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.

 

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.

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.

 

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.

 

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.

IGI Poseidon in talks with Israeli firms for East Med agreements

The IGI Poseidon consortium, a 50-50 joint venture between Greek gas utility DEPA and Italy’s Edison, is engaged in talks with Israeli companies for direct and indirect involvement in its East Med gas pipeline project, planned to transport gas from Israeli and Cypriot fields to Europe via Greece and Italy.

DEPA and Edison are holding talks with Israel Natural Gas Lines Company, Israel’s gas grid operator, which could lead to a stake in the project for the latter, energypress sources have informed.

If these talks come to fruition, then the East Med project’s planned route, covering 2,000 km, will have made an import step towards actualization, securing gas transmission from the Levantine gas field, off the coast of Israel.

Besides its talks with Israel Natural Gas Lines Company, IGI Poseidon signed a Memorandum of Cooperation on December 2 with Tahal group member TMNG, a leading Israeli natural gas EPC company serving as a one-stop shop for natural gas and oil-related projects. This agreement concerns the development of an investment plan for exports of Israeli natural gas quantities to Europe.

However, much work is still needed before the aforementioned deals, or others, begin offering benefits, officials have stressed.

A period of at least two years will be needed before a finalized investment decision can be taken, according to the IGI Poseidon board, which recently approved funding worth 70 million euros for project-maturity studies.

 

IGB bilateral agreement for construction start to be signed in Sofia

A Greek-Bulgarian bilateral agreement enabling the commencement of construction work on the IGB gas grid interconnector is set to signed in Sofia during a two-day meeting scheduled for October 9 and 10.

Complementary agreements concerning the project, the most significant of these being a shareholders’ agreement and a loan agreement with the European Investment Bank (EIB), will also be signed by officials over the two days.

The Greek-Bulgarian pipeline project, measuring 182 kilometers, will link Komotini, in Greece’s northeast, with Stara Zagora. It will serve as a second interconnection point for the Greek and Bulgarian gas systems, in addition to an existing station in nearby Sidirokastro.

The new project, to offer an annual capacity of 5 billion cubic meters, will commence operating at a lower level of 3 billion cubic meters.

The IGB pipeline is planned to be linked with TAP, running across northern Greece. Combined with the Bulgaria-Romania and Bulgaria-Serbia interconnections, the IGB will contribute to the establishment of the vertical corridor through the Balkans and connect central Balkan countries with Caspian gas and the TAP pipeline.

IGB’s planning, construction and operation has been taken on by ICGB, the project’s Sofia-based consortium, a 50-50 joint venture representing the state-controlled Bulgarian Energy Holding (BEH) and IGI Poseidon, involving Greek gas utility DEPA and Edison.

IGI Poseidon licensing procedures ‘ready by summer’

The prospective IGI Poseidon gas pipeline, planned to run though Greece’s north and across the Adriatic Sea to Italy as a supply route for Russian gas to Europe, is expected to be fully licensed by the summer, energypress sources have informed.

Regarded as an investment plan of major global interest, IGI Poseidon is now at the public consultation stage after years of preliminary work.

Its developers, the Greek gas utility DEPA and Italy’s Edison, are currently staging a public consultation procedure on the project’s environmental impact study. Interested parties have until March 27 to submit their views.

The Poseidon company intends to make final investment decisions once all licensing and market test procedures have been completed.

DEPA, Edison and Gazprom have signed a memorandum of cooperation to explore the possibility of the project’s link with Turkish Stream, planned to transmit Russian gas to the Greek-Turkish border. Officials are now also looking into whether the pipeline can be connected with East Med, to link the Greek, Cypriot and Israeli systems, and the Greek-Bulgarian IGB route.

IGI Poseidon gas pipeline prospects on PM’s Moscow visit agenda

The development prospects of an IGI Poseidon gas pipeline though Greece’s north and across the Adriatic Sea to Italy as a supply route for Russian gas to Europe, a plan opposed by the US, is expected to be on the agenda of a meeting between Greek Prime Minister Alexis Tsipras and Russian President Vladimir Putin scheduled for December 7 on Moscow.

The majority of license-related procedures needed by Greek gas utility DEPA and Italy’s Edison for the IGI Poseidon gas pipeline have been completed, the two European firms informed Russia’s Gazprom at a recent three-way meeting in Moscow.

The IGI Poseidon gas pipeline is envisaged to serve as an extension of Turkish Stream.

DEPA and Edison officials are confident a gas pipeline route through Greece, rather than Bulgaria, as suggested by Moscow on occasions, carries definite advantages.

The Greek-Italian pipeline is technically mature as 80 percent of studies have been completed, while license applications have been submitted to energy sector regulatory authorities and Brussels, DEPA and Edison officials informed during their Gazprom meeting.

However, as was made apparent at this three-way meeting, all sides remain concerned as to whether the European Commission will raise objections against the pipeline plan. Washington is pressuring EU member states to find alternative natural gas supply sources not involving Russia.

In Greece, US ambassador Geoffrey Pyatt is taking every opportunity to express America’s opposition to any further penetration by Gazprom of Greece’s energy sector.

Greek energy minister Giorgos Stathakis recently appeared hesitant on the prospect of a new pipeline to transmit Gazprom gas.

Much will depend on the outcome of an upcoming official US visit by Greece’s Alternate Minister of Foreign Affairs Giorgos Katrougalos between December 11 and 14. He will be joined by the energy ministry’s secretary general Mihalis Veriopoulos. DEPA and Edison will be waiting for political decisions concerning their Greek-Italian pipeline investment plan.

 

Snam, DESFA weighing their regional pipeline options

Italy’s Snam and DESFA, Greece’s natural gas grid operator, are examining their options for transportation of gas from the Greek-Turkish border to Italy’s Salento peninsula in the southeast.

Currently staging a public consultation process to gather observations and proposals – it expires on December 18 – Snam and DESFA, brought closer by an ongoing international tender offering 66 percent of DESFA in which Snam is participating, are looking at developing a plan that would enable them to use both TAP and the IGI Poseidon so as to transport both Azerbaijani and Russian gas to Europe via Turkey, Greece and Italy.

The TAP pipeline, now under construction, is designed to transport gas from the giant Shah Deniz II field in Azerbaijan to Europe, through a route crossing Greece, Albania and the Adriatic Sea, before coming ashore in Southern Italy. The IGI Poseidon, a plan by Gazprom, Edison and DEPA (Public Gas Corporation) is intended to transport natural gas from the Caspian and Russia towards Europe.

Snam and DESFA are also examining the construction of a new gas pipeline should the aforementioned combination not work.

This other gas pipeline would include include compressor stations in Evros and Komotini in Greece’s northeast, a 613-km submarine crossing from Greece to Italy, aand interconnection with the existing network on Italy’s mainland. The project’s budget has been estimated between 2.5 and 4 billion euros.

Snam is part of a consortium also including Spain’s Enagas, Belgium’s Fluxys and Dutch operator Gasunie that has submitted a bid for a 66 percent stake in DESFA, offered through a renewed tender.

Snam, which holds a 20 percent stake in the TAP (Trans Adriatic Pipeline), appears to be eyeing the wider region, not just the local market. The Italian company seems to believe in the promise offered by the southeast European market, until recently not a key part of plans set by major European corporations.

A recent article published by Italian newspaper Nuovo Quotidiano di Puglia explained that between three and four different pipelines could reach the Salento peninsula within the next two to three years and, from there, serve the entire continent. This is an important part of Snam’s planning.

The approval of an EU term permitting cross-boundary gas transportation has encouraged the Italian firm to further develop its plans.

‘Turkish Stream’ supported if in line with EU law, minister says

Greece will support a Russian energy investment plan concerning “Turkish Stream”, a natural gas pipeline plan that would transmit Russian gas to Europe via Turkey, Greece – it is dubbed “Greek Stream” for its Greek segment – and Italy, as long as the plan complies with EU law, energy minister Giorgos Stathakis appears to have told his Russian counterpart, Alexander Novak, at a meeting on the sidelines of Russian Energy Week 2017, an ongoing conference in Moscow and St Petersburg.

Acknowledging the Russian project’s significance, Stathakis discussed its next steps with Novak and relayed the Greek government’s support through the development and incorporation of IGI Poseidon pipeline, an older plan envisaged to transport Russian natural gas from Greece to southern Italy via a submarine Adriatic Sea crossing. IGI Poseidon is fully licensed for development.

The Greek energy minister reportedly underlined that, ultimately, it would be up to Brussels to decide on whether the pipeline plan can proceed.

 

 

Italy persisting with Poseidon plan despite US objections

Despite US concerns, Italy, citing the support of Brussels, is persisting with a plan aiming for the development of the IGI Poseidon pipeline, an older plan envisaged to transport Russian natural gas through Greece to southern Italy via a submarine Adriatic Sea crossing. This project would also incorporate Greek Stream, a pipeline option planned to run from the Greek-Turkish border. It is also referred to as Turkish Stream for its Turkish segment.

Highlighting Italy’s interest, the IGI Poseidon pipeline was included in a Greek-Italian declaration of cooperation signed yesterday between Prime Minister Alexis Tsipras and his Italian counterpart Paolo Gentiloni at a meeting on Corfu.

Italy, which has reached a series of agreements in recent times in support of the Poseidon pipeline – beginning with a memorandum of understanding signed in March between Eni and Gazprom for Russian gas supply via the Southern Corridor – contends that the project will not increase Russian gas supply to Europe. The objective, Italian officials support, is to relocate the delivery point of Russian natural gas from Italy’s north, via Austria, to the country’s south, seen as a lower-cost route.

The US may not favor this Russia-linked option but Italian officials are adamant as they believe that the TAP pipeline – currently being constructed to transport natural gas from the giant Shah Deniz II field in Azerbaijan to Europe via Greece’s north, Albania and across the Adriatic Sea to Italy – cannot satisfy Italy’s energy needs, both in terms of quantity and cost. In addition, the submarine IGI Poseidon plan is already fully licensed from the past.

Just days ago, the US Ambassador to Greece, Geoffrey R. Pyatt, speaking at a conference in Alexandroupoli, northeastern Greece, criticized Russia for increased meddling in the Balkans. The US is increasingly viewing Greece as crucial in its effort to counter Moscow’s dominance in southeast Europe.

 

East Med pipeline will meet all prerequisites, Canete supports

European governments and the Israeli administration today pledged full support for the development of the East Med project, designed to transmit natural gas along a route stretching from Israel to Europe.

An objective has been set for the pipeline infrastructure project to be ready by 2025. The East Med project is planned to measure some 2,000 km and connect Israeli and Cypriot natural gas deposits with Greece and possibly Italy. The project’s budget could reach as much as 6 billion euros.

“This is an ambitious project that is clearly supported by the European Commission as it carries tremendous value with regards to supply security and the objective for diversification,” noted the European Commissioner for Climate Action and Energy Miguel Arias Canete.

Following a meeting with the energy ministers of Israel, Cyprus, Greece and Italy, Canete told reporters he believes the East Med project will meet all prerequisites to enable financial commitment.

Israel’s energy minister Yuval Steinitz noted that the pipeline project could be ready by 2025. “But we will try to speed up and shorten this timeline,” Steinitz informed. Asked about Israel’s energy plans, Steinitz responded: “I will develop both pipelines,” referring to East Med and an Israeli-Turkish pipeline.

Elio Ruggeri, CEO of IGI Poseidon, the owner of the East Med project, told Reuters that, according to the current budget, the project is estimated to cost 5 billion euros to reach Greece’s gas network and 6 billion euros to reach the Italian system.

IGI Poseidon is a joint venture formed by DEPA, Greece’s Public Gas Corporation, and Italian energy group Edison.

The energy ministers of all East Med project participants said they plan to meet in Cyprus six months from now to discuss the pipeline’s further development.