic natural gas network, planned to be constructed by the end of 2021, will add roughly 1,300 kilometers to its exisiting 450 kilometers.

Some 160,000 new natural gas consumer connections are expected to be made over the next decade – 140,000 for household use, 19,000 for commercial use, and 350 for industrial use.

Natural gas network ‘to be expanded to 17 provincial cities’

DEPA, the Public Gas Corporation, plans to expand Greece’s natural gas network so that it may reach an additional eleven provincial cities, and also supply a futher six with tank trucks.

Energy minister Panos Skourletis presented two separate lists for the aforementioned categories during an all-encompassing news conference yesterday.

Alexandroupoli, Komotini, Xanthi, Kavala, Serres, Drama, Kilkis, and Katerini, all in Greece’s north, as well as Lamia, Thiva, and Halkida, are the eleven provincial cities to which DEPA plans to expand its natural gas network.

The second list, concerning supply with tank trucks, is comprised of Patras, Amfissa, Livadia, Karpenisi, Veria, and Orestiada.

Although Greece’s natural gas pipeline network has existed for years, it has simply passed by cities and “gestured hello” Skourletis noted yesterday, criticizing his predecessors at the energy ministry for not having branched out the pipeline to other areas.

The natural gas network’s expansion is included on DEPA’s ten-year investment plan, announced just days ago by the corporation’s CEO Theodoros Kitsakos at an energy conference.

The network’s expansion plan will entail constructing an additional 850 kilometers of pipeline infrastructure, in addition to the existing 460-kilometer network, for a total of 1,310 kilometers, according to DEPA’s ten-year plan.

The initiative promises to connect 140,000 households, 19,000 businesses, and 350 large-scale industrial enterprises to the country’s gas network, while new jobs will also be created, DEPA noted.

According to Kitsakos, Greece’s annual natural gas consumption is forecast to increase to eight billion cubic meters over the next fifteen years, or 0.6 billion cubic meters per year. At present, the consumption level stands at 3 billion cubic meters.

 

Minister critical of PPC tariffs, content with creditor talks

The main power utility PPC’s electricity tariffs will be reduced for all household categories, under the condition that the utility’s just-revised payback scheme, offering softer terms for PPC consumers with arrears, improves the corporation’s electricity bill collection effort and international crude oil and natural gas prices remain low, the energy minister Panos Skourletis noted at a news conference today.

The current combination of lower household incomes in Greece, down by as much as 45 percent over the past few years, and electricity tariff increases by an equivalent percentage, or possibly more, cannot go on any longer, the minister noted, obviously critical of PPC.

PPC’s revised payback scheme, which will be launched tomorrow and offers all consumers the right to settle arrears over 36 installments without any deposit payment, emerged following pressure applied on the utility by the government.

During the news conference, Skourletis acknowledged that PPC’s large amount of unpaid recievables, estimated at 2.3 billion euros by the utility, have negatively impacted its financial standing and ability to reduce electricity tariffs in the immediate future. Earlier this week, PPC reported a 102 million-euro loss for 2015.

As for the natural gas sector, the minister left open the prospect of a tax hike on natural gas but stressed that, even if imposed, prices would remain lower than last year.

Skourletis condemned the EPA Attiki gas supply company, which covers the wider Athens area, for not having sufficiently decreased its natural gas prices. The company lowered its prices by 11 percent last year, compared to 24 percent by EPA Thessaloniki and EPA Thessalia, the energy minister pointed out.

However, Skourletis partially justified EPA Attiki, saying that the discrepancy could be attributed to the much greater penetration of natural gas in the Thessaloniki and Thessalia markets, which makes operating costs for these suppliers lower.

Acknowledging that the cost of natural gas for the industrial sector is hefty, Skourletis said officials are examining ways to reduce the level of various components leading to the final price. An informal committee is looking into the issue, he said.

The minister expressed satisfaction over the progress being made in negotiations with the country’s creditor representatives for major energy-sector matters, especially plans to introduce NOME-type auctions into the Greek market and split the power grid operator IPTO from PPC, its parent company. Both issues will soon be finalized, when creditor representatives return for a bailout deal review, Skourletis said.

The effort to sell a 66 percent stake of DESFA, the gas grid operator, to Azeri energy company Socar and other certified European operators has stalled as a result of a dispute concerning network usage fees. Skourletis wants to nullify original terms that would allow the prospective buyers to significantly increase network usage fees by levels of as much as 60 percent. These network usage fees represent DESFA’s earnings. Skourletis said the Greek government had forwarded a proposal to Socar and is awaiting a response.

The minister declared official the government’s interest in steering PPC towards corporate partnerships with private-sector investors for ventures that would include PPC’s lignite-fired power stations and hydropower facilities. “All is open for discussion,” he commented.

Skourletis also highlighted the importance of major infrastructure projects headed for development, such as the TAP natural gas pipeline, to carry Azeri gas to central Europe via northern Greece, Albania and Italy, and whose construction will be officially launched at a ceremony in Thesssaloniki on May 17; the Greek-Bulgarian IGB interconnector; as well as a floating LNG terminal in Alexandroupoli, northeastern Greece.

 

 

 

TAP has reached deals with some 150 Greek firms, country manager highlights

The TAP consortium has established partnerships with about 150 Greek companies, including DESFA, the gas grid operator, and various companies supplying products and services, Rikard Scoufias, the pipeline’s country manager in Greece, told an energy conference in Athens today.

Scoufias, who delivered a speech at a conference organized by TEE, the Technical Chamber of Greece, titled “Energy Market: Unlocking Greece’s Economic Potential,” noted that construction of the TAP pipeline, to supply mostly Azeri natural gas to central Europe via northern Greece, Albania and Italy, will begin in 2016.

Over 450 meetings were required with local authorities to settle compensation details for owners of property through which the TAP pipeline will cross, Scoufias noted, while adding that the Greek government’s support came as recognition of the consortium’s efforts and procedures.

Socar remains interested in DESFA deal, local chief declares

The Azeri energy company Socar remains interested in completing its long-delayed acquisition of a stake in DESFA, Greece’s gas grid operator, Anar Mammadov, managing director of its local subsidiary, Socar Energy Greece, announced today, responding to reports contending that the company was set to withdraw.

Azeri energy exports will increase drastically over the next few years as new deposits are being developed, the Socar official remarked, adding that the company’s objective is to ensure that supply will be carried out with fair access to networks. More control over networks will help achieve this objective.

Mammadov also stressed that a Greek plan to upgrade the country’s LNG terminal in Revythoussa, an islet in the Saronic Gulf, close to Athens, by adding a third storage tank, is of crucial importance for supply in the wider region.

Socar had originally agreed to acquire a 66 share of DESFA as the winning bidder of an international tender finalized in 2013, but must now surrender 17 percent following European Commission intervention over EU energy security and competition concerns.

Just weeks ago, it was reported that European candidates considering to take on the surrendered 17 percent were advised by consultants to avoid the move as a result of the risk factor surrounding investments in Greece and the possibility of regulatory revisions that would lessen the gas operator’s revenue potential.

 

Skourletis: ‘Greece can develop into a regional energy hub’

Greece’s energy policies as part of a wider European Commission strategy aiming for energy union and security in the EU were discussed during a meeting in Athens yesterday between energy minister Panos Skourletis and Maros Sefcovic, the European Commission vice president responsible for Energy Union.

The two officials focused on the importance of prospective European interconnection projects, both in the natural gas and electricity sectors, institutional framework revisions made in the Greek gas market, as well as expected revisions in the renewable energy (RES) sector.

“We discussed all the issues concerning energy in the EU and, obviously, how these are being shaped for our country,” Skourletis remarked following the meeting. “Greece now possesses all the prerequisites to become a regional energy hub. This prospect is based on the major projects planned – the natural gas pipelines as well as electricity interconnections,” he added.

Describing the session as highly constructive, Skourletis also noted that the efforts being made by all EU member states to achieve secure, reliable, and lower-cost services, both for households and enterprises, were also discussed.

Skourletis and Sefcovic, joined by officials representing DESFA, Greece’s gas grid operator, DEPA, the Public Gas Corporation, and the energy ministry, also visited the LNG terminal facility on Revythoussa, an islet in the Saronic Gulf, close to Athens, where progress on the development of an additional third LNG storage tank was presented.

The Revythoussa facility has acquired a more crucial role as a result of the EU’s increased gas needs in more recent times, as well as the plan to widen LNG supply. The Revythoussa facility’s expansion is expected to be completed within 2017.

 

 

Energy union head reiterates EU support for TAP, IGB in talks with PM

Talks between Prime Minister Alexis Tsipras and Maros Sefcovic, the European Commission vice president responsible for Energy Union, at a meeting in Athens yesterday, primarily focused on Greece’s prospective role as a key energy hub and gateway for new gas entering Europe from the Caspian region, the visiting official told reporters afterwards.

Sefcovic, who is touring European capitals to check on the energy union progress of EU member states, reiterated the European Commission’s full support for the development of both the TAP and Greek-Bulgarian IGB natural gas pipeline projects.

Tsipras told the visiting official that Greece is playing a crucial role in the regional energy sector’s future as a result of the country’s geographical position, while also making note of the effort being made by Athens to utilize opportunities such as that of the prospective TAP natural gas pipeline.

Construction work on the Greek segment of this infrastructure project, to bring new gas to Europe via Greece’s north, Albania and Italy, is scheduled to officially commence in May. A ceremony is planned to take place in Thessaloniki to mark the start.

In an exclusive comment to the Athens News Agency, the European Commission’s vice president said Greece is making satisfactory progress on energy efficiency objectives set as part of the EU’s wider drive towards energy union.

The visiting official said he offered encouragement to Athens to continue pursuing reforms in the energy sector, while adding that he will contribute to an effort for Greece to utilize EU structural funds for investments in energy efficiency projects.

The Commission’s vice president noted that he and Greek partners are looking for ways to boost Greece’s level of innovation, growth, and competitiveness, which, he added, would offer benefits to the Greek economy, citizens and the integrated European energy market.

 

TAP construction set for June following Commission approval

Construction of the TAP (Trans Adriatic Pipeline), to bring new gas to the EU and increase the security of energy supply for Southeast Europe, is set to begin in June, based on the current schedule, following yesterday’s approval by the European Commission.

The prospect is extremely promising for Greek firms that have already been commissioned segments of the project or are presently vying for contracts linked to other sections.

Yesterday’s approval by Brussels essentially declares that the favorable conditions granted by Greece to the TAP consortium, especially ones concerning taxation for a 25-year period from the launch of commercial activity, are compatible with EU law concerning state aid and do not distort competition in the EU market.

The European Commission’s decision, noting that EU law is not violated, means that no other obstacles lie ahead, giving the green light for the TAP project’s development.

Greece’s bolstered geopolitical standing, promising a positive and direct impact on the national economy, stands as a major benefit gained courtesy of the prospective gas pipeline, to run through northern Greece, Albania, and across the Adratic Sea to Italy.

The expected boost for local employment and commercial activity is another benefit. It is estimated that nearly 10,000 jobs will be created in Greece, direct and indirectly, as a result of the TAP project’s development. The involvement of Greek construction companies, as well as supply of local materials, is another plus for the local economy.

According to the TAP consortium, some 150 Greek firms, small and medium-sized, have already signed sub-contract agreements with the consortium. This figure does not include the major firms that succesfuly took part in tenders for contracts concerning construction and supply of materials.

Pipelines

Corinth Pipeworks, a subsidiary firm of Viohalco, belonging to the Stasinopoulos corporate group, has already signed a deal to supply large-diameter pipelines covering TAP’s overland course through Greece, roughly 495 kilometers long. The Greek firm was up against Japanese company Marubeni-Itochu Steel, a global powerhouse, in the tender for this supply agreement.

Corinth Pipeworks, which has invested over 65 million euros for a new production line manufacturing high-pressure overland and underwater pipes, is expected to begin supplying its pipelines within 2016 before completing the delivery in 2017.

Construction

J&P-Avax, as part of a consortium with Italy’s Bonatti, has been awarded a contract through an international tender to construct two of the pipeline project’s three Greek segments  The third segment will be constructed by a consortium made up of Ellaktor and France’s Spiecapag. This consortium is also vying for a segment within Albanian territory. The GEK Terna group appears to be contesting a contract for the construction of compressor stations.

The contracts for the TAP project’s three Greek segments, totalling 550 kilometers, are each worth roughly 230 million euros.  

Besides the TAP project’s 550 kilometers of overland pipelines to run across Greece, a further 211 kilometers will be installed in Albania, and 8 kilometers in Italy.

Cables

Two more international tenders expected to attract Greek industries are currently in progress. One tender concerns the TAP pipeline’s SCADA (supervisory control and data acquisition) system, and the other supply of fiber optic cables measuring 1,550 kilometers. Local industry Hellenic Cables is participating in the latter tender.

TAP consortium

Trans Adriatic Pipeline AG is a joint venture company registered in Switzerland. Its shareholders are BP (20%), SOCAR (20%), Snam (20%), Fluxys (19%), Enagás (16%) and Axpo (5%).

The TAP pipeline is the European leg of the Southern Gas Corridor, which aims to connect the EU market to new gas sources. With an initial capacity of 10 billion cubic metres of gas per year, the pipeline will transport gas from the Shah Deniz II field in Azerbaijan to the EU market as of 2020.

The Trans Adriatic Pipeline is recognised as a project of common interest (PCI) in the framework of the EU’s Trans-European Energy Infrastructure Guidelines. PCIs are aimed at helping create an integrated EU energy market and are essential for reaching the EU’s energy policy objectives of affordable, secure and sustainable energy.

The Commission published its first list of PCIs in 2013. The list is updated every two years to integrate newly needed projects or to remove obsolete ones. The current PCI list was approved on November 18, 2015.

 

 

 

Commission approves Greece-TAP agreement for pipeline

The European Commission has found the Host Government Agreement between the Greek authorities and the Trans Adriatic Pipeline to be in line with EU state aid rules, it announced today, noting that the project will improve the security and diversity of EU energy supplies without unduly distorting competition in the Single Market.

The Commission’s agreement on state aid was one of the prerequisites within the Host Government agreement that still needed to be obtained before the Trans Adriatic Pipeline project could start.

Margrethe Vestager, Commissioner in charge of competition policy, stated: “Today’s decision opens the way for a multi-billion infrastructure project in Greece. The Trans Adriatic Pipeline will bring new gas to the EU and increase the security of energy supply for Southeast Europe. The investment incentives offered by the Greek Government are limited to what is necessary to make the project happen and in compliance with state aid rules.”

Maroš Šefčovič, Vice-President responsible for Energy Union, said: “Today’s approval of the TAP agreement is an important step towards completing the Southern Gas Corridor. The Energy Union framework strategy of February 2015 identified this project as a key contribution to the EU’s energy security, bringing new routes and sources of gas to Europe. Just on Monday, the Southern Gas Corridor ministerial meeting in Baku, which I attended, confirmed the determination of all participating countries and consortia to complete this key infrastructure project on time.”

The Trans Adriatic Pipeline is the European leg of the Southern Gas Corridor, which aims to connect the EU market to new gas sources. With an initial capacity of 10 billion cubic metres of gas per year, the pipeline will transport gas from the Shah Deniz II field in Azerbaijan to the EU market as of 2020. The Trans Adriatic Pipeline will run from the Greek border via Albania to Italy, under the Adriatic Sea. The builder and operator of the pipeline is Trans Adriatic Pipeline AG (TAP), a joint venture of several energy companies. TAP will invest 5.6 billion euros over five years in the project, 2.3 billion of this in Greece.

The Host Government Agreement between Greek authorities and TAP sets out how the TAP consortium will construct and operate the pipeline and defines the respective obligations of the parties. In particular, the agreement provides TAP with a specific tax regime for 25 years from the start of commercial operations. This may give the company an economic advantage over its competitors, who would not benefit from the specific tax regime, and therefore involves state aid in the meaning of the EU rules.

The Commission assessed the measure under its 2014 Guidelines on state aid for energy and environmental protection. The Guidelines state that such aid can be found compatible under certain conditions when it furthers objectives of common interest. The Commission found that:

  • the project will contribute to further diversification of European energy supply sources and routes: it will bring gas from the Caspian Sea region and potentially the Middle East to the EU;
  • competition in the European gas market will be increased thanks to the extra volumes of gas and new supply route;
  • the construction of the pipeline requires substantial upfront investment over several years before any revenue will be generated. The project will be funded entirely by private investment and will generate revenues in its Greek part only from the tariffs paid by clients shipping gas through the pipeline. The Commission concluded that the project would most unlikely not be  carried out without aid;
  • the aid is in the form of a specific tax regime that, depending on whether tax rates increase or decrease, will lead TAP to pay more or less tax than it would without the aid. If the rates increase the aid will be limited to the minimum tax benefit for TAP;
  • in particular, the scheme has a built in adjustment mechanism that limits the maximum benefit for TAP. If the Greek equivalent applicable tax rate were to rise or fall beyond 20%, an adjustment mechanism to recalculate TAP’s contribution will come into effect. The Greek authorities will monitor this to ensure that TAP complies with the methodology and therefore the aid is limited to the minimum necessary.

The Commission therefore concluded under the Guidelines that the project’s benefits in terms of increased competition and security of energy supply clearly outweigh any potential distortions of competition triggered by the state aid.

Background

Trans Adriatic Pipeline AG is a joint venture company registered in Switzerland. Its shareholders are BP (20%), SOCAR (20%), Snam (20%), Fluxys (19%), Enagás (16%) and Axpo (5%).

The Trans Adriatic Pipeline is recognised as a project of common interest (PCI) in the framework of the EU’s Trans-European Energy Infrastructure Guidelines. PCIs are aimed at helping create an integrated EU energy market and are essential for reaching the EU’s energy policy objectives of affordable, secure and sustainable energy.

The Commission published its first list of PCIs in 2013. The list is updated every two years to integrate newly needed projects or to remove obsolete ones. The current PCI list was approved on November 18, 2015.

The non-confidential version of the decision will be made available under the case number SA.43879 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

Revised ‘Greek Stream’ plan to be sought within 2016

Officials at Gazprom, Edison, and DEPA, Greece’s Public Gas Corporation have told energypress that they are now preparing a second step towards reviving the “Greek Stream” project – intended to supply Russian natural gas to Europe via the south – following last week’s signing of a memorandum of understanding (MOU) for the development of the stalled ITGI natural gas pipeline to link Greece and Italy and serve as a route for Russian gas supply to Europe through the Southern Corridor.

As part of the plan’s second stage, the officials will seek to determine a route passing through Bulgaria for the “Greek Stream” project.

Authorities closely involved with the project have noted that much will depend on how Russian-Turkish bilateral ties play out. Bulgarian territory is now being considered as an alternative for the Russian gas pipeline’s route as a result of the troubled ties between Russia and Turkey. Should these two countries resolve their differences, the Bulgarian alternative could be abandoned, but this seems highly unlikely at present.

A date for the next meeting between Gazprom, Edison, and DEPA officials has yet to be set. Technocrats will meet to focus on details such as natural gas quantities to be supplied through the pipeline, cost and financing issues that may ensure the project’s sustainability, as well as the  geographical route. The three companies want to have completed this part of the project’s task by the end of this year.

Besides the technocratic details, work also needs to be carried out at a diplomatic level to secure the European Commission’s backing of the Russian pipeline plan for Europe’s south. Gazprom, Edison, and DEPA officials will seek to secure the EU executive body’s official support for the project by the end of this year. This has already been unofficially granted, it is believed.

The age-old ITGI plan linking Greece and Italy was never carried out but this could now be developed and utilized as part of Russia’s latest plan for natural gas supply to Europe via the south.

ITGI route revived as DEPA, Gazprom, and Edison sign memorandum

A memorandum of understanding (MOU) for the development of a natural gas pipeline to link Greece and Italy and serve as a route for supply of Russian gas to Europe through the Southern Corridor was signed yesterday evening by the chief executives of Gazprom, Edison, and DEPA, Greece’s Public Gas Corporation – Alexey Miller, Marc Benayoun, and Theodoros Kitsakos, respectively.

The signing cermenomy took place in Rome following a meeting between Miller and Federica Guidi, Italy’s economic development minister.

The Greek Foreign Ministry’s Secretary General for International Economic Relations, Giorgos Tsipras, a cousin of Greek Prime Minister Alexis Tsipras, attended the signing ceremony.

The memorandum of understanding, indicating an intended common line of action, reflects the interest of all three sides to develop infrastructure that may carry Russian natural gas through the Black Sea, via transit countries, to Greece and then Italy.

The interested parties plan to utilize, to the greatest degree possible, work already completed by DEPA and Edison for the sidelined ITGI Poseidon project.

DEPA and Edison had originally established Poseidon as a joint venture in the previous decade to develop the ITGI pipeline, planned to carry Azeri natural gas from Turkey to Greece and then Italy, via a submarine crossing through the Adriatic Sea. However, the the plan was abandoned after Azerbaijan opted to develop the TAP (Trans-Adriatic Pipeline) project instead for this purpose.

“The revival of the ITGI Poseidon project reinforces Europe’s energy security with an additional supply route and upgrades Greece’s important role as a significant natural gas gateway, via diversified sources and routes,” remarked Kitsakos.

Sefcovic stresses Greece’s regional gas hub potential

Greece promises to play a crucial role in European natural gas supply as a result of current regional developments linked to the natural gas sector, Maros Sefcovic, the European Commission’s vice president, has pointed out in an interview with EurActiv.com.

Sefcovic, who said he is scheduled to visit Greece on March 10 as part of an Energy Union tour, pointed out that the country is set to play a vital gas transit role.

“The Southern Gas Corridor should bring the new Caspian gas to Europe before 2020, and this pipeline goes through Greek territory. We see very interesting developments in the Eastern Mediterranean, with gas fields discovered around Cyprus, close to Israel, and close to Egypt. Europe could become a destination of this gas, and again, Greece would play a very important role,” Sefcovic was quoted as telling EurActiv.com.

He added that details on the IGB interconnector between Bulgaria and Greece are currently being worked on amid a very positive climate.

“That would be a very important gateway for the new supplies which will be coming to Europe from the Caspian, but also from the Mediterranean, for shipping them north to Bulgaria and the western Balkan countries. These are, of course, projects we will discuss once in Greece,” Sefcovic noted. He added that, based on updates from Greece’s energy minister Panos Skourletis, the IGB will be built on time and Greece will be able to profit from its geographical location and become a crucial transit country for gas entering from at least two directions.

Asked to comment on the continued dominance of main power utility PPC in Greece’s electricity market, still a monopoly, according to the interviewer, Sefcovic responded: “I’m sure the current Greek government has so many issues to deal with. They have to focus based on their priorities.”

Existing gas infrastructure must be better utilized, M&M chief tells

Until now, Greece’s goal of becoming a regional gas hub has been based on the prospect of developing new infrastructure projects but, in actual fact, the most important objective should be to better utilize existing facilities such as the Revythoussa LNG terminal on the islet just off Athens, being utilized at a level of 15 percent, and also to create appropriate conditions for a liberalized market in which consumers may have access to the supplier of their choice, Panagiotis Kanellopoulos, chief executive of M&M Gas, a wholesale trading venture involving the Mytilineos Group and Motor Oil Hellas, has stressed at the Athens Energy Forum.

Kanellopoulos pointed out that although conditions provided by both Greece and DEFSA, the gas grid operator, are ready to fulfill consumer needs for importing natural gas through pipelines from the country’s northern borders, the needed legal infrastructure for such an initiative does not exist in Bulgaria. The official added that a small section of pipeline infrastructure linking Bulgaria with Romania has yet to be constructed, depriving the region from access to central European markets.

The market will determine which new infrastructure projects are truly needed and sustainable, the M&M Gas chief told the energy event.

Both the Greek and regional Balkan market are small, but clever ways need to be found to utilize the exisiting infrastructure and increase their usefulness, Kanellopoulos noted.

EU pushing IGB plan regardless of market test result

Bulgarian energy minister Temenuzhka Petkova’s recent assurance that construction of the IGB Greek-Bulgarian Interconnector gas pipeline will begin in October of this year and the project will be launched in the second half of 2018 certainly came as a surprise for certain authorities, given that the preliminary stage of a new market test being conducted, to check the project’s feasibility, has yet to be completed.

However, this declaration by the Bulgarian minister did not raised the eyebrows of officials closely following the IGB-related developments in Brussels. For them, it has become clear that the European Union wants the project to progress, and is making an additional effort to assure this is achieved. According to energypress sources, moves are being made for further EU financial backing of the project, which has already been classified as a Project of Common Interest (PCI), a status that guarantees EU funding.

According to some pundits, the IGB project will be developed even if the new market test does not produce favorable results. Ideally, a sufficient number of gas trading companies will commit themselves to a certain level of orders that would ensure the pipeline project’s sustainability. Even so, the market test stage, which follows the recent final investment decision agreed to by Greece and Bulgaria, is important, including symbolically.

The test’s first stage, entailing declarations of non-binding interest, will be completed on February 29. The second stage, to involve binding offers from traders, is expected to be finalized around April.

A first market test, conducted between May, 2013 and September, 2014, failed to produce satisfactory results. But the final investment decision was signed as a result of the major emphasis being placed by the EU on the project, which will reinforce the region’s energy security and break Russian gas supplier Gazprom’s dominance. The US has also heavily backed the project.

Based on preliminary estimates, the project’s budget is estimated at 240 million euros, of which 220 million euros concern construction costs, while its annual operating cost is estimated at 4.5 million euros. Signalling this infrastructure project’s importance, the European Commission has committed 45 million euros of furnding for the IGB’s development.

Poseidon SA, a venture formed by Italy’s Edison and DEPA, Greece’s Public Gas Corporation, holds a 50 percent stake in the consortium established to construct and operate the IGB pipeline. Bulgarian state-run company BEH holds the other 50 percent of the IGB consortium.

The IGB pipeline is planned to run from Komotini, in Greece’s northeast, to Stara Zagora in Bulgaria, for a total length of approximately 170 kilometers.

Gas pipelines at the core of Tsipras, Biden talks in Davos

Greece’s economic program, the refugee crisis, cooperation with the US, especially in investments and energy, the Cyprus problem, as well as the name dispute concerning the neighboring Former Yugoslav Republic of Macedonia (Fyrom) were all discussed at a meeting between Greek prime minister Alexis Tsipras and US vice president Joe Biden at the annual World Economic Forum, now taking place in Davos, Switzerland.

Recent agreements reached to pave the way for the development of the TAP (Trans Adriatic Pipeline) and IGB (Greece-Bulgaria Interconnector) natural gas pipeline projects were praised during the talks, while the potential to supply LNG to other parts of Europe via Greece was also discussed. Greece’s role as a prospective regional energy hub was also on the agenda.

The US vice president stressed that stability in Greece is crucially important for wider stability in Europe, according to a statement released by the Greek prime minister’s press office. Swift completion of the next review of Greece’s bailout program is necessary to help propel the country towards economic recovery, the two officials agreed, according to the statement.

Tsipras hailed initiatives taken by the US vice president for closer economic ties between Greece and the US as well as the latter’s promotion of US investments in Greece.

 

Energy ministry endorses TAP project’s local route

The TAP (Trans Adriatic Pipeline) project’s local segment, to run through northern Greece and cover thirteen regions, has been endorsed by the energy ministry, it announced.

The TAP pipeline, to supply Azeri natural gas to central Europe via Greece, Albania, and Italy, will cross through the Greek regions of Evros, Drama, Kavala, Xanthi, Rodopi, Imathia, Thessaloniki, Kilkis, Pella, Serres, Kastoria, Kozani, and Florina.

“The delivery of the Installation Act represents another important step in the development of the TAP natural gas pipeline, currently included in a catalogue listing the world’s ten most significant projects in progress,” the ministry statement noted.

The natural gas pipeline’s construction and operation promises numerous benefits for Greece, including an employment boost to be provided by both direct and indirect jobs linked to the project, estimated at roughly 10,000 in total; the involvement of Greek companies in the project’s construction; as well as local supply of equipment and building materials, the statement added.

The TAP project wll help diversify Europe’s natural gas supply sources and pipeline routes, considered crucial for energy security and sufficiency throughout the EU, including Greece, the ministry noted.

The project also promises to boost Greece’s geopolitical position, offering benefits for the national economy, and, as a result, contribute to the overall effort being made for the country’s economic recovery, the ministry statement added.

Bulgaria mulls doubling IGB capacity ahead of market test

The Bulgarian government is now envisioning the prospective IGB (Interconnector Greece Bulgaria) pipeline as a main gas supply route that may cover both its domestic needs as well as those of the neighboring markets of Romania, Serbia, the Former Yugoslav Republic of Macedonia (Fyrom), and even Ukraine, traditionally entirely dependent on Russian supply.

As a result, Bulgarian officials are examining the prospect of doubling the IGB pipeline’s annual capacity from five billion cubic meters – it will begin operating at three billion cubic meters before being increased to five billion cubic meters – to ten billion cubic meters.

The thoughts of increasing capacity precede the upcoming results of a new market test that will show the gas pipeline’s guaranteed consumer demand level, which will indicate whether the project is economically feasible. The market test result is due at the end of February. These early thoughts of a capacity increase indicate that Bulgarian officials see great potential in the IGB project.

The troubled biltareral ties between Russia and Ukraine and threat of a cut in the Russian supply route to Ukraine has increased the emphasis being placed on the role that may be played by the IGB pipeline in the wider region. Russia has announced it will cut supply to Ukraine in 2019.

If so, Bulgaria plans to make available gas supply running through the IGB pipeline, stemming from the TAP (Trans Adriatic Pipeline) project to carry Azeri natural gas to Europe, as well as US gas via the prospective LNG terminal in Alexandroupoli, northeastern Greece, and other sources, including the LNG terminal in Revythoussa, an islet in the Saronic Gulf, close to Athens.

The IGB project is expected to be completed in 2018. If the thoughts of Bulgarian officials to double its capacity are actualized then a capacity increase of the LNG terminal being planned by Gastrade for Alexandroupoli will certainly follow.

For the time being, a new market test needs to be completed following the recent final investment decision. A first test conducted between May, 2013 and September, 2014 failed to produce satisfactory results.

The project’s budget is estimated at 240 million euros, of which 220 million euros concern construction costs, while its annual operating cost is estimated at 4.5 million euros. Signalling this infrastructure project’s importance, the European Commission has committed 45 million euros of furnding for the IGB’s development.

Poseidon SA, a venture formed by Italy’s Edison and DEPA, Greece’s Public Gas Corporation, holds a 50 percent stake in the consortium established to construct and operate the IGB pipeline. Bulgarian state-run company BEH holds the other 50 percent of the IGB consortium.

The IGB pipeline will run from Komotini, in Greece’s northeast, to Stara Zagora in Bulgaria, for a total length of approximately 170 kilometers.

The main purpose of the IGB pipeline will be to break Bulgaria’s virtual full dependence on Russian natural gas supplied by Gazprom. US State Department officials have expressed great interest in the project’s development, as they have made clear on every recent official visit to Greece. A series of visits were made by US officials to the region last October and November. Amos Hochstein, the US Special Envoy and Coordinator for International Energy Affairs, prepared the ground for an ensuing visit by Secretary of State John Kerry. Also, Greek Prime Minister Alexis Tsipras was in New York City last September, where he met with Kerry.

Construction of the IGB project is scheduled to begin in the second half of this year and is expected to be ready to operate in the second half of 2018.

Regional trouble can endanger local gas supply sufficiency

Greece may face a difficult remaining winter season in terms of natural gas sufficiency if temperatures drop in the wider region as a result of Russia’s bilateral tensions with Turkey and Ukraine, both crucial supply routes.

In recent years, Botas, the Turkish state-run crude oil and gas company, has both severely limited and turned off the tap for gas supply to Kipous, northeastern Greece, when temperatures plunge so as to ensure the neighboring country’s domestic needs. These periods usually last a few days and Russia, until now, has typically stepped in with greater supply towards Turkey, helping normalize supply conditions in the region.

However, such back up from Russia is considered impossible at present considering the poor bilateral ties between Moscow and Ankara. Consequently, it remains unknown for how long Botas will stop supplying Greece if temperatures plunge to considerably boost natural gas consumption needs in the region.

Botas and DEPA, the Public Gas Corporation, have signed an agreement stating that non-delivery of contracted quantities may activate penalty-related clauses. If Turkey fails to comply, it will need to specify the reasons.

The situation could worsen for Greece if a halt from the Turkish-linked Kipous supply point coincides with the closure of taps at the northern entrance, in Bulgaria, the main supplier of Russian natural gas to Greece. Such a development cannot be ruled out if tensions between Russian and Ukraine, which affect Russian Gazprom’s supply to Ukraine’s Naftogaz, are not appeased.

Russia appears determined to not continue supplying natural gas to Ukraine if Kiev does not provide substantial deposit amounts, judging by public comments made by Russian officials. Ukraine’s alternative, to absorb natural gas from its western European neighbors, is not an unlimited option as these countries will not possess excess amounts to export if weather conditions worsen and their own needs increase.

The pipeline that carries Russian natural gas to the south for supply to the wider region, including Greece, and passes through Ukraine is different to the one facilitating Russian supply to Ukraine. If Russia closes the tap on Ukraine, as it has done in the past, then Ukraine, if faced by gas shortages of its own, will surely draw from the transit pipeline intended for the southern countries.

Local authorities, in comments offered to energypress, have confirmed that a combined supply problem from the east and north may threaten sufficiency levels in Greece. This would pose a threat to electricity generation as substantial local power amounts are produced at gas-fueled stations.

However, the crisis would need to persist for a prolonged period if it is to cause gas supply problems in Greece. The country’s LNG terminal in Revythoussa, an islet in the Saronic Gulf, close to Athens, is equipped to store increased amounts, which would offer crucial support.

 

 

New utility for grounded ‘Turkish Stream’ is unnecessary

A parliamentary committee responsible for public utilities is preparing to appoint the administration of DEPENE, a new public utility established by the government’s ex-energy minister Panagiotis Lafazanis in order to represent the Greek state in investments concerning construction and management of natural gas pipelines, other infrastructure, as well as participation in companies active in related fields.

Turkish Stream, Russia’s most recent natural gas pipeline proposal planned to run westward from the Greek-Turkish border area and across Greece, whose prospects are currently grounded, was a key factor behind the new public utility’s establishment. The formation of the utility now appears unnecessary.

At the time of DEPENE’s establishment, Lafazanis – the former energy minister who ended up quitting Syriza last summer to form his own anti-eurozone party, Popular Unity, which has not made Parliament – had declared the Russian gas pipeline would generate two billion euros of revenues for the Greek state and 20,000 new jobs.

Although such prospects appear to have all but vanished, his successor, energy minister Panos Skourletis, is determined to press on with the new utility, presumably so that the Greek state will be prepared should the Turkish Stream plan be revived.

Besides its possible role in Turkish Stream, DEPENE is soon expected to also acquire a wider role in Greece’s hydrocarbon interests, making it the second company to be established for this purpose following EDEY, the Greek Hydrocarbon Management Company, the difference between the two being that DEPENE will be able to participate as a shareholder in research and production investments for oil and gas.

It remains questionable how capable the Greek state is to take part in high-risk ventures amid the adverse market conditions and subdued hydrocarbon research and production activity, worldwide, as a result of fallen crude prices. Also, exploration and exploitation tenders that have either been completed or are in progress cannot be revised to create a role for DEPENE.

The parliamentary committee responsible for public utilities is scheduled to convene on January 8 to consider the proposals forwarded by Skourletis, the energy minister, for the administrative posts at DEPENE, to be run by a seven-member board.

Antonis Georgopoulos has been proposed for the chairman’s post, Eleni Zafiropoulou as his deputy, and Argyrios Argyriou as managing director.

 

Greek PM’s realpolitik helped pave the way towards IGB deal

The Syriza coalition’s more recent realpolitik approach to energy matters, a far cry from former energy minister Panos Lafazanis’s obsession focused on nurturing closer ties with Russia, helped pave the way towards yesterday’s deal struck between Greece and Bulgaria on a final investment plan for the construction of the IGB natural gas pipeline interconnector.

The US played a key intermediary role over the past couple of months, initially through the efforts of Amos Hochstein, the US Special Envoy and Coordinator for International Energy Affairs, who recently visited the region, followed by Secretary of State John Kerry, who was in Athens last week. Both visits had been preceded by Greek Prime Minister Alexis Tsipras’s trip to the US in September, where he and Kerry held talks.

Yesterday’s highly anticipated deal, one of strategic importance and much delay, was signed in Sofia by Bulgarian Energy Holding and Greece’s IGI Poseidon.

The project is scheduled to interconnect the grids of both nations in 2018, initially serving as a supply route for Azeri natural gas, to reach Europe via the Greek segment of TAP, the Transadriatic Pipeline, as well as a route for US shale gas exports to be transported to a prospective LNG terminal in Alexandroupoli, northeastern Greece, in the form of LNG, before being distributed in Greece and the wider region.

However, the project’s sustainability will need to be confirmed through a sufficient number of consumers committed to long-term gas contracts before construction of the IGB interconnector can begin.

The IGB project is being heavily backed by the US, which wants to weaken Russia’s energy-sector dominance in the wider region and penetrate the market with American shale gas exports. The EU is also supportive. It will offer 48 million euros for the construction of the project, classified as a Project of Common Interest (PCI).

Greece also stands to gain as development of the IGB, along with the TAP project – to run roughly westward through Azerbaijan, Turkey, Greece, Albania, and across to Italy – and the prospective LNG terminal in Alexandroupoli, will all combine to offer the country major financial and geostrategic benefits that could establish Greece as a European natural gas hub.

If the IGB’s sustainability is secured over the next few months, as is scheduled, construction will begin in the second half of 2016, while the pipeline will be ready to operate in the second half of 2018, according to Greek energy minister Panos Skourletis.

The IGB pipeline is planned to run 182 kilometers, from Komotini, northeastern Greece, to Stara Zagora in Bulgaria. Its initial capacity will measure three billion cubic meters, annually, while provisions will be made for a future increase to five billion cubic meters.

Greece interested in ‘European gateway role for Cypriot, Israeli gas’

Greece is interested in serving as a gateway for Cypriot and Israeli natural gas supply to Europe, either through tankers transporting supply from export stations operated by the two neighboring countries, as well as Egypt, or through a direct East Med submarine gas pipeline link, Greece’s energy minister Panos Skourletis noted in a written statement prepared for the 4th edition of the Energy Symposium in Cyprus. The minister’s note was read at the event by an official of the Greek Embassy in Cyprus.

Greek is striving to establish itself as an energy hub in southeast Europe and the east Mediterranean to contribute to the region’s energy security, the minister’s note added, while adding that heightened activity leading to this objective has been observed in the region lately.

Greece is seeking to play a central role as a regional hub, while the development of the IGB Greek-Bulgarian pipeline interconnection; the TAP (Trans Adriatic Pipeline), to supply Azeri natural gas to Europe via Greece; a prospective LNG terminal in Alexandroupoli, northeastern Greece; and Russia’s new gas pipeline proposal for the Southern Corridor, envisioned to run westward through northern Greece and across to Italy, are all  key components of the overall plan, the minister noted.

The minister’s note added that the East Med pipeline, to be comprised of a network of submarine and overland infrastructure offering a direct link for deposits in the southeast Mediterranean area with the European gas network via Greece, is another crucial element in the plan to establish Greece as a new regional energy hub.

Skourletis’s note highlighted that the discovery of natural gas deposits in the sea region between Cyrpus, Israel, and Egypt promises to alter the region’s geopolitical standing and establish a central role for Cyprus on the southeast Mediterranean’s energy map.

Utilization of Greece’s renewable energy potential could greatly contribute to the diversification of the country’s energy mix, and also offer energy security, and environmental protection, the minister’s note added.

The two-day event, whose theme this year was “Energy: Time for Decisions”, concluded yesterday.

 

 

Kerry expresses US support for TAP, IGB pipeline projects

US Secretary of State John Kerry, in Athens today for meetings with Greek Prime Minister Alexis Tsipras and the Foreign Minister Nikos Kotzias, reiterated Washington’s support for the TAP (Trans Adriatic Pipeline) and IGB natural gas pipeline projects during a joint news conference with Kotzias, his Greek peer.

The TAP pipeline will run through Greece to carry Azeri natural gas into Europe. The IGB gas pipeline will interconnect the Greek and Bulgarian systems.

The American diplomat made note of Greece’s rising role in European energy security, while stressing energy diversification represents a common objective for both the US and its European partners.

Kerry praised the resilience of the Greek people and declared the US is supporting Greece’s path towards economic recovery.

The US Secretary of State, who had met with the Greek prime minister prior to the news conference, noted Tsipras expressed a strong interest for foreign investments in Greece. Kerry promised to relay this message to the investment community abroad.

Kotzias, Greece’s Foreign Minister, spoke of the strong traditional ties shared between Greece and the USA, decribed Kerry as a very formidable Secretary of State, while adding that the Greek diaspora in the US serves as a bridge linking the two nations.

The Greek minister also acknowleged the helpful contribution offered by the US to Greece in the country’s negotiations with lenders.

The US is interested in supplying Europe with LNG shale gas. Greece and Croatia, among others, are planned to serve as distribution points in this initiative.

Work is underway to increase the capacity of Greece’s exisiting LNG terminal station in Revythoussa, an islet in the Saronic Gulf, close to Athens. The construction of a second Greek LNG station in Alexandroupoli is of even more crucial importance to the US supply plan for Europe. The facility would be connected to the IGB pipeline and, besides Greece, would supply American LNG to the Bulgarian market as well as other countries in the region, all currently heavily dependent on Russian gas.

 

EU must support gas infrastructure projects, energy minister tells peers

The EU’s energy union strategy needs to place emphasis on Projects of Common Interest (PCI) such as development of LNG stations in southeast Europe, the Southern Gas Corridor, for gas supply from the Caspian and Middle Eastern regions, the vertical route and interconnection projects with Bulgaria, Albania, and Italy, the country’s energy minister Panos Skourletis has told peers at an EU council meeting of energy ministers.

The benefits of energy union need to be spread to less interconnected areas, Skourletis noted, while also stressing natural gas deposits in the east Mediterranean must be utilized.

The Greek energy minister updated his fellow EU energy ministers on local developments concerning the TAP (Trans Adriatic Pipeline) and IGB (Greek-Bulgarian interconnector) projects.

Skourletis also met with the European Commissioner for Climate Action and Energy Miguel Arias Canete on the sidelines of the meeting, discussing the TAP and IGB developments.

Greece’s request for free carbon emission rights in electricity production, as a measure offering support to the recession-struck country, was also discussed by the two officials.

EU member states whose GDP measures less than 60 percent of the EU average are entitled to free CO2 emission rights.

PM: Greece, Israel can work closer on energy, tourism

Bilateral ties between Greece and Israel have been upgraded in recent years but potential still exists for further development of mutual interests in the sectors of tourism, energy and culture, Prime Minister Alexis Tsipras told a news conference in Jerusalem yesterday, the opening day of an official two-day visit to Israel, following a meeting with Israeli peer Benjamin Netanyahu.

Commenting on the bilateral energy prospects, Tsipras expressed interest in Israel’s natural gas export prospects. Tsipras noted Greek and Israeli energy sector authorities would continue working on mutual interests, while a three-way meeting would be arranged to also include the participation of Cypriot president Nikos Anastasiadis.

The Leviathan gas field, off the coast of Israel, is now set to be exploited, which could establish Israel as a major energy player in the Middle East.

Netanyahu, who took part in the joint news conference, made note of the deep friendship binding the two nations, while also expressing hope for a Greek economic recovery.

During their meeting, Tsipras and Netanyahu also discussed the turmoil in the Middle East, focusing on the dangers entailed in the spread of Islamist extremism as well as the need for an end to the Syrian civil war.

French ITGI backing revitalizes ‘Turkish Stream’ prospects

The Russian-Turkish natural gas pipeline plan envisioned to also cross through Greece, a possibility that seemed unrealistic just several months ago during the tenure of the country’s former energy minister, Panagiotis Lafazanis – an anti-eurozone advocate who went on to form his own radical leftist party – has now emerged as a solid prospect, as was noted by energy minister Panos Skourletis yesterday, for the first time. France’s lobbying in support of the project’s development has been pivotal to the apparent shift.

Most recently, the plan has received heavy French support, both political and corporate, through President Francois Hollande and EDF-Edison, respectively. French support has promoted developing the pipeline through EU territory, exclusively, from the Greek-Turkish border area, across northern Greece to the country’s west, where it could be linked to the neglected Greek-Italian ITGI pipeline. Development of the ITGI project, approved in the past by the European Commission, is now also being brought back into the picture as a result of the role it could play in connection with the Russian-Turkish pipeline.

A previous plan for the Russian-Turkish pipeline’s crossing into central Europe envisioned a vertical route cutting through the Balkans, from Greece, the Former Yugoslav Republic of Macedonia (Fyrom), Serbia, and Hungary.

The French corporate group EDF has lobbied hard in Brussels over the past few months, supporting  the change of plan favoring a route across northern Greece and over to Italy. EDF has stressed Italy will comprise part of the route, while also noting the endorsed yet forgotten ITGI plan, dating back to the previous decade, could finally be actualized.

Of course, Russia and Turkey will need to overcome certain differences if the project is to stand a chance of progressing. Russian sources believe the impasse is manageable, while Greek officials estimate the project can progress.

A visit by Gazprom’s CEO Alexey Miller to Milan for a meeting with Edison’s managing director Bruno Lescoeur one month ago injected new momentum into the Russian-Turkish pipeline’s prospects.

 

 

Natural gas prospects to top PM’s agenda for visit to Israel

Prime Minister Alexis Tsipras is scheduled to travel to Israel tomorrow with energy interests at the top of the official visit’s agenda ahead of a three-way meeting between the leaders of Greece, Cyprus and Israel.

Tsipras is expected to be joined by Foreign Minister Nikos Kotzias, Deputy Infrastructure, Transport and Networks Minister Hristos Spirtzis, State Minister Nikos Pappas, and government spokeswoman Olga Gerovasili.

The trip, to include the Greek Prime Minister’s first official visit to Jerusalem, tomorrow, and Ramallah on Thursday, will offer participating officials the opportunity to discuss latest developments concerning the utilization of deposits in the east Mediterranean and natural gas export plans.

Tsipras is scheduled to hold a meeting with Israel’s Prime Minister Benjamin Netanyahu in Jerusalem, while meetings have also been planned to take place with President Reuven Rivlin, the country’s energy minister, and the opposition leader.

The Greek team intends to be informed by Israeli officials on the country’s natural gas export plans as well as its views on the strategic partnership with Greece and Cyprus, based on the region’s latest energy developments, such as the discovery by Eni of the enormous Zohr offshore natural gas field in the Egyptian sector of the Mediterranean, as well as the BG Group’s 35 percent holding, announced today, of a Cypriot offshore area, Block 12, which includes the Aphrodite gas discovery.

Tsipras and Netanyahu are expected to confirm the positive bilateral ties countries developed between Greece and Israel over the past few years, while also making clear this path will continue with Syriza at Greece’s helm.

Israel is currently examining its natural gas export options, which include transport to Cyprus and export through East Med – a planned pipeline to be comprised of a network of submarine and overland infrastructure offering a direct link for deposits in the southeast Mediterranean area with the European gas network via Greece – or a new LNG station; transport to Turkey; and transport to Egypt followed by export through the country’s LNG stations. These options all have their pros and cons. Athens is following the developments and maintaining an interest to possibly play a role in one of these chains.

The BG Group’s holding in Aphrodite has reportedly increased the prospects of the third Egypt-linked option being chosen, as has also been confirmed by Nicosia.

Egypt’s possible role as a fourth member in the regional geopolitical partnership involving Greece, Cyprus, and Israel will also be discussed during the Greek delegation’s visit to Israel.

‘Greek Stream’ has political support, Russian deputy says

Russia’s latest proposal for a natural gas pipeline in southeast Europe, being refered to as both “Turkish Stream” and “Greek Stream” and envisioned to run from the Greek-Turkish border across northern Greece all the way to the country’s northwest, was extensively discussed last Friday in Athens during an official visit by Russian Deputy Prime Minister Arkady Dvorkovich and Greek Prime Minister Alexis Tsipras, while it was agreed for Greece’s energy minister Panos Skourletis to soon visit Moscow for further talks, Russian media has reported.

The visit by Dvorkovich preceded a Joint Ministerial Committee between Greece and Russia to be held in Sochi today and tomorrow.

Besides his talks with the Greek Prime Minister, the Russian deputy head also held talks with a series of other leading local officials, including Skourletis, Agricultural Development Minister Evangelos Apostolou, and TAIPED (State Privatization Fund) president Stergios Pitsiorlas, paving the way for negotiations between the two countries.

Dvorkovich told Russian daily Rossiyskaya Gazeta that it was agreed, last Friday in Athens, by both sides to “intensify the work of the Joint Ministerial Committee with the aim of finding practical solutions to exisiting problems in the fields of energy, transport, and agriculture,” while adding that Gazprom and Russian Railways will be involved.

The Russian deputy also said he requested additional information on Greek privatization tenders, adding this front would be further processed at the Joint Ministerial Committee, today and tomorrow.

Commenting on the prospects of developing “Turkish Stream” through Greek territory, Dvorkovich said the matter was discussed with the Greek Prime Minister and has political support.

According to Russian news agency Ria Novosti, Skourletis, Greece’s energy minister, will visit Moscow within the next few days for further talks with his Russian counterpart Alexander Novak.

TAP consortium, energy ministry strike pipeline deal

Negotiations between Greece’s Environment and Energy Ministry and the TAP (Trans Adriatic Pipeline) consortium have essentially been completed with the latter agreeing to improve its initial offer’s terms.

According to sources, the TAP consortium has agreed to roughly double the amount offered for various local projects along the pipeline’s route, as part of its corporate social responsibility program. Initially, the amount  offered ranged between 12 million and 16 million euros, but the consortium has now committed itself to providing 32 million euros.

Also, details concerning compensation packages to be offered by the TAP consortium to the Greek state for forest areas and public land required for the pipeline’s development have also been resolved and finalized.

The agreements reached for all these issues, as well as another overcoming local environmental concerns, essentially pave the way for construction work on the TAP project to commence.

The TAP pipeline will run across nothern Greece, through Albania, and reach Italy via the Adriatic Sea to supply Azeri natural gas to central Europe.

 

 

‘Turkish Stream’ not good as ‘Greece would become a gas hub’

Development of Russia’s latest pipeline proposal for southeast Europe, dubbed “Turkish Stream” and envisaged to run from the Greek-Turkish border area across northern Greece for a link with Italy would establish Greece into a gas hub and this would not be in the interests of Turkey, Volkan Ozdemir, chairman at EPPEN, the neighboring country’s Institute for Energy Markets and Policies, contended during a speech at an Athens conference organized by IENE, the Institute of Energy for South-East Europe.

Although the project would offer Turkey certain benefits as a transit country, it would rival TANAP, the Trans Anatolian Natural Gas Pipeline, and is therefore not seen as a particularly attractive prospect in Turkey, Ozdemir noted. Negotiations between Russia and Turkey on the “Turkish Stream” proposal have stagnated.

While making note of the importance of the “energy triangle” comprised of the EU, Russia, and Turkey, Ozdemir highlighted his country’s geopolitical significance, saying the country links energy consuming countries with producing countries. This alone establishes Turkey as hub in the wider region, the Turkish official noted. However, he admitted Turkey is highly dependent on Russia and Iran as its main energy suppliers.

Commenting on Turkey’s gas market, Ozdemir said Botas, Turkey’s state-owned crude oil and natural gas pipelines and trading company, may control an 80 percent share of the country’s supply market, but a further eight private companies share the gas market’s other 20 percent.

Progressive national energy strategy needed, ex-minister notes

The country needs to pursue a progressive, open-minded national energy strategy with a European direction, Yiannis Maniatis, Greece’s former energy minister, who held the portfolio in the pre-Syriza coalition, has told an Athens conference organized by IENE, the Institute of Energy for South-East Europe.

Major energy-sector initiatives taken, at bilateral levels, by the previous coalition, which was led by the conservative New Democracy party, concerning projects such as the IGB (Greek-Bulgarian interconnector), the Vertical Corridor, and East Med, to offer a direct link for gas deposits in the southeast Mediterranean area with the European gas network via Greece, need to be continued, Maniatis told the conference.