Gas amounts channeled north on decline, projects in doubt

Market interest for further development of European gas infrastructure appears to be weakening, raising concerns about the success of forthcoming trans-Balkan market tests aimed at increasing regional network capacity, sources have underlined.

Although the level of interest for further development of gas infrastructure in Greece and the wider region was considerable in non-binding phases of market tests, potential users are now holding back as the procedure’s binding phases approach.

This essentially means that market players are avoiding making long-term commitments, which is necessary in order for the network expansion and upgrade plans to proceed.

Gas-order cancellations from Greece to markets further north are being recorded, which, if continued, will cast doubts over gas network expansion plans, or even make them unnecessary, sources told energypress.

A similar trend has taken hold at Greek gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens, as market players are cancelling LNG shipments because they have nowhere to channel gas quantities.

Though there is still plenty of time ahead before binding bids are submitted to trans-Balkan market tests, whose results will offer a clear-cut picture of the situation, the level of interest being recorded by operators preparing project proposals is well below that expressed in non-binding market tests. The Greek-Bulgarian IGB gas pipeline, now being gauged for a capacity boost, is one such example.

Gas consumption levels are on a downward trajectory and gas storage facilities in the EU are at high levels for this time of the year, averaging 68.61 percent full.

It is still too early to draw definite conclusions, but latest data is showing a change of scene. It remains to be seen how this shift could influence the investment plans of operators.

Alexandroupoli FSRU, arriving 1Q, to offer 45,000 MWh daily

The Alexandroupoli FSRU, scheduled for launch at the country’s northeastern port in the first quarter, is planned to start operating by supplying roughly 45,000 MWh of natural gas into the Greek network daily, a major sufficiency boost for the domestic system.

The facility, set for launch by March 10, will initially offer an annual capacity of 1.5 bcm, or 27 percent of its annual capacity, to the Greek system. A further 4 bcm quantity will be supplied to the Bulgarian network via the IGB grid interconnection, and, by extension, Romania, North Macedonia, Serbia, and in any markets where traders that have signed contracts with Gastrade, the project’s consortium, have customers.

An initial LNG load, to be used for testing, is scheduled to reach the Alexandroupoli LNG on January 20. It will not stem from Russia as the project is designed to contribute to ending southeast Europe’s reliance on Russian gas.

The testing stage will entail filling a 28-kilometer gas pipeline, running mostly underwater, that connects the terminal with the Greek gas system, in order to check all systems and correct any minor issues so that the FSRU can be ready to operate commercially after six to seven weeks, or early March.

The FSRU, comprised of a floating storage unit with a capacity of 153,500 m3 and three gasification units, offering daily gasification capacity of approximately 22.5 million m3, is a project of national significance that reinforces Greece’s role as an energy gateway to the markets of the wider region.

 

Revythoussa LNG terminal still vital despite lessened activity

Capacity increases at the TAP pipeline, facilitating the delivery of Caspian gas to destinations in Europe, and the IGB gas pipeline linking Greece and Bulgaria, plus the scheduled launch, early in 2024, of the Alexandroupoli FSRU at the country’s northeastern port, will lessen the number of LNG tankers delivering quantities to the Revythoussa LNG terminal, just off Athens, for eventual distribution to the Bulgarian market, but the terminal remains vital for Greece’s energy security and supply.

In addition, an agreement signed last January by Turkey and Bulgaria’s respective state-owned energy companies, Botas and Bulgargaz, for Turkish supply to Bulgaria of 1.5 bcm of natural gas, annually, over a 13-year period, also promises to further decongest activity at the Revythoussa LNG terminal.

The Bulgarian-Turkish agreement had prompted a number of questions in the domestic and European markets regarding its terms and conditions, as well as its impact on Greece’s gas infrastructure.

However, as was recently highlighted by Sotiris Bravos, Senior Commercial Services Manager at DESFA, Greece’s gas grid operator, the Revythoussa LNG terminal’s commercial role will only be limited in trade concerning the Bulgarian market.

In 2022, the Revythoussa LNG terminal covered two-thirds of Bulgaria’s natural gas needs, a performance not expected to be repeated this year given the increased number of facilities – TAP, IGB, and, slightly later on, the Alexandroupoli FSRU – serving the Bulgarian market.

Even so, the Revythoussa LNG terminal remains a crucial part of the country’s gas grid, especially regarding supply security and the grid’s balance, Bravos, the DESFA official, noted.

At present, the Revythoussa LNG terminal is Greece’s only LNG entry point and one of the country’s four natural gas entry points.

DESFA’s administration believes new gas infrastructure will not compete against the Revythoussa LNG terminal as it remains a facility of major importance for the Greek gas grid and the significantly increased needs of central Europe.

ICGB concludes non-binding phase for expansion of IGB’s technical capacity

The independent transmission system operator ICGB has announced a successful completion of the non-binding phase of the incremental capacity process launched in July to assess the market interest in increasing the IGB pipeline’s total technical capacity.

“The market interest for a few consecutive gas years is nearly two times higher than our initial expectations. While for now these indications are non-binding for the shippers, this is a great first step towards a potential expansion of the IGB pipeline’s capacity from 3 bcm/y to 5 bcm/y”, said ICGB Executive Officers George Satlas and Teodora Georgieva. The two discussed updates on the plans for the interconnector’s development with other TSOs in the region during an event dedicated to the Vertical Gas Corridor held in Thessaloniki, Greece.

“In less than a year of commercial operations, the interconnector Greece-Bulgaria became an essential part of Bulgaria’s path towards energy diversification, enhanced security of supply and energy independence. Over 82% of the total capacity for the upcoming gas year is already booked and we’re looking ahead towards plans for expansion, further strengthening Bulgaria and Greece’s roles on the region’s energy map”, Georgieva noted.

According to her, gas traders have expressed interest for up to 4 bcm/y additional capacity for the next few gas years in the interconnection points of IGB with the Greek national operator DESFA and the Bulgarian national operator Bulgartransgaz.

George Satlas highlighted IGB’s synergy with the LNG terminal in Alexandroupolis and the pipeline’s key role as part of the Southern Gas Corridor and the Vertical Gas Corridor. “With the changed security environment in the region and the change of gas flow from south to north, Bulgaria is becoming a gas transit country. Together with Greece and its growing efforts towards developing LNG projects, our two countries are showing an excellent cooperation model in the energy sector”, he noted.

IGB is the first route for diversified supplies of natural gas to Bulgaria, guaranteeing increased security of supply and diversity of sources. The gas pipeline enables the transportation of natural gas from new sources to other countries in the region as well, including Moldova and Ukraine.

The IGB (Greece-Bulgaria Gas Interconnector) project is being implemented by the joint venture company ICGB AD, registered in Bulgaria in 2011 with shareholders BEH EAD (50%) and IGI Poseidon (50%). The co-shareholder IGI Poseidon is a company registered in Greece, with shareholders the Greek company DEPA International Projects (50%) and the Italian energy group Edison S.p.A (50%).

In accordance with its charter, ICGB AD is the owner of the IGB gas pipeline, financing its implementation, distributing its transmission capacity and receiving revenues from the transmission of natural gas.

The IGB gas pipeline connects with the Greek national gas transmission system (DESFA S.A.) and the Trans-Adriatic gas pipeline (TAP AG) in the area of Komotini (Greece), and with the Bulgarian gas transmission system (Bulgartransgaz EAD) in the area of Stara Zagora. The total length of the gas pipeline is 182 km, the diameter of the pipe – 32” – and a design capacity of up to 3 billion m3/year in the direction Greece – Bulgaria. Depending on the market interest for larger capacity and the possibilities of the neighboring gas transmission systems, the capacity of IGB is designed with the option for increase up to 5 billion m3/year with additional construction of a compressor station.

 

 

Major grid capacity reservation interest expressed at DESFA auctions

Gas grid operator DESFA’s auctions offering grid capacity reservations, held last week, have confirmed an increase in interest from Greek and foreign companies, energypress sources have informed.

Capacity reservations for the Greek gas grid’s Sidirokastro exit point and Nea Mesimvria entry point – both are in the north – reached 98.5 percent and 100 percent, respectively.

The Nea Mesimvria entry point, it should be noted, is the interconnection point linking the country’s gas grid with the TAP pipeline for import of Azeri natural gas.

An auction is still in progress for the Greek grid’s Amfitriti entry point, in the northeast. Five rounds of auctions are being held daily, in accordance with EU rules. This ongoing procedure, sources noted, comes as confirmation of the heightened interest of users for this specific entry point.

The Amfitriti entry point is planned to receive natural gas from the prospective Alexandroupoli FSRU for transmission into the Greek grid before gas quantities are redirected north of the border, via the Greek-Bulgarian IGB pipeline.

Participants at DESFA’s auctions last week showed minimal interest for long-term grid capacity reservations. DESFA launched 15-year offers at these auctions. Most system users focused on agreements for the next gas year, covering October 1, 2023 to September 29, 2024.

DEPA Commercial, Moldova’s Energocom nearing gas deal

Greek gas company DEPA Commercial is close to establishing a gas supply deal with Moldovan state gas and electricity supplier Energocom, sources have informed, noting the two sides are currently discussing gas quantities and prices for what could be a long-term agreement.

Both Energocom and Moldova, as a whole, are looking for alternative energy sources as the Balkan country, neighboring Ukraine, seeks to end its reliance on Russian fossil fuels.

Kostas Xifaras, chief executive at DEPA Commercial and Energom’s general director Victor Binzari have held talks as part of an official visit to Athens by the leadership of Moldova’s energy ministry.

Greek energy minister Kostas Skrekas, who met with his Moldovan counterpart, Victor Parlikov, during this visit, released an announcement about the prospective supply deal.

DEPA Commercial gas quantities would reach Moldova through an eastern corridor, or network of gas pipeline interconnections linking Greece with Bulgaria (IGB), Bulgaria with Romania, and Romania with Moldova.

DEPA Commercial is also looking to broaden its gas trading activities with other Balkan countries ahead of the arrival of the Alexandroupoli FSRU, a floating LNG terminal now being developed in Greece’s northeast.

DEPA Commercial is a member of the five-member Gastrade consortium established by the Copelouzos group for the development and operation of the Alexandroupoli FSRU.

Greek-US energy agenda focused on 3 projects

Three energy infrastructure projects, the Alexandroupoli FSRU in Greece’s northeast, an oil pipeline running from the Alexandroupoli port to Burgas, on Bulgaria’s Black Sea coast, and a Greek-Egyptian grid interconnection, were focal points in talks yesterday between Greek and American officials, as part of US Secretary of State Anthony Blinken’s official visit to Athens.

The two sides, meeting for the 4th round of a Greece-US Strategic Dialogue, appeared determined to push ahead with the three projects, propelled by Russia’s war on Ukraine, which has prompted Europe to move in a direction ending its reliance on Russian fossil fuels.

It was agreed that Athens and investors need to accelerate efforts for the aforementioned projects to further marginalize Russian energy supply to Europe.

Besides offering full support for the three energy infrastructure projects, US officials also expressed satisfaction about the recent launch of the Greek-Bulgarian IGB gas pipeline as well as ongoing plans for a pipeline to run from Greece to North Macedonia.

However, the US officials kept a distance from the discovery of gas deposits by Israel, Cyprus and Egypt in the east Mediterranean, as well as the East Med gas pipeline plan – which would connect Israel, Cyprus and Greece before crossing to Italy visa the Poseidon pipeline – presumably to avoid upsetting Turkey, despite problems that have weighed down US-Turkish ties of late.

 

Greek-Bulgarian oil pipeline MoU signed, US offers support

Following months of diplomatic and entrepreneurial activity, Greek energy minister Kostas Skrekas and his Bulgarian counterpart, Rossen Hristov, have just signed a Memorandum of Understanding in Athens for the development of an oil pipeline to run from Alexandroupoli in Greece’s northeast to Burgas, on Bulgaria’s Black Sea coast.

The two ministers signed the MoU within the framework of a meeting between Greek Prime Minister Kyriakos Mitsotakis and Bulgarian President Rumen Radev.

Greece’s Alexandroupoli port – developing into one of the eastern Mediterranean’s most pivotal energy hubs as a result of the reversal of energy source flow, nowadays moving from south to north as a result of Europe’s decision to end its reliance on Russian fossil fuels – will facilitate oil primarily imported from the Middle East and headed to east European markets.

The oil pipeline will cover a distance of 260 kilometers, equally divided between Greece and Bulgaria, and offer an annual capacity of 10 million tons, down from an original plan of between 35 and 50 million tons.

A section of the Greek-Bulgarian oil pipeline is planned to run parallel to the IGB gas pipeline linking the neighboring countries.

Work on the oil pipeline is expected to begin within the next two years, while its completion is slated for three to four years from now, a swift procedure for such projects, as environmental permits have already been issued.

The Greek-Bulgarian oil pipeline has not been embraced by Turkey as it will reduce the geopolitical importance of the Bosphorus Strait. Contrary to the past, the US is now expressing full support for the Greek-Bulgarian oil pipeline.

 

Greece becoming a key gas exporter, rise in loads relayed

Greece is developing into a major exporter of natural gas with roughly one in three shipments that reach the country relayed to other countries, well over last year’s level of 9.8 percent.

Russia’s war on Ukraine has increased the geostrategic importance of Europe’s south, including Greece, in terms of gas transportation, supply routes from the continent’s south to north now dominant, a reversal of the flow in previous decades.

LNG shipments to Greece supply a large number of landlocked European countries, all the way north to Ukraine. As a result, Greece’s gas exports have skyrocketed in 2022.

In the first eleven months this year, the country’s gas exports reached 26 TWh, more than triple the level recorded for all of 2021, when the year’s gas exports totaled 7.6 TWh.

Greece’s gas exports are expected to rise even more in 2023 as a result of last October’s launch of the IGB pipeline running from Greece to Bulgaria.

Technical solutions are now being sought so that gas exports can also be made via the IGB pipeline as soon as the Alexandroupoli FSRU, a project led by Gastrade, is launched in late 2023. The Alexandroupoli LNG terminal’s arrival will further boost Greece’s capacity to export gas.

 

 

Bypass solution for Alexandroupoli FSRU gas to IGB pipeline

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

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

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

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

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

 

 

September LNG quantities lower but still considerable

Natural gas quantities to be shipped to the Revythoussa islet LNG terminal just off Athens will total 562,000 cubic meters in September, below the 609,000 cubic meters tallied in August, but equally important for the country’s energy sufficiency effort.

A total of six LNG tankers will moor at the Revythoyssa facility this month, bringing in 13 separate orders.

More specifically, Bulgaria’s MET energy has ordered four shipments for 104,000 cubic meters, Motor Oil is expecting one shipment carrying 36,900 cubic meters, Bulgargaz is awaiting two shipments for a total of 110,00 cubic meters, Mytilineos has placed an order for one shipment carrying 147,700 cubic meters, Elpedison has placed an order for three shipments totaling 62,00 cubic meters, and DEPA is expecting two shipments totaling 100,000 cubic meters.

These orders have been placed to support the country’s gas-fueled power stations during these challenging times, and also to cover energy needs in neighboring Bulgaria, which has stopped receiving Russian gas for some months now.

Bulgaria’s caretaker government is seeking to increase LNG quantities received through Greece to take advantage of the Greek-Bulgarian IGB pipeline’s upcoming launch, expected imminently.

The neighboring country is also in talks with Azerbaijan for increased imports. Sofia has not ruled out new gas supply negotiations with Russia’s Gazprom should other solutions prove insufficient.

IGB gas pipeline nearing launch, doubts dismissed

The prospective IGB gas pipeline linking Greece and Bulgaria is believed to be almost ready for its commercial launch, scheduled for October 1, despite recent doubts that were cast over the entire project.

Certain analysts recently questioned whether American LNG supply to Bulgaria, through the IGB pipeline, would go ahead, claiming the new Bulgarian government wants to renegotiate a supply agreement with Russia’s Gazprom.

ICGB AD, the consortium behind the IGB project has announced, in what is seen as a response to the scare, that an auction offering pipeline capacity to users will be held this Thursday through the online platform BALKAN GAS HUB EAD, from 9am to 12pm (Sofia time).

Greek construction company AVAX, developing the project, has set itself an end-of-August objective, which could be stretched to September 8, the latest, to complete pending work and obtain required permits from the Bulgarian authorities.

If all this goes according to plan, the IGB gas pipeline will be ready to operate on October 1.

DEPA Chief: ‘Holistic approach to energy matters needed more than ever’

Mr. K. Xifaras, CEO of Public Gas Corporation of Greece (DEPA) SA., writes for International Energy Exhibition of Greece 2022

DEPA Commercial is Custodian of Greece’s energy security and of the smooth operation of the domestic energy market. Today, the energy sector, both in Greece and worldwide, is faced with a series of challenges and unforeseen factors which highlight, now more than ever, the need for a holistic approach to energy matters. The need to contain energy costs and support the society, on one hand, and the process of energy transition, on the other, have created a situation in which the market needs to find a balance which will ensure both the country’s energy efficiency and its survival in sustainable terms.

While trying to solve this difficult equation, the role of natural gas, as a bridge, fuel proves to be decisive for shaping the future of the energy market, given the diversification of energy sources and routes of supply and transport, as well as the expansion of storage capacity. DEPA Commercial, which consistently serves these strategic priorities, has been developing a multi-level strategy for the last three years that has proven to be particularly effective. A strategy with double focus: the verticalization and expansion of corporate activities, and the seamless transition to “green” energy, both of which are national goals described in the National Energy and Climate Plan and the European Green Agreement, enhancing our country’s role as a regional energy hub for the wider Southeast European region.

In order to cover the country’s immediate energy needs and to shield its energy security, DEPA Commercial is increasing the supply of LNG either through current contracts or through the spot market, while having already secured long-term agreements on more favorable terms. At the same time, the company is investing in important infrastructure projects and programs, which are drastically reshaping the energy status quo of the region and are contributing decisively to the process of Europe’s independence from Russian gas, such as the Greek-Bulgarian pipeline – IGB and the offshore LNG terminal (FSRU) in Alexandroupolis. Both, projects which will significantly increase the capacity of supply and storage of both Greece and the neighboring countries it serves.

TAP, Poseidon and EastMed are equally important pipeline projects, with the latter returning dynamically to the forefront as a result of the energy crisis, since it will enable the transport of natural gas from the fields of the Eastern Mediterranean to Europe. To that direction, DEPA Commercial is currently in advanced discussions with trading companies from Israel and Egypt.

In this way, a safety net is established regarding the security of supply in the wider region, which upgrades Greece’s geopolitical status by transforming it into a regulatory factor in the energy landscape.

Simultaneously, given the enhanced importance of natural gas, we have designed a comprehensive strategy aiming, on the one hand to expand the use of natural gas, both geographically and in terms of uses, and on the other hand to create the conditions for the development and utilization of renewable and alternative forms of energy. Keeping this in mind, DEPA Commercial is leading the developments towards the transition to a greener economy by designing and implementing initiatives that promote the further penetration of natural gas in the country’s energy mix, as a transitional fuel on the way to cleaner energy forms. The company also contributes substantially to the promotion of gas mobility and the use of cutting-edge technologies, such as Small-Scale LNG and CNG, thus expanding even further the natural gas network and ensuring distribution even in the most inaccessible areas. At the same, time, emphasis is placed on the development of a sustainable and efficient LNG supply chain for maritime transport that will increase the growth prospects of the Greek shipping sector.

With its sights on the future, DEPA Commercial is already active in the field of Renewable Energy Sources by creating a “green” portfolio that exceeds 200 MW of photovoltaic parks, and is also developing projects, infrastructure and technologies which will be able to serve in the future even “greener” energy such as hydrogen and biomethane.

Moreover, at DEPA Commercial we have proven that we operate always considering pertinent societal issues and, for this reason, with a true sense of responsibility we are contributing decisively to the absorption of a significant percentage of the rise in international gas prices, through the implementation of targeted market interventions aimed at supporting households and businesses, in full cooperation with the Ministry of Environment and Energy.

With a solid vision and through hard work, DEPA Commercial is today an integrated energy company, with strong bases, operating vertically and according to modern corporate governance terms. We are meticulously planning our next steps and we are creating the conditions to successfully meet the ever-changing needs of the market and the economy.

 

IGB moves close to launch, ICGB consortium certified

The Greek-Bulgarian IGB gas pipeline has moved a step closer towards its launch, expected around the end of this month, following the completion of a certification procedure for the ICGB consortium behind the project.

The European Commission, according to information made available, has approved a certification application submitted by the Greek Regulatory Authority for Energy, RAE, and its Bulgarian counterpart, EWRC.

Greek Prime Minister Kyriakos Mitsotakis and Bulgarian leader Kiril Petkov will both attend the project’s inauguration ceremony in Komotini, northeastern Greece, this Friday, ahead of the project’s commercial launch towards the end of the month.

The two leaders are expected to highlight this project’s contribution to the EU’s ongoing effort to end the continent’s reliance on Russia’s Gazprom.

The IGB gas pipeline will offer an alternative natural gas route into Bulgaria, initially via the TAP route and, from autumn onwards, through Greece’s gas grid. From 2023, the IGB will serve as a gateway for LNG imports from coastal FSRUs in the region. LNG quantities will reach Bulgaria, Romania, even Ukraine, through pipeline interconnections.

IGB nearing completion, Bulgarian PM to visit Komotini

The Greek-Bulgarian IGB gas pipeline, whose construction is expected to be completed by mid-April, promises to contribute to the EU’s effort for drastically reduced reliance on Russian gas.

The IGB gas pipeline, a 50-50 joint venture of the ICGB consortium, involving Greek-Italian company IGI Poseidon (DEPA and Edison) and Bulgaria’s BEH, will run from Komotini, northeastern Greece, to Stara Zagora in Bulgaria and be linked with the TAP pipeline that runs across northern Greece for supply of Azerbaijaini gas to the region.

The IGB pipeline will offer a second interconnection between Greece and Bulgaria, in addition to the nearby Sidirokastro link.

Last week, EU officials announced a new energy strategy, Repower EU, aiming to reduce Russian gas imports to the continent by two-thirds. The establishment of alternative energy supply routes into Europe is now a priority on the Brussels agenda.

Bulgarian prime minister Kiril Petkov is scheduled to visit the IGB project contactor AVAX’s construction site in Komotini this Friday. His Greek counterpart Kyriakos Mitsotakis has been forced to miss the occasion after being sidelined by the Covid-19 virus. Energy minister Kostas Skrekas will fill in.

IGB gas pipeline launch delayed by 8 months for late-June, 2022

The commercial launch of the Greek-Bulgarian IGB gas pipeline has been deferred by 8 months, for June 30, 2022, as a result of pandemic-related obstacles faced during the project’s development.

The gas pipeline’s technical work is now expected to be completed by the end of this year, instead of April, 2021, as was originally scheduled.

Two months earlier, ICGB, the consortium developing the project, informed companies that have reserved pipeline capacities through a market test of the unavoidable delay in the commercial launch.

Contractor AVAX, the winning bidder for the project’s construction in an international tender staged by ICGB, began developing the pipeline in May, 2019, prior to the pandemic, whose emergence and impact forced the company to drastically reschedule the IGB project.

International quarantine rules have delayed the IGB project’s progress as many workers needing to regularly cross the Greek-Bulgarian border have been forced to quarantine, each time, for days.

The quarantining rules have also complicated the transfer of equipment needed from one country to the other.

The ICGB consortium is comprised of Bulgaria’s BEH, holding a 50 percent stake, and IGI Poseidon, a 50-50 partnership involving DEPA International Projects and Italy’s Edison.

The IGB gas pipeline, to cover a total length of 182 kilometers, will run from Komotini, northeastern Greece, to Stara Zagora in Bulgaria, offering a second interconnection between the two countries, in addition to the nearby Sidirokastro link.

The project is planned to begin operating at an annual capacity of 3 bcm, which could be boosted to 5 bcm at a latter date.

 

RES spatial plan to be delivered within 2021, Action Plan notes

The completion of a RES sector spatial plan within the current year has been included in an energy ministry Action Plan for 2021, just published along with the respective action plans of all other ministries.

The energy ministry’s action plan lists interventions planned for 2021 in nine areas under its authority, including energy-sector privatizations, energy market reforms, support for decarbonization and recycling, adoption of circular economic principles, greenhouse gas emission reduction, the tackling of climate change effects, as well as green energy transition.

RES sector measures this year will help cut down the time needed by new RES projects for licensing procedures to two years, the ministry anticipates in its action plan.

It also expects the installation, by the end of the year, of at least 2,000 recharging units for electric vehicles in public areas, including along highways, and at private properties, including domestic and commercial.

On the privatization front, the energy ministry expects all seven energy privatization plans to have been completed or reached an advanced stage by the end of the year.

On energy market reforms, the adoption of a remuneration mechanism for grid sufficiency, to replace a transitional mechanism remunerating flexibility, is a standout feature.

The energy ministry also intends to adopt, as Greek law, an EU directive promoting energy storage and demand response systems.

The ministry’s action plan also anticipates the signing of agreements this year for distribution network development and RES penetration support. It also expects DEDDIE/HEDNO, the distribution network operator, to announce a tender for the installation of smart power meters within the current year.

Taking into account plans by DEDDIE/HEDNO and power grid operator IPTO, the ministry expects investments in distribution and transmission networks to reach one billion euros this year.

Investments for gas network upgrades and expansion are expected to reach at least 300 million euros, primarily driven by projects planned by gas distributor DEDA, covering all areas around the country except for the wider Athens, Thessaloniki and Thessaly areas.

On international projects, the action plan notes that a Greek-Bulgarian gas pipeline project, the IGB, promising to significantly diversify Greece’s gas sources, will be completed by the end of 2021.

A latest edition of the Saving at Home program subsidizing energy efficiency upgrades of properties, budgeted at one billion euros, will stimulate work on 80,000 buildings in 2021, according the energy ministry’s action plan.

This activity will contribute to a National Energy and Climate Plan objective for an improvement, by 2030, of energy efficiency at buildings by 38 percent, reducing energy consumption to levels below those registered in 2007, the action plan notes.

 

Greece, Israel eyeing broader alliance for Balkans, central Europe

The Greek-Israeli energy alliance is broadening its scope by aiming for the establishment of a Greek gateway to facilitate Israeli gas supply to the Balkan region and, by extension, central Europe.

This objective, part of strong diplomatic relations between the two countries in energy, was confirmed during a recent virtual meeting between Greece’s newly appointed energy minister Kostas Skrekas and his Israeli counterpart Yuval Steinitz.

Their bilateral talks will be followed up by broader meeting today to involve the energy ministers of Greece, Israel, Cyprus, Serbia, Bulgaria, Romania, North Macedonia and Hungary.

The participating officials will seek to lay the foundations for a closer energy alliance that would facilitate distribution from Israel’s Leviathan gas field via alternate routes – the Alexandroupoli FSRU and the IGP – to soon be offered by Greece.

The aforementioned Balkan and central European countries are extremely keen on securing alternative supply routes, diplomatic sources informed.

Much work is needed by Israel and Greece to establish energy alliances with Balkan countries, but a first step will seemingly be taken today.

US investments in Greek RES sector rising, LNG imports up

New US investments in Greece’s RES sector are on the rise, the energy ministry has stressed following a meeting yesterday between Greek energy minister Costis Hatzidakis and the U.S. Ambassador to Greece, Geoffrey Pyatt, for a discussion on major energy project plans in the wider region and the related American investment activity.

U.S. companies such as ONEX, Black Summit, with support from DFC (International Development Finance Corporation), Quantum Energy Partners, National Energy, General Electric, Fortress Investment Group, Blink and Tesla are all currently pursuing investments in the Greek market.

Hatzidakis, the energy minister, expressed satisfaction over the level of foreign investments in Greece, noting U.S. participation has significantly increased, especially in the energy sector.

Last month, 547 Energy, an American renewable energy venture backed by Quantum Energy Partners, participated for a third time in a row in a RES auction staged by RAE, the Regulatory Authority for Energy, adding 107 MW in wind energy capacity to its Greek portfolio for a current tally of eight RES projects and 390 MW, the energy ministry noted.

National Energy is drawing American funds to develop wind and solar energy projects in Greece with a total capacity of 270 MW, the statement added.

Also, the energy ministry noted, General Electric has supplied equipment for a wind energy farm in Fokida, west of Athens, a project being partially financed by the Fortress Investment Group; Blink recently began an investment plan in the electromobility sector, for rechargers and other equipment; while Tesla, a producer, amongst other things, of electric vehicles, recently announced a plan to expand its operations into Greece.

During their meeting, Hatzidakis and Pyatt also discussed the partnership between Greece, Cyprus and Israel, plus the U.S.

The progress of work at the Greek-Bulgarian IGB gas pipeline, whose geostrategic importance was stressed by the Greek minister, was also addressed. A closer association with Bulgarian contractors is being sought for the project’s punctual delivery.

Work on the Alexandroupoli FSRU in northeastern Greece is progressing at a satisfactory pace, the two officials agreed, noting the project will have a positive impact on geostrategic and energy matters.

The U.S. supplied nearly half of the 2,651,903 cubic meters of LNG imported into Greece in the first half of 2020, almost quadruple the amount supplied by America to Greece during the equivalent period a year earlier.

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.

 

DEPA International Projects, EDEY, the hydrocarbon company, to merge

An amendment permitting a prospective merger between DEPA International Projects – a new entity resulting from a split at gas utility DEPA – and EDEY, the Greek Hydrocarbon Management Company, is now being prepared at the energy ministry, energypress sources have informed.

A number of DEPA-related projects have been added to the DEPA International Projects portfolio, including the Greek-Italian IGI interconnection, EastMed and the Greek-Bulgarian IGB pipeline interconnection.

In addition, any future DEPA-related projects – directly or indirectly – concerning development, construction or management of interconnection infrastructure linking Greece with neighboring countries will also be added to the DEPA International Projects portfolio.

EDEY, the hydrocarbon project licensing authority in Greece, has assets of approximately 12.5 million euros. The company reported a post-tax profit of 4.3 million euros in 2019.

EDEY’s range of activities will be broadened as a result of the company’s merger with DEPA International Projects.

Special categorization for the new company that would exempt personnel remuneration packages and hiring policies from strict state monitoring is likely, sources noted.

The merger plan’s legal details could be attached to an energy ministry draft bill on environmental matters that is expected to be submitted to parliament following the Greek Easter break.

 

Alexandroupoli FSRU market test offers total 2.6 bcm, viability assured

Binding capacity reservations for the prospective Alexandroupoli FSRU in northeastern Greece, whose second-round market test expired on Tuesday afternoon, amounted to 2.6 bcm, a tally that secures the project’s sustainability and paves the way for a finalized investment decision, energypress sources have informed.

Two Greek utilities, gas company DEPA and power company PPC, are among the participants who have reserved capacities, for long-term periods, the sources noted.

Bulgaria’s Bulgartransgaz and a Serbian company also confirmed earlier requests for capacity reservations.

Romania’s Romgaz did not turn up for the market test’s second round after expressing interest for a considerable capacity covering a lengthy period in the first round. Instead, two private-sector Romanian trading companies ended up submitting binding offers for Alexandroupoli FSRU capacities.

The Bulgarian, Serbian and Romanian interest highlights the potential of the Alexandroupoli FSRU to serve as a new natural gas gateway for southeast European markets, via the Greek-Bulgarian IGB pipeline, now under construction, as well as other existing and planned gas pipelines in the region.

Alexandroupoli FSRU project sustainable, reservations show

A second-round market test offering capacity reservations for the prospective Alexandroupoli FSRU in northeastern Greece has drawn enough interest to ensure the project’s sustainability ahead of a final business decision, energypress sources have informed.

The deadline for this market test, a binding procedure, expires today following a ten-day extension granted in order to give Romania’s Romgaz more time to confirm the duration and quantity of its offer.

Romania has entered a period of political crisis after interim prime minister Ludovic Orban’s Liberal Party government was toppled in a no-confidence vote called by the main opposition last month. The coronavirus crisis has worsened the situation. Orban and his entire Cabinet have quarantined themselves after coming into contact with a senator who was later confirmed to have the coronavirus.

Greek gas utility DEPA and power utility PPC have reserved Alexandroupoli FSRU capacities for lengthy periods, the sources added.

Bulgaria’s Bulgartransgaz and a Serbian company are also believed to have confirmed earlier requests for capacity reservations.

The Bulgarian, Serbian and Romanian interest highlights the potential of the Alexandroupoli FSRU to serve as a new natural gas gateway for southeast European markets, via the Greek-Bulgarian IGB pipeline, now under construction, as well as other existing and planned gas pipelines in the region.

RAE given 5 months to set Kavala underground gas storage charges

RAE, the Regulatory Authority for Energy, has been given five months to determine the pricing policy, regulated earnings and WACC for a planned underground gas storage facility at a depleted offshore gas field in the south Kavala region, according to an imminent joint ministerial decision, energypress understands.

The launch date of the project’s tender will depend on funding for project studies through the EU’s Connecting Europe Facility (CEF) program. This essentially means that the privatization fund TAIPED will need to officially launch the project within the first half of this year to avoid missing out on CEF funds.

The project’s investment cost is estimated at between 300 and 400 million euros.

France’s Engie as well as Energean Oil & Gas and GEK-Terna have formed a three-member consortium named Storengy in anticipation of the tender. DESFA, the gas grid operator, is also expected to participate in the tender.

The project, promising gas storage capacity of 360 million cubic meters, is considered vital for Greece as it will be able to maintain strategic reserves for considerable time periods.

Its development will help boost the performance level and strategic role of the Revythoussa LNG terminal just off Athens, and the prospective Alexandroupoli FSRU in the country’s northeast, as these will be able to supply the wider region greater gas quantities via the IGB and TAP gas pipelines.

The south Kavala project has been classified as a PCI project, offering EU funding opportunities, seen as crucial for the investment’s sustainability, according to some analysts.

‘DEPA key to Greece’s leading Balkan role, energy diversification’

Greek gas utility DEPA chief executive Konstantinos Xifaras met earlier today with the U.S. Ambassador to Greece, Geoffrey Pyatt (photo), for a meeting focused on the recent energy-related developments in Southeast Europe as well as on the progress of significant projects in the wider region, currently under way or in design phase, such as the IGB pipeline, the Alexandroupoli FSRU and the EastMed pipeline, a project of strategic importance.

Following the meeting, Ambassador Pyatt remarked: “Greece is a leader in the Balkans in providing energy security and diversification of energy sources, and DEPA is key to its strategy. The U.S. therefore strongly supports DEPA’s participation in major projects that advance this strategy, particularly the Alexandroupoli FSRU, the IGB, TAP and potential EastMed pipeline, which are literally changing the energy map of Europe. These projects are critical for regional peace and security and will make Greece a regional energy hub.”

The DEPA chief commented: “We discussed, with the Ambassador, the course of significant energy projects currently under way in our region, in which DEPA has a leading role.  Over the past months, our company has striven to strengthen its position in the regional energy market, achieving notable cost reductions as well as expanding its activities in new sectors and products. At the same time, we remain focused on the double privatization [DEPA Trade, DEPA Infrastructure] and we are upgrading our participation in these international projects developing Greece into a regional energy hub, safeguarding, at the same time, the diversity of supply sources to the benefit of the country and consumers.”

 

PPC, seeking gas market role, wants 500 bcm at FSRU in Alexandroupoli

Power utility PPC, seeking a strategic role in Greece’s natural gas market, intends to submit a capacity reservation offer to an ongoing Alexandroupoli FSRU second-round market test for approximately 500 million cubic meters per year.

PPC has reached a decision and is preparing to submit its offer within the next few weeks, energypress sources informed.

A capacity reservation at the prospective Alexandroupoli FSRU in Greece’s northeast is crucial for PPC following its recent failure to secure slots in 2020 for the LNG terminal on the islet Revythoussa, just off Athens.

PPC’s Alexandroupoli FSRU interest is driven by two objectives, firstly, to cover natural gas needs at its gas-fueled power stations, and secondly, to trade gas in the wholesale market, like the sector’s other major players. Besides the Greek market, PPC also sees gas trading opportunities in the wider region of southeast Europe.

PPC is determined to establish its place in a sector being transformed by the development of major trans-boundary projects, namely TAP and IGB. Domestically, the Alexandroupoli FSRU and an underground gas storage facility at a depleted offshore gas field in the south Kavala region also offer major potential for PPC.

The Alexandroupoli FSRU market test has generated considerable interest – unofficial until now – seen easily covering terms set to ensure the project’s sustainability before any finalized investment decision is made for development.

Greek gas utility DEPA, now holding a 20 percent stake in the Alexandroupoli FSRU consortium, will definitely seek to reserve capacity. Bulgaria’s Bulgargaz, also a 20 percent shareholder, will participate in the second-round market test seeking an annual capacity of between 300 to 500 million cubic meters, according to a Reuters report.

Many of the first-round market test’s 20 participants, plus a number of new faces, have emerged for the procedure’s binding second round, sources informed.

First round Alexandroupoli FSRU offers more than doubled a total capacity of 5.5 bcm to reach 12.2 bcm.

 

Drastic changes to reshape energy sector by end of 2020

Major developments in Greece’s energy sector, from lignite to natural gas, renewable energy, energy efficiency, as well as the geopolitical effects, promise a drastic reshape of the sector over the next year.

A first batch of power utility PPC’s existing lignite-fired power stations will have ceased operating as part of a plan for a full withdrawal by the end of 2023. PPC will have a reduced number of employees on its payroll. This will have positively impacted the utility’s profit figures.

Also, a first round of major renewable energy projects expected to be launched by PPC subsidiary PPC Renewables through partnerships, as part of the parent company’s wider turn to green energy, will intensify competition in the renewable energy market.

Furthermore, this time next year, assets currently belonging to gas utility DEPA, both in trade and infrastructure, may have been transferred to new owners. This development promises to reshape the entrepreneurial map as the private sector’s dominance will be absolute.

In the retail market, the number of players is expected to have diminished as a result of a new round of takeovers and mergers, amid heightened competition, as was also the case in telecommunications in the recent past.

In addition, Greece’s energy exchange will have clocked up several months of operations by the end of the year. Its arrival will intensify competition, remove market distortions and allow dormant potential to be realized through coupling with neighboring markets.

By the end of 2020, the TAP gas pipeline will have begun delivering its first orders of Azeri gas to Europe, the Greek-Bulgarian IGB gas pipeline will be nearing completion, while procedures leading to the development of the Alexandroupoli FSRU and an underground gas storage facility in the offshore area south of Kavala will have made progress.

Without a doubt, Greece’s energy sector appears to be waking up to the new reality, leaving behind anachronistic perceptions and embracing the green energy revolution. The country is now adopting new ways implemented by the overwhelming majority of European territories two decades earlier.

 

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, pivotal for Greek energy plan, pushing ahead internationally

Through its strategic involvement in an array of pipeline and infrastructure projects, Greek gas utility DEPA is becoming a key driver of Greece’s geopolitical upgrade and the diversification of supply sources for the wider region of South-East Europe.

DEPA is establishing its position in the region through a series of significant international projects such as the acceleration of IGB pipeline construction, participation in the IGI Poseidon pipeline  interconnecting Greece and Italy, and, surely, booking capacity in TAP which, from 2020 onwards, will transport Caspian gas to Europe.

Developments around East Med Pipeline are also rapid, with the most recent being IGI Poseidon’s (the 50% – 50% JV between DEPA S.A. and Edison S.p.A ) BoD decision to fast-track the completion of all pending stages that will bring the project to maturity.  The €70 million Feasibility Study is being accelerated, along with every other stage, to complete the East Med pipeline’s design, which will also pave the way for the final investment decision.

All the above are just one part of DEPA’s multifaceted international activity. Prior to that, in October, a bilateral agreement was signed in Sofia for the start of IGB pipeline construction, a project overseen by ICGB AD, in which DEPA has a 25% stake.

The project is expected to go into operation in July 2021, with an initial capacity of 3 billion cubic meters. At first, the entire load of gas will come from TAP that will go into operation within 2020, delivering Azeri gas to European markets, in which DEPA has booked capacity of 1 billion cubic meters. Thus, through IGB, the company will supply the Bulgarian market with Caspian gas, “breaking” for the first time the existing Russian monopoly.

Another major development took place just yesterday, when the company’s Board of Directors approved the participation of DEPA, with a 20% stake, to the equity of GASTRADE, the company developing the FSRU project in Alexandroupolis.

The Terminal is complementary to the IGB pipeline and consists of an FSRU (Floating Storage Regasification Unit), anchored 10 km off the coastal area of ​​Alexandroupolis, with storage capacity up to 170,000 cubic meters of LNG and 22.7 million cubic meters daily regasification capacity, per day (8.3 billion m3 / year), as well as a 28 km long onshore and subsea pipeline system.

The international presence of the company is also enhanced by the Greek-Italian energy interconnection through the IGI Poseidon pipeline, as well as the CYNERGY program that “breaks” Cyprus energy isolation by establishing a natural gas supply chain in the country.

Apart from its participation in international projects, equally important are the company’s long-term supply contracts with Russian Gazprom, Turkish BOTAS, Algerian Sonatrach, IGSC (Azerbaijan) through the TAP pipeline, as well as the procurement of significant quantities of LNG through the global SPOT market, at competitive prices.

DEPA’s CEO, Konstantinos Xifaras, summed up the company’s international role:

“For thirty years, DEPA has been a leading player in the Balkan energy sector, as well as an integral part of the European strategy for energy diversification and security of supply both of Greece and Europe.

At the same time, by deploying multilayered energy diplomacy and participating in major international projects, DEPA establishes Greece as a regional energy hub and upgrades its economic and geo-strategic importance.”

DEPA’s footprint is solid in the domestic energy market as well, where it recently prevailed in a tender process for natural gas supply to PPC in 2020. The company acknowledged as one of the two bidders, with the ability to supply PPC with 2 million MWh.