Turkey tensions will not be escalated, ‘aim achieved’

Turkey will not continue intensifying its provocations in the East Mediterranean as the neighboring country has already achieved its main goal, a State Department declaration noting that the country is performing hydrocarbon exploration activities in disputed territory, Dr Konstantinos Nikolaou, a seasoned petroleum geologist and energy economist, supports.

Turkey’s provocations over the past few days – the country sent a seismic survey vessel into Greek EEZ waters for further exploration work following such initiatives in the past – represent part of a carefully planned strategy whose aim is to end Turkey’s East Mediterranean isolation of recent years and put the country back in the frame of the region’s hydrocarbon developments, experts believe.

Turkey has refused to sign the UN’s International Law of the Sea treaty, strongly disagreeing with Article 121, giving EEZ and continental shelf rights to island areas.

Instead, the country has followed its own rules, adjusting them as it pleases, to avoid giving any rights to island areas.

Besides seeking to reinforce the country’s position that rejects any EEZ rights for islands, the latest Turkish moves also aim to cancel EEZ agreements signed by Cyprus with Egypt, Israel and Lebanon.

Turkey has unsuccessfully sought to sign an EEZ agreement with Egypt, during Muslim Brotherhood times.

Dr. Nikolaou predicts that there will be no Turkish movement south of Crete as the transfer of an area by Libya, Turkey’s regional partner, would be required. The area of Benghazi is not controlled by Fayez al-Sarraj, the head of Libya’s UN-recognized government, but by renegade commander Khalifa Haftar.

Ultimately, the Turkish strategy in the wider region is aiming for co-exploitation of hydrocarbon deposits that may be discovered.

Chevron buys Noble Energy, US striving for regional control

Energy corporation Chevron has become the latest American giant, following ExxonMobil, to establish itself in the east Mediterranean upstream market following a five billion-dollar acquisition of Noble Energy, a deal that adds the gigantic Leviathan gas field in Israel’s EEZ to the California-based buyer’s portfolio and elevates the petroleum group into a dominant regional player.

This latest development highlights America’s strategy for the region, aiming to establish US control of production at new gas fields as well as supply to Europe, analysts noted.

Chevron’s acquisition of Noble Energy, highlighting the upstream industry’s elevated interest in the east Mediterranean, comes amid increased regional tension prompted by Turkish provocation. Greece’s neighbor has just sent a seismic survey vessel into Greek waters for hydrocarbon exploration activities.

Besides the Leviathan gas field’s recoverable reserves, estimated at 22 trillion cubic feet, the Chevron portfolio now also takes on Israel’s Tamar field, whose gas reserves are estimated at 7.1 trillion cubic feet.

Noble has proved reserves of 2.05 billion barrels of oil and gas to add to Chevron’s reported 11.4 billion.

Chevron, whose earnings in 2019 reached 139.9 billion euros, also adds to its assets, totaling 237.4 billion dollars, the Aphrodite gas field, situated within the Cypriot EEZ and estimated to hold 4.5 trillion cubic feet. Noble Energy is among this field’s operators.

Chevron’s control of the Leviathan gas field also secures American influence over the EastMed gas pipeline planned by Israel, Cyprus and Greece.

Fellow American petroleum giant ExxonMobil recently discovered, within the Cypriot EEZ, the Glafkos gas field, estimated to carry between 5 and 8 trillion cubic feet of gas. ExxonMobil has also taken on major licenses in Egypt and is also a member of a consortium formed with France’s Total and Hellenic Petroleum (ELPE) for licenses at offshore blocks west and southwest of Crete.

 

US wants Greece as partner for pumped storage projects

Recognizing the importance of pumped storage hydropower technology as a means for energy storage, the US is promoting the establishment of a related international forum to bring together countries and companies for co-development of such projects.

According to sources, Greek deputy energy minister Gerassimos Thomas has received an invitation from the US department of energy and the International Hydropower Association requesting Greece’s participation in a US-headed multidisciplinary platform that will seek to reinforce the role of pumped-storage technology in current and future energy systems.

Pumped storage hydropower supply during the pandemic has provided vital energy support for US households, hospitals and schools, American experts have determined.

Washington believes pumped storage hydropower projects are capable of enhancing the reliability of grids and supporting further renewable energy penetration. This technology, regarded as tried and tested, can be further developed in the energy transition era, US experts support.

Pumped storage hydropower currently represents about 94 percent of global energy storage capacity, latest data has shown.

A pumped storage hydropower project planned by Greece’s GEK TERNA in Amfilohia, western Greece, is regarded as a pioneering initiative in Europe.

The country’s energy ministry has approached the European Commission for special funding support for this project, budgeted at over 500 million euros.

 

US backs Greece’s east Mediterranean activities, major projects

All countries in the east Mediterranean region must carry out their activities in accordance with international law, including the International Law of the Sea as stipulated by the 1982 United Nations Convention on the Law of the Sea, the Greek and US governments have jointly announced following a high-level virtual conference held yesterday on energy issues.

This statement clearly offers US support for the positions of Greece, facing Turkish provocation.

The working group’s participating Greek and US officials reiterated the commitment of the two countries to cooperate on the effort to diversify energy sources in southeast Europe, collaborate with regional partners for energy source development, and promote regional energy security.

The latest energy working group builds on steadily growing bilateral cooperation following Greek-US strategic dialogue meetings in December, 2018 and October, 2019, the joint announcement added.

The Greek team was represented by the Ministry of Foreign Affairs’ Deputy Minister for Economic Diplomacy and Openness Kostas Frangogiannis and Deputy Environment and Energy Minister Gerassimos Thomas (photo). The US team was represented by Assistant Secretary of State for Energy Resources Francis Fannon and Under Secretary of Energy Mark Menezes.

Fannon, the Assistant Secretary of State, expressed satisfaction on the completion of the Greek segment of the TAP gas pipeline project, to carry Azeri gas to Europe.

The US official also offered support for the ongoing construction of the Greek-Bulgarian IGB gas pipeline interconnection and the progress achieved in plans for an FSRU in Alexandroupoli, northeastern Greece, a South Kavala underground gas storage facility, and Greek-North Macedonian connection.

Poseidon overland section plan kept alive, PCI status sought

IGI Poseidon, a 50-50 joint venture between Greek gas utility DEPA and Italian energy operator Edison, is keeping alive the development prospects of an overland Greek segment, across northern Greece, for its Poseidon pipeline, to cross the Ionian Sea for a Greek-Italian link.

DEPA and Edison have submitted an application to the European Commission for PCI status concerning the overland section of Poseidon, enabling EU funding support, sources informed.

The Poseidon pipeline’s onshore segment, planned to stretch 760 km across northern Greece, from Kipous in the northeast, to Florovouni-Thesprotia, in the country’s northwest, before crossing the Ionian Sea all the way to Otranto, on Italy’s east coast, is considered an extension of the EastMed gas pipeline plan to link Greece, Cyprus and Israel.

Poseidon’s onshore segment could be used to transport natural gas from east Mediterranean gas reserves to Balkan markets.

The Poseidon pipeline’s overland section can also be expected to be linked to the Greek-Bulgarian IGB gas pipeline, another project involving IGI Poseidon.

The Greek-Italian Poseidon pipeline has been incorporated into a trilateral agreement signed by Greece, Cyprus and Israel for the EastMed pipeline. This pact was ratified in Greek Parliament last month.

Greece, Cyprus and Israel recognize the overland section of the Poseidon pipeline as a project of national significance.

Capacity of the Poseidon pipeline has been increased to 15 bcm from an original capacity of 8 bcm, while a further capacity boost to 20 bcm is planned.

 

Turkish-Libyan MoU ‘ignores’ International Law of the Sea

A Turkish-Libyan Memorandum of Understanding emphatically ignores article 121 of the International Law of the Sea (UNCLOS 1982), which recognizes Exclusive Economic Zone and continental shelf rights for island areas, and overlooks the existence of Crete, Karpathos, Kasos, Rhodes and Kastellorizo to carve out approximately 39,000 square kilometers of Greek territory south of Crete for Libya, petroleum geologist and energy economist Dr. Konstantinos Nikolaou, a former member of the board at the Cyprus Hydrocarbons Company, has pointed out in an analysis, spelling out the dangers of Turkey’s provocative behavior in the region.

Turkey misappropriates the continental shelf and EEZ associated with Crete, Karpathos, Kasos, Rhodes and Kastellorizo in the east Mediterranean, he noted on the MoU, submitted by Turkey to the UN in an effort to make gains at Greece’s expense.

Hydrocarbon licenses for plots south and southwest of Crete that have been awarded by the Greek State to Total, ExxonMobil and ELPE (Hellenic Petroleum) and published in the Official Journal of the European Union, set a precedent that backs the positions of Greece, whose division of the area is based on International Law of the Sea guidelines, Nikolaou highlighted.

Turkey is using its state-run petroleum corporation TPAO as a tool to exercise foreign policy for territorial gains, Nikolaou added.

Natural gas discoveries in the east Mediterranean serve as a major driving force behind the actions of Turkey, whose energy sector is import-dependent, he pointed out.

Electric vehicles bill to include production line incentives

A draft bill being prepared by the government to promote growth for Greece’s embryonic electric vehicle sector will not only include incentives for buyers and users but also producers, energypress has been informed.

Producers establishing production lines for electric vehicle parts, including batteries, transformers and recharging units, will be offered incentives in the form of lower tax rates and reduced social security system contributions for employees, the sources said.

However, eligibility for these incentives will be conditional and require producers to establish their production facilities in either northern Greece’s west Macedonia region or Megalopoli in the Peloponnese, both lignite-dependent local economies headed for decarbonization.

The incentives are expected to include subsidies of between 4,500 and 5,000 euros for purchases of zero or low-emission electric cars, approximately 1,000 euros for electric scooters and 800 euros for electric bicycles.

Government officials plan to submit the draft bill on electric vehicles to Parliament in June.

Besides seeking to promote industrial development in current lignite areas, the master plan will also aim to make the most of early interest expressed by foreign investors.

One of these, Tesla, has, for months now, expressed interest to the Greek government for development of a fast-recharge network at Greece’s highways, a project budgeted at 10 million euros. This project is envisioned as part of a wider plan stretching from Portugal to Spain, France, Italy, Greece and Turkey.

Greece, Cyprus, Israel, with US, plan for EastMed meeting next month

The energy ministers of Greece, Cyprus and Israel plan to stage a trilateral meeting next month, with US involvement, for talks on the prospective EastMed gas pipeline, to transport gas from Israeli and Cypriot fields to Europe via Greece and Italy.

It remains uknown if Francis Fanon, the US Assistant Secretary of State and head of the country’s energy portfolio, will participate at this meeting.

It also remains unclear if participants will stage a virtual conference as a result of pandemic measures or meet in person.

The Greek, Cypriot and US governments were waiting for the new Israeli government to be sworn in before shaping plans for the EastMed meeting, to also serve as a second energy conference between the four nations following an inaugural session in Athens last August.

Yuval Steinitz has been reappointed at Israel’s top energy post, meaning the line-up of last year’s session between the Greek, Cypriot and Israeli energy ministers can be repeated at the next meeting. Greece’s Costis Hatzidakis and Cyprus’ Giorgos Lakkotrypis are still at their posts.

The Greek, Cypriot and Israeli government officials are expected to reaffirm the commitment of their respective countries to the EastMed gas pipeline, as well as commitment to cooperation for regional peace and prosperity, sources said.

Also, the energy ministers of Greece, Cyprus and Israel, along with the session’s US representative, will seek to send Turkey a unified message on its provocative actions against Greece as well as increased aggression in the wider southeast Mediterranean region.

A trilateral EastMed gas pipeline agreement was approved in Greek Parliament last January.

Israel could soon reach a decision on the financing of some of the studies needed for the international pipeline’s link to the national grid.

Also, IGI Poseidon, a consortium comprising Greek gas utility DEPA and Italy’s Edison, is moving ahead with studies for the pipeline’s underwater and overland route between Greece and Italy. IGI Poseidon wants to make an investment decision on this project within the next two years. Meanwhile, Cyprus is making progress on licensing matters.

Oil drilling plans on hold, forced by price collapse, pandemic

Preliminary hydrocarbon exploration work planned by oil companies at licenses in the Ionian Sea and south of Crete is being postponed for an indefinite period that could last as much as a year, possibly more.

Upstream players are revising plans as a result of the collapse in oil prices and the coronavirus pandemic, a double setback for the sector.

Worse still, investment conditions for the Ionian Sea and Crete areas are made even more challenging by the fact that neither has yet to reveal sustainable fields.

In addition, both Greek zones are deep-sea areas of depths ranging from 2,500 to 3,000 meters, making exploration a high-cost venture.

Global oil majors are reducing investments and expenses by the billions in response to the unfavorable market conditions that have emerged over the past couple of months.

Fields with proven reserves have not been spared, which pushes untested fields such as those in Greece even further down the priority list.

The resumption of drilling ventures still at preliminary stages is not likely until oil prices rebound, energy minister Costis Hatzidakis noted in an interview with Greek daily To Ethnos.

It is a similar picture for Cyprus. The Eni-Total consortium yesterday announced it is postponing oil drilling activities in Cyprus’ Exclusive Economic Zone until March or April next year.

DEPA signs EIB loan agreement to build LNG supply tanker

Gas utility DEPA has signed a loan agreement with the European Investment Bank for the construction of an LNG supply tanker with a 3,000 cubic-meter capacity, sources have informed.

This loan agreement follows a funding agreement reached between DEPA and the Innovation and Networks Executive Agency (INEA) for EU co-financing – through the new BlueHUBS program – of the LNG tanker to be built by the utility.

Planned to adopt new environmentally friendly shipping fuels,  the LNG tanker promises to be the first of its kind in Greece and the east Mediterranean. It will be designed to meet LNG supply needs at Piraeus port and also transport LNG to other major ports around the country.

DEPA, a wide supporter of LNG usage in shipping, is coordinating the BlueHUBS program (2019-2022), aiming for the development of LNG supply carriers.

Jointly supported by Greece and Cyprus, BlueHUBS represents the continuation of the Poseidon Med II program and has a total budget of approximately 66 million euros, of which 30 percent is being provided by the EU.

Colossal task ahead for decarbonization goal

Greece faces a colossal task – in terms of money needed, level of complexity and coordination – to reach ambitious post-lignite objectives set by the government.

The effort could require as much as 4.4 billion euros in EU funds, deputy energy minister Gerassimos Thomas noted yesterday, plus many more billions from the private sector.

Greece is entitled to a considerable sum in EU funds for the country’s decarbonization effort but, as a first step, a cohesive master plan will need to be submitted to Brussels. It will then need to be executed. The plan’s rate of execution will depend on the country’s ability to absorb EU funds made available.

An inter-ministerial committee involving seven ministers and deputies and established to oversee the entire effort will stage its inaugural meeting today.

A collective effort will need to be made involving teamwork of at least five ministries (finance, environment & energy, development, interior and agricultural development), two regional authorities (west Macedonia and Peloponnese), and no less than four municipalities (Florina, Kozani, Amynteo and Megalopoli). The local economies of these regions are lignite-dependent at present.

A national action plan must now be swiftly prepared. Its specific project proposals will then need to be tabled to the European Commission for approval before any investment activity can commence.

Personnel retraining, heightened research activity and development of new technologies are other necessities.

 

East Med pipeline to upgrade geostrategic role of participants

The EastMed Pipeline Agreement, a trilateral deal signed by the energy ministers of Greece, Cyprus and Israel in Athens yesterday with the leaders of all three countries in attendance, includes provisions for measures to protect and safeguard the pipeline project, sources have informed.

Other details in the agreement, fundamental to the region’s energy developments, include a regulatory and licensing framework facilitating the project’s development, common tax rules, as well as terms enabling the entry of new members and transmission of additional natural gas quantities from existing or new gas fields, including south of Crete, should any new deposits be discovered in the region.

The agreement upgrades the geostrategic roles of Greece and Cyprus and is a crowning achievement for the three-way cooperation established between the two countries and Israel, noted Greek Prime Minister Kyriakos Mitsotakis.

The 2,000-km pipeline is planned to carry between 10 to 20 billion cubic meters of natural gas to Europe via the three countries and Italy.

Addressing the heightened Turkish provocation of late, the Greek leader noted that the pipeline does not pose a threat for any side, adding regional cooperation is open for all provided rules of good neighborliness and international law are respected.

Following up on the recent commencement of production at the Leviathan gas field off the coast of Israel, the EastMed Pipeline Agreement establishes Israel as a key energy player in the region, stressed Israeli Prime Minister Benjamin Netanyahu.

The project promises to offer major collective benefit for the three countries involved as well as the wider region, noted Cypriot President Nicos Anastasiades.

Earlier yesterday, Greek gas utility DEPA and Energean Oil & Gas, active in the wider Mediterranean region, signed a Letter of Intent at the energy ministry through which DEPA will be able to purchase natural gas quantities from Energean, extracting at Israeli gas field licenses.

DEPA, in a company announcement, described the Letter of Intent as a major first step for the East Med project’s commercial viability.

Trilateral East Med agreement set to be signed in Athens today

The energy ministers of Greece, Cyprus and Israel are set to sign a trilateral agreement in Athens this afternoon for the development of East Med, a natural gas pipeline to carry gas to Europe via the three countries and Italy.

The pipeline, planned to measure 2,000 km and offer a capacity ranging between 10 to 20 billion cubic meters, promises to reinforce the Greek-Cypriot-Israeli alliance amid times of heightened Turkish provocation in the region.

Italian economic development minister Stefano Patuanelli, responsible for the country’s energy portfolio, has forwarded a letter of support for the project to Greek energy minister Costis Hatzidakis.

The Greek minister will sign the East Med agreement today with Giorgos Lakkotrypis and Yuval Steinitz, his Cypriot and Israeli counterparts, respectively. Italy is also expected to eventually join the partnership for this project.

Just hours before this signing ceremony, planned for 15:45, Greek gas utility DEPA and Energean Oil & Gas, active in the wider Mediterranean region, will sign a Letter of Intent at the energy ministry.

Importantly, this agreement promises to pave the way for a first commercial agreement reserving natural gas quantities ahead of the East Med pipeline’s construction, as DEPA will commit to purchasing natural gas quantities from Energean, extracting at Israeli gas field licenses. These quantities will represent approximately 20 percent of the East Med pipeline’s initial capacity.

The development prospects of East Med were recently propelled by a decision from IGI Poseidon, a 50-50 joint venture involving DEPA and Italy’s Edison, to accelerate the completion of all pending issues needed for the project’s maturity.

An upcoming East Med Gas Forum, to take place in Cairo January 15 and 16 with participation from the energy ministers of Greece, Cyprus, Israel, Egypt, Jordan and the Palestinian Authority, should help add further dimension to the alliance.

The East Med pipeline, planned as a complementary route to other projects in the wider region, stands as the most mature component of an EU plan entailing the development of an energy corridor to connect new energy sources in the east Mediterranean with European markets, including the southeast European market.

 

East Med, IGB, Alexandroupoli FSRU upgrading Greek role

Three major energy projects of international dimension, the East Med and IGB natural gas pipelines, as well as the Alexandroupoli FSRU (Floating Storage Regasification Unit), all once seeming distant prospects, are now gradually turning into a close reality.

Their development promise to transform Greece into an energy hub and upgrade the country’s geopolitical standing in the fragile southeast Mediterranean and Balkan regions.

The leaders of Greece, Cyprus and Israel are set to sign a trilateral agreement for East Med, to carry natural gas to Europe via these countries and Italy, at a meeting in Athens on January 2. The transmission capacity of this project, measuring 2,000 km, will range between 10 to 20 billion cubic meters. Italy is also expected to eventually join the partnership for this project.

Its development prospects have been further propelled by a decision from Poseidon, a 50-50 joint venture involving Greek gas utility DEPA and Italy’s Edison, to accelerate the completion of all pending issues needed for the project’s maturity.

The trilateral agreement promises to further bolster ties between Greece, Cyprus and Israel amid a period of heightened regional intensity. Turkish provocation has escalated. An East Med Gas Forum to take place in Cairo January 15 and 16 with participation from the energy ministers of Greece, Cyprus, Israel, Egypt, Jordan and the Palestinian Authority should help expand the alliance.

The Greek-Bulgarian IGB gas pipeline is expected to have begun operating far sooner, in July, 2021. DEPA holds a 25 percent stake in ICGB, the consortium overseeing the IGB project, whose initial capacity will be 3 bcm. Through this pipeline, DEPA plans to supply the Bulgarian market with Azeri gas hailing from the TAP route, and, as a result, break, for the first time, the existing Russian monopoly in the neighboring market.

The IGB will not only be fed by TAP, running westwards across northern Greece for Azeri supply to Europe. The Alexandroupoli FSRU to be anchored off coastal Alexandroupoli, northeastern Greece, will also feed the IGB, enabling an alternative gas supply source for Bulgaria, other east European countries, and Ukraine.

DEPA is also involved in this project. The gas utility has just decided to acquire a 20 percent stake in Gastrade, the company developing the FSRU project in Alexandroupoli.

Leading Washington officials have expressed their support for the East Med, IGB and Alexandroupoli FSRU projects. Prime Minister Kyriakos Mitsotakis will be seeking confirmation of this backing on an upcoming official trip to the US from President Donald Trump himself.

 

DEPA, Edison firm on East Med amid Turkish provocation

Italy’s Edison, part of the Poseidon consortium formed with Greek gas utility DEPA for the development of the East Med gas pipeline – planned to transport natural gas from Israeli and Cypriot fields to the EU via Greece and Italy – has decided to accelerate pre-construction procedures following escalating provocation from Turkey, energypress has reported.

A decision was reached at a recent Poseidon meeting in Milan to assign all needed project studies, financially backed by the EU, within the next two months for swifter completion of preliminary procedures, and, by extension, the project itself, a 2,000-km pipeline.

Greece’s energy minister Costis Hatzidakis and his Israeli counterpart Yuval Steinitz reiterated their support for the project at a recent meeting.

Turkey, seeking to block the project, recently reached a maritime border agreement with Libya, which EU leaders are set to reject as invalid, insisting the pact interferes with the rights of other countries bordering the Mediterranean Sea.

Cypriot Foreign Minister Nikos Hristodoulidis has received reassurances from Israeli government officials that the country is not involved in talks with Ankara for the development of an alternative gas pipeline, according to a Cypriot newspaper report. Israel remains committed to the East Med plan, it added.

DEPA’s Poseidon stake will be transferred to the Greek gas utility’s division for international projects. DEPA is being split ahead of its upcoming privatization.

Local retail electricity prices register EU’s 4th biggest dip

Retail electricity prices in Greece registered the EU’s fourth largest reduction in the first half of 2019, compared to the equivalent period a year earlier, falling by 1.3 percent, latest Eurostat data has shown, primarily as a result of more aggressive discount policies by independent suppliers for households and enterprises.

Denmark was ranked first with a 4.3 percent price fall, followed by Portugal with a 4.1 percent drop, and Poland, where retail electricity prices slid 3.1 percent.

The average EU price rose by one cent. The Netherlands posted the biggest price increase, averaging 20.3 percent. Cyprus followed with a 16.4 percent increase, Lithuania was next on the list with an average price hike of 14.4 percent and the Czech Republic was fourth with a 12 percent price increase.

Retail electricity prices in the Greek market are among the EU-28’s lowest, the Eurostat data showed. Greece was ranked 18th in this category with an average tariff price per KWh of 0.16 euro. Germany is the most expensive with an average tariff price per KWh of 0.30 euro. The EU average is 0.21 euro and the Eurozone average 0.22 euro, according to the Eurostat data.

Despite the more aggressive pricing policies of independent suppliers in Greece, power utility PPC maintained its dominant position with a retail market share ranging between 77 and 80 percent during the first half. PPC not only avoided dropping its prices but reduced a punctuality discount offered to customers paying their electricity bills on time.

Electricity prices in Greece and other EU member states could have been lower if it were not for the considerably sized surcharges and taxes added to electricity bills, Eurostat noted. Over one-third of total electricity costs go to state coffers and electricity transmission and distribution network operators, Eurostat added.

ENTSO-E: Greece in good position to meet energy demands this winter

Greece is in a good position to meet its energy demands this coming winter, even under unfavorable conditions, without import needs for most of the season, ENTSO-E, the European Network of Transmission System Operators for Electricity, has noted in its annual report.

The second half of December and January will be the most crucial period, the report noted, adding that RES curtailment is not expected to be needed in Greece.

Overall, the EU is ready to meet the winter’s energy demands, barring extraordinary conditions, according to the ENTSO-E report.

Temperatures 10 degrees Celsius below normal levels, combined with unanticipated capacity losses and low RES output, would create problems in Belgium and France in January, the report forecast. If so, these member states will need to depend on energy imports and possibly need to take emergency measures, it added.

LNG bunkering network for key Greek ports discussed in Rome

The development of an LNG bunkering network covering Greece’s main ports is one of the features included in a Greek-Italian Memorandum of Cooperation signed yesterday in Rome.

Italian officials, driven by increased LNG usage, internationally, proposed the development of LNG bunkering stations at major Greek ports during Prime Minister Kyriakos Mitsotakis’ visit to the neighboring country. The Greek leader was joined by energy deputy Gerassimos Thomas.

Discussion on the development of an LNG bunkering network in Greece goes back a number of years, steered by an EU directive from 2012 focused on the use of cleaner shipping fuel.

Unlike Italian ports, Greece’s ports have lagged behind in this department. In Italy, Edison has pushed ahead with many such investments, big and small-scale.

The objective, in Greece, is to develop a network to cover 15 percent of bunkering needs over the next decade and 25 percent by 2050. Italian know-how would provide valuable support.

Italgas, Italy’s biggest natural gas distributor, has displayed an interest in bidding for DEPA Infrastructure, one of two new gas utility DEPA entities emerging for the gas company’s upcoming privatization.

In a lesser-known development, Greece has received a proposal concerning the use of Italian gas storage facilities, for a fee, until an underground offshore facility south of Kavala is developed to bolster the country’s energy security, according to sources.

The Greek-Italian collaboration plan includes an upgrade of the existing submarine electricity grid interconnection linking the two countries. This line has been plagued by technical problems over recent years, often shutting down for repair work.

Energean submits applications to import, supply gas to Cyprus

Energean Oil & Gas, the oil and gas producer focused on the Mediterranean, has submitted applications to Cypriot authorities for import and supply of natural gas to Cyprus commencing 2021, the company has announced.

The submission of the applications follows the ‘Karish to Cyprus Preliminary Pipeline Development Plan’ that has already been presented to the Cyprus Energy Regulatory Authority, according to which, natural gas will be transported through pipelines from the Karish offshore block to the “Energean Power” Floating Production, Storage and Offloading unit, and from there through a pipeline to Vassiliko, Cyprus, where it will landfall.

The pipeline from the Energean Power FPSO to Vassiliko will have a total length of 215 kilometres and transport natural gas from the Karish North field, offshore Israel, which contains 25 BCM of discovered recoverable resources. Total investment will be circa $350 million and will be funded by Energean.

The Republic of Cyprus will bear no upfront cost. Provided that there will be no delays in permitting procedures, the project will allow the Republic of Cyprus to receive competitively priced natural gas from 2021.

Moreover, the project will further strengthen Cyprus’ geostrategic role in the Eastern Mediterranean, in accordance with the trilateral cooperation between Cyprus, Israel and Greece and in reference to the East Med Pipeline project that is planned to transport natural gas to Europe.

Mathios Rigas, CEO of Energean, stated:

“Energean’s proposal offers the Republic of Cyprus the option to switch to natural gas as soon as possible, and under the most competitive terms. Execution of the proposal will bring competition to the Cypriot natural gas market, decrease energy costs across the economy and result in enhanced diversity and security of supply. Our proposal enhances the planning of the Republic of Cyprus and the security of supply, as it is supplementary to the LNG import procedures launched by the Cypriot Government.

We expect that the Republic of Cyprus will take advantage of the options that the market offers for the benefit of the Cypriot economy and the consumers”.

Energean has already signed Letters of Intent (LOIs) with all three IPPs that have been granted a license to construct combined cycle power plants in Cyprus – Power Energy Cyprus, Lysarea Energia and Paramount Energy Corporation.

The Energean Power FPSO has a capacity of 8BCM per year and Energean has already signed firm GSPAs with Israeli IPPs and industrial consumers for 4.5 BCM per year for an average period of 16 years as of 2021.

 

North Macedonia seeking bilateral gas interconnection agreement

The North Macedonian government, unperturbed by its recent setback for EU accession talks, is moving to establish a bilateral agreement with Greece for the development of a natural gas pipeline interconnection linking the two countries.

North Macedonia’s dampened EU membership aspirations emerged as an unfavorable development for the project, which has remained stagnant.

A handful of EU member states, led by France, recently blocked North Macedonia, as well as Albania, from starting EU membership talks.

The North Macedonian government has approved a proposal for the commencement of negotiations with Greece that would lead to a bilateral agreement for this gas interconnection project.

The interconnection’s pipeline would run 80 km from Gevgelija to Negotino on the North Macedonian side and approximately 60 km on the Greek side, according to a project location deemed appropriate by North Macedonian officials, Greek diplomats have informed Athens.

 

 

Enel wants to invest in energy storage if framework is right

Italy’s Enel Green Power is interested in proceeding with further investments in Greece, more specifically, in the energy storage sector, if the government shapes a suitable institutional framework, company CEO Antonio Cammisecra has noted.

“We regard Greece as an investment destination,” Cammisecra told journalists yesterday during the opening ceremony of Enel’s wind energy complex, Greece’s largest such project, on the island Evia, slightly northeast of Athens, and one of Europe’s biggest.

Legal framework concerning energy storage has remained pending since the tenure of the previous energy minister Giorgos Stathakis.

The new energy ministry and RAE, the Regulatory Authority for Energy, are both currently working on shaping framework for energy storage, expected to be delivered in 2020.

Greece needs to work on simplifying current RES licensing procedures if renewable energy is to gain further ground in the country’s energy mix, Cammisecra, the Enel chief, pointed out during yesterday’s opening ceremony.

“The cost of a specific technology increases over the years for two reasons, firstly because this technology is overtaken by new developments, and secondly because the older it is the less amount of energy it produces,” the Italian official remarked.

Cammisecra described Enel’s wind energy complex on Evia, in the Kafireas region, as a “symbol of persistence”.

Combining seven wind energy parks, the Evia complex is a 300 million-euro investment with a 154-MW capacity covering electricity needs for 130,000 households. CO2 emissions will be reduced by 500,000 tons. This project’s capacity represents 4.5 percent of Greece’s wind park capacity total.

Greek wholesale electricity prices Europe’s highest

Wholesale electricity prices in Greece, averaging 65.5 euros per MWh, are Europe’s highest, well over the EU average of 43.3 eurpos per MWh, according to European Commission figures for the second quarter of 2019. This data highlights the lack of competition in Greece’s electricity market.

Malta’s wholesale electricity of 63.9 euros per MWh ranks the country second, while Poland is a distant third with an average price of 56.4 euros per MW/h in the second quarter, the data showed.

Price levels in Greece are well above those of neighboring Italy and Bulgaria, according to the data. In Italy, wholesale electricity averaged 51 euros per MWh while Bulgaria’s average was 41.2 euros per MWh.

Prices in central Europe were well below. Germany averaged 35.7 euros per MWh, Belgium 34.5 euros per MWh, the Netherlands 39.1 euros per MWh, France 35.3 euros per MWh, the Czech Republic 36.6 euros per MWh and Austria 36.9 euros per MWh.

Greece registered the second-biggest wholesale electricity price rise compared to a year earlier, the increase being 17 percent. Only Bulgaria surpassed this leap with a 22 percent increase. The EU average fell by one percent year-on-year.

These European Commission figures highlight the need for a swift and correct implementation of the target model in Greece in order to eliminate market distortions maintaining the country’s wholesale electricity market as Europe’s most expensive.

PHAOS Renewables and Sungrow join forces for Greece, Cyprus

PHAOS Renewables, a Greek company with significant experience in the PV sector since the birth of the Greek market back in 2007, has formed a partnership with Sungrow Power Supply, a global leader, for the Greek and Cypriot markets, the partners have announced.

The partnership was established to facilitate high-quality and reliability needs prompted by growth in both these markets, the partners announced.

As a result, PHAOS Renewables is now an official distributor of Sungrow in Greece and Cyprus.

Both companies have set a target for quick development and the acquisition of a market share proportional to Sungrow’s leading global position through the supply of its innovative products via the PHAOS Renewables channel and support.

PHAOS Renewables is committed to supplying high-quality services and offering constant support, both commercial and technical, it noted.

“We are very happy and proud to join forces with PHAOS Renewables and together introduce to the Greek and Cypriot markets our products and solutions. Especially, we are in the happy position through this agreement to launch our new CX series which have been developed with all the latest technological innovations and convenience of very easy commissioning,” noted Baris Sözener, Sungrow’s Director of Sales & Operations for Turkey, Greece, the Balkans and Ukraine.

“PHAOS Renewables provides world-class commercial and technical support and consultancy to its partners and clients and this is one of the reasons why we chose them as our strategic partner,” stressed Florian Chan, Sungrow’s Head of Distribution Europe.

Konstantinos Karagiannidis, General Manager at PHAOS Renewables, commented: “We are very happy and proud to have reached this distribution agreement for Sungrow products in Greece and Cyprus. It is widely known that Sungrow is the global leader in the solar inverters industry. This agreement recognizes the potential of PHAOS Renewables in the PV sector and also reinforces the company to achieve its goal of providing services and products of the highest quality to our partners and clients.”

Sungrow’s global installed capacity totals more than 87 GW, June figures showed. Founded in 1997 by University Professor Cao Renxian, the company is a leader in the research and development of solar inverters. Powered by a dedicated R&D team, it markets a broad product portfolio offering PV inverter solutions and energy storage systems for utility-scale, commercial, and residential applications, as well as internationally recognized floating PV plant solutions.

Sungrow products power installations in over 60 countries, maintaining a worldwide market share of over 15%, the company noted.

 

 

Balkans-focused energy forum on eve of Thessaloniki fair

Two key regional gas pipeline projects involving Greece and backed by the US, the Greek-Bulgarian IGB gas grid interconnection and a pipeline to link Greece and North Macedonia, will be at the center of attention in talks between energy minister Costis Hatzidakis and peers at the Southeast Europe Energy Forum in Thessaloniki on September 6, a day ahead of the opening of this year’s Thessaloniki International Fair.

Hatzidakis and the US Ambassador to Greece, Geoffrey R. Pyatt, will be key speakers at the forum, where speeches will also be delivered by the energy ministers of Bulgaria, Cyprus, Israel, North Macedonia, Romania and Serbia.

Besides the prospective gas pipeline from Greece to North Macedonia, the talks between Hatzidakis and his North Macedonian peer will also focus on an upgrade of the electricity grid interconnection linking the systems of the two countries, as well as an upcoming relaunch of the Okta oil pipeline, stretching from an ELPE (Hellenic Petroleum) facility in Thessaloniki to the company’s Okta refinery and storage facility in North Macedonia.

The gas pipeline is the most important project of the three as an interconnection of the Greek and North Macedonian gas systems does not exist.

The Greek-Bulgarian IGB gas interconnection, along with TAP, to carry Azeri natural gas through northern Greece, Albania and across the Adriatic Sea to central Europe via Italy, are Greece’s two most significant international energy projects.

They promise to further diversify Europe’s energy sources and weaken Russia’s dominance in the region.

Meanwhile, Russia is promoting its own energy and geopolitical interests in the region. Last month, Greece was excluded from Turkish Stream, a Russian-Turkish gas pipeline plan whose second segment is now planned to run through Bulgaria, not Greece.

The first segment of this gas pipeline project is planned to supply Russian natural gas to the Turkish market and the second to Europe’s south and southeast.

 

Greek, Cypriot, Israeli officials seeking Italy’s East Med return

Greek, Cypriot and Israeli officials are working on details of a plan aiming to win back Rome’s support for the East Med pipeline, an ambitious 1,900-km pipeline to carry southeast Mediterranean natural gas from Israel to Europe via  Italy.

Efforts by Washington and Brussels to lure back Italy, whose coalition government has withdrawn the country’s support for the project, are pivotal.

Part of the overall diplomatic effort may be unveiled at an Athens energy summit today.

The Greek, Cypriot and Israeli energy ministers, Costis Hatzidakis, Giorgos Lakkotrypis and Yuval Steinitz, respectively, as well as US Assistant Secretary Francis Fannon, are taking part in the summit.

Fannon held successive meetings in Athens yesterday with Greece’s energy minister and the deputy foreign minister Konstantinos Fragogiannis. The East Med project’s promotion was a key subject of these meetings, especially Fannon’s talks with Hatzidakis, Greece’s energy minister.

Last May, Italian Prime Minister Giuseppe Conte, heading Italy’s right-wing populist coalition, declared Rome does not want the East Med pipeline to land on Italian territory. Instead, he proposed the pipeline’s link to TAP, another gas pipeline project being developed to carry Azerbaijani natural gas to Europe, via Italy.

East Med is envisioned to primarily carry deposits from Cyprus’ recently discovered “Aphrodite” gas field and the Israeli-controlled block “Leviathan” along a route stretching from Israel to Europe, also via Italy.

In response to Italy’s stance, Israel now appears to favor an alternate route for East Med that would avoid ending up on the Italian coast. Experts regard this prospect as difficult but not impossible as the pipeline project is still at the planning stage. Greece and Cyprus prefer Italy’s incorporation into the pipeline route.

 

 

New effort for East Med agreement at Athens energy summit

Greek gas utility DEPA and Italian energy giant Edison, collaborating on a plan to develop the East Med pipeline, envisioned to link the Greek, Cypriot and Israeli natural gas systems, are looking to take a crucial technical step ahead of construction.

Their YAFA Poseidon joint venture – spearheading the ambitious project, a 1,900-km pipeline stretch with an investment cost of between 6 and 7 billion euros – is gearing up for the launch of FEED (Front-End Engineering Design), environmental and detailed underwater research studies.

The European Commission has approved 34.5 million euros from the EU’s Connecting Europe Facility (CEF), a funding instrument, for these studies. The CEF amount will cover half the cost of the aforementioned preliminary studies, which will push the plan ahead to a mature stage.

The pipeline project is planned to carry southeast Mediterranean natural gas, primarily deposits from Cyprus’ recently discovered “Aphrodite” gas field and the Israeli-controlled block “Leviathan”, along a route stretching from Israel to Europe.

An agreement between Greece, Cyprus, Israel and Italy, where the pipeline is planned to conclude, is still needed.

East Med plans have been at a standstill ever since the current Italian government announced it was stalling the project.

According to sources, the Greek, Cypriot and Israeli energy ministers will seek to restart procedures and also send out a message of encouragement to the Italian government when they meet at an Athens energy summit tomorrow. US Assistant Secretary Francis Fannon will also participate.

East Med, still at a theoretical stage, promises geostrategic might for Greece, Cyprus and Israel, as well as the USA, on southeast Mediterranean energy matters, especially against Turkey’s opposition to hydrocarbon exploration within Cyprus’ Exclusive Economic Zone (EEZ).

The pipeline plan also promises to break Russia’s dominance of gas supply to the EU.

 

 

Greek-Cypriot-Israeli energy summit highlights US interest

Washington’s supportive interest in the energy partnership between Greece, Cyprus and Israel has grown, driven by the prospect of hydrocarbon exploration in the southeast Mediterranean region as well as the East Med natural gas pipeline, planned to carry Cypriot, Israeli and, possibly, Egyptian natural gas to the EU via Greece and Italy.

Highlighting this interest, an upcoming Athens energy summit, scheduled to take place on August 6 and 7, comes as a US initiative, energypress sources informed.

It will follow a meeting just days ago, at the East Med Gas Forum in Egypt, that brought together Greek energy minister Costis Hatzidakis with his Cypriot and Israeli peers, Giorgos Lakkotrypis and Yuval Steinitz, respectively. In addition, Greek Prime Minister Kyriakos Mitsotakis recently met with Cypriot leader Nicos Anastasiades.

US Assistant Secretary Francis Fannon, head of the Bureau of Energy Sources, will also take part in the Athens energy summit. Fannon is scheduled to meet with Hatzidakis, Greece’s energy minister, and the country’s deputy foreign minister Konstantinos Fragogiannis on the eve of the event.

The summit highlights the US-fostered partnership between Greece, Cyprus and Israel, united against escalating Turkish tension concerning offshore hydrocarbon exploration plans within Cyprus’ Exclusive Economic Zone (EEZ).

The event’s participants are also expected to discuss the East Med pipeline. An agreement between the three countries and Italy remains pending. Last spring, Italian Prime Minister Giuseppe Conte claimed he sees no benefits for Italy in the project, effectively bringing the country’s effort in the matter to a standstill.

Washington openly supports this natural gas pipeline as it promises to establish an alternative supply route to Europe that would restrict Moscow’s energy dominance on the continent, through Gazprom.

Sideline efforts are being made to alter Italy’s negative stance, sources informed. A message could be projected to Rome through the imminent Athens event.

RES energy mix targets likely; bureaucracy, networks an issue

Greece will most likely reach a RES energy mix target set for 2020, but problems subduing investment activity in the renewable energy sector, bureaucracy and insufficient network investments being two key concerns, remain, the European Court of Auditors has observed in a special report focused on renewables and electricity generation.

Greece, along with Latvia and Austria, will most probably meet their 2020 target if they continue to implement measures targeting renewables at the current pace, the report noted, adding all three EU member states currently require increases of less than 2 percentage points.

Inspections were conducted in Greece, Germany, Poland and Spain for the report, titled “Wind and solar power for electricity generation: significant action needed if EU targets to be met.”

Specific national targets for the share of gross final energy consumption coming from renewables have been set, ranging from 10 percent to 49 percent.

Greece’s RES target for 2020 is 39.8 percent. Spain has a target of 39 percent, Germany is aiming for 38.6 percent and Poland’s figure is 19.1 percent.

Germany and Spain maintained high rates of progress between 2010 and 2017, while Greece is behind schedule. In 2017, the country was 7 percentage points off target, the report noted.

 

Greek power producers also eyeing Balkan export potential

The country’s power producers are focusing on the market prospects of  neighboring countries along with a heightened interest in Greece’s electricity market as a result of the upcoming elections, seen bringing the main opposition New Democracy party into power for more decisive reform action at power utility PPC, and intensified market competition.

Investments plans by PPC, currently developing its Ptolemaida V power station, as well as by private-sector enterprises, which have announced plans for five new state-of-the-art units, are expected to create an overabundance of electricity, even of all these plans are not executed. This is one of three main factors turning the attention of power producers to neighboring markets.

Also, it has become clear that Balkan markets lack flexibility in electricity generation as they primarily depend on coal, while gas networks that could support flexible gas-fueled power stations in the region are insufficient.

A third factor contributing to the heightened the interest of local producers for energy-related business in the wider region is Greek power grid operator IPTO’s ongoing upgrade of Greece’s grid interconnections with neighboring countries, especially Bulgaria and North Macedonia, which promises to create greater export potential.

Besides the independent producers, PPC is also looking to capitalize on this export potential.

Lender representatives visiting Athens in a pre-election mood

Pending energy market reforms, including privatizations, PPC’s disinvestment of lignite units, and other market liberalization measures, will be discussed between government officials and the country’s lender representatives, visiting Athens to begin a post-bailout review this week.

Long-term decisions on various matters will most likely need to be made following Greece’s elections, due in autumn, once the political climate has settled. This delay, though, could end up prompting tougher demands by the lenders, including the European Commission.

PPC’s sale of lignite units, relaunched following a failed previous effort, is expected to dominate the talks. The disinvestment’s deadline for binding bids has been extended to May 28, which virtually coincides with the European elections, making the prospect of the sale procedure’s punctuality uncertain.

The lenders are expected to push for financial restructuring measures at state-controlled PPC, which has just posted disappointing results for 2018. Some of these measures will entail political cost.

The lender representatives will also push for decisions on slow-moving energy-sector privatizations. The sale procedure for gas utility DEPA has fallen behind schedule while uncertainties have crept into the the ELPE (Hellenic Petroleum) privatization.

The target model as well as Crete’s urgently-needed electricity grid interconnection with Athens will also be on the agenda. The latter has led to a control-related dispute between Greek power grid operator IPTO and Euroasia Interconnector, a consortium of Cypriot interests heading a wider PCI-status Greek-Cypriot-Israeli electricity grid interconnection project.