Turkey

Chevron buys Noble Energy, US striving for regional control

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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.

 

Ministry OKs environmental study for blocks south of Crete

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Energy minister Costis Hatzidakis has approved a strategic environmental impact study concerning an offshore area south of Crete in preparation for tenders to offer exploration and production licenses for two blocks covering most of the island’s width.

Giannis Basias, the former head official at EDEY, the Greek Hydrocarbon Management Company, went ahead with the strategic environmental impact study last August to clear the way for government authorities to stage tenders for licenses and also spare  winning bidders of needing to wait for pending issues to be resolved before they can begin their exploration efforts.

In addition, it is believed EDEY took swift action for the environmental impact study covering the offshore area south of Crete in response to interest expressed by oil majors.

The two offshore blocks south of Crete measure a total of 33,933 square kilometers and cover all four prefectures spread across the island.

These vacant blocks are situated next to two blocks southwest and west of Crete that have already been licensed out to a three-member consortium headed by Total with ExxonMobil and Hellenic Petroleum as partners.

The eastern flank of these two blocks is intruded by a corridor defined in a recent Turkish-Libyan maritime deal.

The Greek energy ministry’s approval of the strategic environmental impact study for south of Crete is not linked to Turkey’s heightened provocations in the Aegean Sea, ministry officials told energypress.

The environmental study’s approval means this offshore area is now set for tenders and also sends out a signal of readiness to the international upstream industry, the ministry officials explained.

Just days ago, the newly appointed EDEY administration and the energy ministry’s secretary-general Alexandra Sdoukou met with officials of Total, operator of the consortium holding the two licenses southwest and west of Crete. Seismic surveys for these blocks will be completed by March next year, the Total officials appear to have promised.

Long-standing DESFA northern Greece pipeline plan scrapped

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Gas grid operator DESFA has scrapped plans for a natural gas pipeline that had been envisioned to run across northern Greece, from Komotini in the northeast to Thesprotia in the northwest, after maintaining the project in the company’s business plans for about a decade.

DESFA reached this decision as Russian President Vladimir Putin is supporting Gazprom’s development of a second branch for the wider Turkish Stream gas project, deviating Ukraine, to supply the Balkans and central Europe via Bulgaria, not Greece, as was initially considered.

A first Turkish Stream branch supplying Russian gas to Turkey is already operating.

“The project remained on the business plan for approximately ten years without progressing to the construction stage, while there is no sign of conditions leading to its construction in the immediate future,” DESFA announced.

The Komotini-Thesprotia pipeline project was budgeted at 1.8 billion euros.

The total cost of projects included in DEFSA’s development plan for 2021-2030 is now budgeted at 545.5 million euros.

US backs Greece’s east Mediterranean activities, major projects

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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.

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

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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

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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

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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.

Electricity imports up, gas-fueled power stations running non-stop

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A significant drop in gas prices, especially LNG, as well as the availability of particularly lower wholesale electricity prices in neighboring countries have prompted major changes to the country’s Day Ahead Schedule.

Electricity imports via interconnections with Bulgaria, Italy, North Macedonia and Turkey have risen to represent just under 30 percent of overall consumption.

Demand for an even greater level of imports during certain time periods has not been met as a result of infrastructure capacity limits.

Renewable energy generation, also making considerable contributions to the grid’s needs, has, at times, exceeded 30 percent of total consumption.

Gas-fueled power stations operated by independent producers are now operating around the clock, not just during peak hours, as had previously been the case. Offers by these units are now very competitively priced.

Gas-fueled power stations are currently covering over 30 percent of total consumption and lowering wholesale prices.

On the contrary, power utility PPC’s production is covering smaller amounts of daily electricity consumption. The utility’s contribution, currently slightly over 10 percent, primarily stems from its lignite-fired power stations.

Turkey’s Botas delivers ICC retroactive €200m sum to DEPA

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Turkey’s state-run crude oil and gas company Botas yesterday paid in full a retroactive sum to Greek gas utility DEPA following its recent legal victory at Stockholm’s ICC (International Court of Arbitration) in an overcharging case against the Turkish company, the Greek utility has announced.

The sum paid by Botas to DEPA, believed to exceed 200 million euros, settles a nine-year dispute.

The ICC verdict was delivered on January 10. Botas has since begun transmitting natural gas to DEPA at a lower price level, making the utility far more competitive. Its existing gas transmission contract with Botas expires in 2023.

The dispute began when DEPA claimed the Turkish company was overcharging the Greek utility for its purchases of Azerbaijani natural gas delivered through Turkish pipelines since 2011.

A considerable percentage of the amount paid by Botas to DEPA will be returned to the gas utility’s customers who, by extension, had been overcharged as a result of Botas’ inflated pricing policy. DEPA is expected to be left with a considerable amount, still undetermined.

The development comes as a boost for DEPA, whose privatization procedure has been launched.

“This is very good news coming at the most appropriate time now that the company’s privatization procedure is in progress,” noted deputy energy minister Gerassimos Thomas.

 

Motor Oil wants Corinth FSRU included in DESFA 10-year plan

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Petroleum group Motor Oil wants a prospective FSRU project for Corinth, west of Athens, included in gas grid operator DESFA’s ten-year plan, it has noted in a letter forwarded to RAE, the Regulatory Authority for Energy, as part of a related public consultation procedure.

A floating LNG terminal at Corinth would offer multiple benefits for the natural gas markets of Greece and the wider southeast European region and, therefore, must be included in DESFA’s ten-year plan, Motor Oil supported in its letter.

RAE has already awarded a license for the project but a decision concerning a future capacity commitment at this new national grid entry point has remained pending since last June.

The project is strategically important as a very large proportion of Greece’s current – and near-future – gas imports enter via Turkish territory, Motor Oil pointed out. The Corinth FSRU would further diversify Greece’s supply sources, without geopolitical risks or restrictions, as the facility will be able to absorb supply from anywhere in the world, the petroleum group added.

This FSRU would ease congestion at the existing Revythoussa unit off Athens and contribute to energy supply security, Motor Oil, operating a major refining facility in Corinth, also noted among other factors.

ESAI/HAIPP, the Hellenic Association of Independent Power Producers, has also expressed support for the Corinth FSRU, noting, in its letter, the facility would offer a new gas grid entry point, desaturate Revythoussa and help offer more competitively priced natural gas to the Greek market.

Athens wants greater French hydrocarbon engagement

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The government wants France’s Total to play a more active role in Greek offshore hydrocarbon exploration, Prime Minister Kyriakos Mitsotakis made clear during a meeting in Paris yesterday with the French group’s chief executive Patrick Pouyanné.

The potential of Greece’s hydrocarbon market, including offshore licenses south and southwest of Crete held by a Total-led consortium – it also features Exxon Mobil and Hellenic Petroleum (ELPE) – was the main focus of yesterday’s meeting.

Processing of seismic data collected from the Cretan offshore blocks has provided strong evidence of a deposit sharing similar attributes to Egypt’s Zohr gas field. However, this needs to be proved in practice. French officials have remained cautiously optimistic as they await initial drilling operations for a clearer picture.

Total’s plans for exploration within the Cypriot Exclusive Economic Zone, specifically at Block 8, for which Total shares a license with Italy’s Eni, were also discussed yesterday.

Turkish drillship Yavuz has sought to engage in illegal exploration activities in this area. French officials do not intend to intercept any Turkish moves at this stage but are expected to do so if the exploratory rights of Total and Eni are disputed once the companies decide to start exploring the area.

 

DEPA wins Botas case at ICC, retroactive cash boost expected

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The ICC (International Court of Arbitration) has issued a favorable verdict for gas utility DEPA in a case against Botas, Turkey’s state-run crude oil and gas company, challenging price increases of Azerbaijan natural gas supplied to Greece by the Turkish firm since 2011, the Greek gas utility has announced.

DEPA took its case to the ICC seeking to have a previous ruling overturned. The resulting retroactive cash inflow for the Greek gas utility could be close to 200 million euros. Also, the ICC decision will secure DEPA a lower supply price from now on, enabling a favorable revision of the gas utility’s prices offered to customers.

The legal dispute between DEPA and Botas stretches back to 2008 and has produced a variety of intermediate situations and verdicts.

The latest round was initiated in August, 2016 when DEPA submitted a price-revision request to Botas for a lower gas supply price.

East Med pipeline to upgrade geostrategic role of participants

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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.

East Med, IGB, Alexandroupoli FSRU upgrading Greek role

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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

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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.

Greek-Cypriot-Israeli energy summit highlights US interest

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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.

New EU warning for Turkey over Cyprus EEZ violations

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The EU’s 28 are set to issue a new warning to Turkey today in response to the country’s illegal hydrocarbon exploration activities within Cyprus’ Exclusive Economic Zone (EEZ), diplomatic sources have informed.

EU governments are expected to vow to freeze negotiations over the modernization of the customs union between the bloc and Turkey, while reiterating that accession negotiations have come to a standstill.

The EU-28 will also signal that further escalation is possible, as the EU “stands ready to respond appropriately and in full solidarity with Cyprus,” if drilling activity continues.

The statement, due to be approved by the EU’s European affairs ministers today, is subject to ongoing deliberations between diplomats and the final wording may change.

Greek Prime Minister Alexis Tsipras said on Sunday that he may demand EU sanctions against Turkey over drilling activities.

Ankara is disputing Nicosia’s EEZ rights as Cyprus prepares to drill at offshore gas reserves in the Eastern Mediterranean. Turkey has sent exploration vessels in the area, with Cyprus protesting a violation of its sovereignty.

PM: Greece still working on Turkish Stream extension plan

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Greece has not stopped working on the prospect of extending the Turkish Stream gas pipeline westward through northern Greek territory – for an Adriatic Sea crossing and gas supply to southern and central Europe – Prime Minister Alexis Tsipras noted during a speech delivered at the recent Thessaloniki Summit.

The Russian pipeline’s development all the way to Turkey’s European tip in the country’s northwest has been completed, thereby linking the gas systems of both nations, and will be marked by a ceremony today to be attended by Russian President Vladimir Putin and his Turkish counterpart Recep Tayyip Erdogan.

Its 15.75-billion cubic meter capacity is 50 percent bigger than the TAP project.

Turkish Stream constitutes an alternative route for Russia following EU objections and the eventual debacle, in 2014, of South Stream, another gas transmission project that was planned to reach Bulgaria. The follow-up Russian plan anticipates a westward stretch from Turkey’s European tip to the Greek border, followed by an Adriatic Sea crossing. Officials are contemplating combining the pipeline with the IGI project.

ExxonMobil drillship nearing for Cyprus venture amid heightened tension

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US energy giant ExxonMobil, in a collaborative effort with Qatar Petroleum, is preparing to launch exploratory drills at Block 10 in Cyprus’s Exclusive Economic Zone (EEZ) amid heightened military activity in the region.

Hydrocarbon experts have increased the likelihood of Block 10, southwest of Cyprus, carrying significant reserves.

An ExxonMobil drillship, Stena Icemax, capable of drilling in water depth up to 3,000 meters, embarked on its cross-Atlantic journey on October 29 and is reportedly scheduled to arrive at Limassol port on November 12, where personnel for the drilling venture will board the vessel before it heads out to Block 10 to commence work.

A Navtex international automated warning system, whose applications include global maritime distress safety, has been programmed by Cyprus to monitor parts of the island nation’s EEZ areas concerning the upcoming drills.

Turkey has heightened its mobilization in the wider region, suggesting it will bargain hard to promote its hydrocarbon interests in the wider Middle East region.

Less than a fortnight ago, Turkish naval forces accompanied the neighboring country’s Barbaros survey vessel within Cypriot EEZ territory and, in addition, have also joined the Turkish drillship Porthitis (Fatih) for deep-sea drilling operations north of Cyprus, reported to have begun.

The upcoming exploration work and possible hydrocarbon production in the Cypriot EEZ could change the Cypriot balance. The Turkish occupation of the island’s north has prevented Cyprus from utilizing its natural wealth since the Turkish invasion of the island in 1974.

DESFA, Botas working on deal to liberalize Greek entry point

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Greek gas grid operator DESFA and Turkish state-run crude oil and gas company Botas are working on an agreement concerning the Kipous grid interconnection in Evros, at Greece’s northeastern tip, which would enable third parties, in addition to Greek gas utility DEPA, to use the link as an entry point for natural gas imports.

DESFA has already reached an equivalent agreement with Bulgarian operator Bulgartransgaz for the gas grid interconnection at Sidirokastro, by the Greek-Bulgarian border. Subsequently, since 2017, five new firms besides DEPA, until then Greece’s only natural gas importer from this entry point, have brought gas quantities into the local market via the Sidirokastro link.

DEFSA and Botas have now been engaged in talks over the matter for several months. It is unclear how much more time will be needed for an agreement.

Their negotiations are focused on technical measure-related issues and a reverse-flow agreement that would also enable gas outflow from Greece to Turkey.

US drillship in Cyprus may reignite Greek-Turkish tension

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US energy giant ExxonMobil plans to conduct its first offshore drilling venture at block 12 in Cyprus’s Exclusive Economic Zone (EEZ) within the next few weeks as part of its hydrocarbon exploration effort in the region, sparking fears of renewed Greek-Turkish tension. An ExxonMobil survey vessel is scheduled to arrive at the block on September 28.

Though Greek-Turkish tension has deescalated in recent times, the exploratory work planned by ExxonMobil, as well as France’s Total, in Cypriot waters, could spark new tension between the neighbors, pundits believe.

Regardless of the ongoing developments concerning Turkey’s economic crisis, the upcoming exploration work and possible hydrocarbon production in the Cypriot EEZ could change the Cypriot balance, which has prevented Cyprus from utilizing its natural wealth since the Turkish invasion of the island in 1974. Turkey will most likely be prepared to use force to prevent Cyprus from utilizing this anticipated wealth.

Turkey has already sent a drillship and four support vessels to the Mediterranean to start the country’s first deep-sea drilling operations. There are concerns that tensions in the region could flare up if the Turkish vessel, Porthitis (Fatih), begins drilling off the coast of Cyprus, where Nicosia has already granted exploration licenses to foreign companies.

Turkey says it will prevent Cyprus from searching for gas and oil off its coast if Turkish Cypriots are not included in the process.

Tensions between Greece and Turkey reached breaking point in February after Turkish warships prevented a rig of Italian energy giant ENI from drilling in block 3 of Cyprus’s EEZ.

US officials have asked Ankara to keep away from ten areas and also urged for a Turkish commitment ensuring smooth proceedings in the exploratory work planned within the Cypriot EEZ.

“Naturally, in diplomacy, you name 10 areas so that the other side may back away from some of these,” one pundit told energypress.

Any normalization of Greek-Turkish relations will be temporary and restricted to this week’s repatriation of two Greek soldiers who were released from a Turkish prison following months of captivity, pundits have stressed. The normalization is not a long-term condition, they noted, citing the upcoming hydrocarbon exploration plans in Cyprus’s EEZ.

 

 

 

JinkoSolar completes giant Turkish solar farm with Asunim

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JinkoSolar, a global leader in the solar PV industry, has completed its development of a solar power plant in Manisa, west Turkey, the largest such facility in the wider region, in cooperation with Asunim Turkey, a leading PV project developer and EPC company, JinkoSolar has just announced in a statement.

Asunim is currently one of the leading EPC companies in Turkey and has so far completed projects of 140MW.

The dedicated international engineering team of Asunim has a long track record of successful systems design and implementation, using cutting-edge 3D modelling and simulation software to correctly detail extremely important shading and counter slope calculations, JinkoSolar noted in its company statement.

The Manisa solar power plant consists of two separate sites with a total production capacity of 40.3 MW. One unit offers 19.7MW and the other 20.6 MW. The systems feature JinkoSolar high-efficiency (PID free) solar modules and REFUsol 40K string inverters operating without the need for fan cooling and with full IP65 protection against humidity and dust.

The German company Solar-Log was chosen for the project’s SCADA system. Operation and maintenance activities will be covered by Maxima Energy, an affiliated but independent O&M Company of Asunim.

“Installing a project on a flat terrain is easier when compared to sites with different slopes. In order to get the highest yield several different studies and calculations were made for this challenging project,” noted Umut Gürbüz, managing partner of Asunim Turkey.

“We are extremely pleased to see this contract as an outcome of our steadily growing successful partnership with Asunim Turkey over the last years. Asunim Turkey, as a trusted local partner, shares and follows the same highest product and service quality levels that we also apply at JinkoSolar, globally, which makes us stronger and helps us maintain our leadership position in the market,” remarked  Gener Miao, Vice President, Global Sales and Marketing of JinkoSolar.

 

PPC eyeing Fyrom, Albania, Turkey to offset local retreat

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

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

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

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

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

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

 

 

PPC eyeing Turkish lignite deposit and unit development for needed revenue

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The main power utility PPC is looking to acquire the development rights for a power station in Turkey’s Eskisehir area, in the northwest, with Chinese firm Shenhua as the investment’s partner, the utility’s chief executive Manolis Panagiotakis revealed yesterday during a speech delivered at the American-Hellenic Chamber of Commerce’s annual “Greek Economy Conference”.

PPC has unsuccessfully sought to enter southeast European markets over the past 14 years, both alone and with partners.

The Eskisehir area is home to Turkey’s third largest lignite deposit. Panagiotakis noted that becoming a “regional leader is a strategic choice” but did not elaborate any further on this plan.

According to Turkish media, Eskisehir lignite deposits currently controlled by the Electricity Generation Company Inc (EUAS), Turkey’s largest power company, and a development plan for the construction of a 1,080-MW power station in the area represent part of a privatization plan.

Interested parties face a January 26 deadline to submit offers to an international tender offering Eskisehir deposits with a condition for development of a 1,080-MW power station, according to Turkish media. The winning bidder will be able to sell electricity generated at the location to the national grid at a minimum price of 5 to 6 dollars per KWh, local media has reported.

Previous attempts by PPC to enter southeast European markets, none of which were successfully completed, have included an attempt to acquire the Bobov Dol power station in Bulgaria in 2003, a Negotino facility in the Former Yugoslav Republic of Macedonia (Fyrom) in 2007, as well as ambitious expansion plans with Germany’s RWE in 2009.

Last year, PPC, joined by China’s CMEC as its partner, was planning another attempt, but a breakdown of an endeavor by the two firms to co-develop a Meliti II power station in Greece appears to have also swept aside their joint plan for expansion into southeast Europe’s wider region.

Facing a drastic revenue reduction in the near future as a result of a bailout-required market share contraction in the Greek retail electricity market, from roughly 88 percent at present to 49 percent by 2020, PPC desperately needs to penetrate regional markets and offset the anticipated losses to remain afloat.

 

DEPA appeal against Botas for retroactive hike starts today

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An ongoing gas price dispute between DEPA, the Public Gas Corporation, and Botas, Turkey’s state-run crude oil and gas company, will continue at a Stockhom court, where the case was transferred today.

DEPA filed this case against Botas in an attempt to have a previous ruling favoring the Turkish energy company lifted. The verdict, which vindicated a retroactive gas price increase by Botas for its Azerbaijani gas supply, called for a 180 million-euro payment by DEPA to Botas.

The case goes back approximately ten years when Botas had demanded a retroactive payment – from 2008 onwards – of 300 million euros for various natural gas pricing discrepancies. DEPA refused to pay this sum. Ensuing negotiations failed to deliver results and Botas took legal action in 2011.

Though the Turkish company’s demand for a 300 million-euro payment was reduced to 180 million euros by this court decision, DEPA still considered the sum to be excessive. Even so, the payment was completed in September, 2016 but DEPA followed up with an appeal at the Swedish court. This appeal case begins today.

It is not the only pending legal case submitted by DEPA against Botas. Last July, the Greek gas utility took legal action against Botas seeking a retroactive price revision to a contract signed by the two sides for Azerbaijani gas supplied to DEPA.

This case, submitted to the ICC in Paris, is based on two requests made by DEPA to Botas for price revisions, the first in 2011 and the second in 2016.

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DEPA payment case against Botas to be heard this month

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A legal case filed by DEPA, the Public Gas Corporation, against Botas, Turkey’s state-run crude oil and gas company, in an attempt to lift a previous ruling in favor of Botas, which had called for an 180 million-euro payment to the Turkish enterprise for various natural gas pricing discrepancies between the two sides, is expected to be heard before a Swedish court in two to three weeks.

Botas had demanded a sum of around 300 million euros in retroactive payments for outstanding amounts resulting from various natural gas price revisions as far back as 2008. DEPA rejected the claim, prompting Botas to take legal action in 2011.

The Turkish company was partially vindicated by the court decision, which issued an order for DEPA to pay 180 million euros. However, the court excluded the year 2008 from its calculations of the sum to be paid.

The Greek gas company completed this payment in September, 2016, but then opted to file a case against Botas last year in an attempt to have the payment ruling cancelled. If DEPA wins this case, then Botas would need to return part of the 180 million euros it has received from DEPA.

It is not the only pending legal case submitted by DEPA against Botas. Last July, the Greek gas utility took legal action against Botas seeking a retroactive price revision to a contract signed by the two sides for Azerbaijani gas supplied to DEPA.

This case, submitted to the ICC, is based on two requests made by DEPA to Botas for price revisions, the first in 2011 and the second in 2016.

DEPA, which has sought a price reduction since 2003 for Azerbaijani natural gas supplied by Botas, decided it had no other choice but to take legal action. A hearing for this case is still a long way off.

PPC preparing for new attempt to penetrate Balkan markets

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PPC, Greec’s main power utility, is preparing to make a new attempt at penetrating the Balkan market, the corporation’s chief has told the recently launched weekly Nea Selida.

As part of the effort, the utility plans to participate in an upcoming international tender offering two hydropower facilities in Turkey, while similar moves are being planned for the Albanian market, according to PPC chief executive Manolis Panagiotakis.

The power utilty’s entry into the wider Balkan market, gaining pivotal importance as the EU energy market moves towards full intergration, is imperative for the Greek corporation’s future, Panagiotakis stressed in the interview.

PPC is aiming to heighten its activity in the Turkish market by establishing synergies with enterprises in the neighboring country, Panagiotakis noted without elaborating further.

Many pundits believe that PPC will seek to penetrate the Balkans with the backing of Chinese business partners. For quite some time now, the Greek utility has made clear its anticipation of and reliance on Chinese capital as a key towards entering Balkan markets following unsuccesssful attempts going back over a decade.

PPC made its first attempt in 2003 when it sought to enter the Romanian market. A series of other efforts ensued, all proving unsuccessful.

Albania, where PPC has established a subsidiary, needs to have its network developed, while thermal units also need to be constructed as the country’s network is heavily reliant on hydropower facilities.

 

Additional court dispute between DEPA, Botas now awaiting verdict

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DEPA, the Public Gas Corporation, is awaiting an ICC (International Court of Arbitration) ruling on a case filed last month against Botas, Turkey’s state-run crude oil and gas company, challenging price increases of Azerbaijain natural gas supplied to Greece by the Turkish firm. Two legal disputes between the firms are now pending.

DEPA’s new legal case has requested an examination of natural gas price increases made by Botas in 2011 and 2016, following its alleged disregard of international market condition changes as of 2009.

DEPA is hoping for a reduction in the price of Azerbaijani natural gas supplied by Botas, which has delivered gas to the Greek market since 2003. The Greek gas company’s decision to take its case to the ICC was seen as the only remaining option following previous efforts to resolve the pricing dispute.

A court decision concerning an older dispute between the two sides is also pending.

The latest dispute is rooted in a Botas demand imposed on DEPA for a return of a 300 million-euro sum concerning price revision differences from as far back as 2008. DEPA  refused to pay this amount, prompting Botas to take legal action in 2011.

The Turkish firm was partially vindicated as the court set the amount to be returned by DEPA at just under 200 million euros. DEPA appealed this decision in 2016.

 

 

 

 

PPC, facing local contractions, eyes hydropower, RES units in Turkey

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Facing bailout requirements leading to electricity market share contractions, at production and retail levels, the main power utility PPC is seeking to increase its presence abroad, including in Turkey, a market possessing particular interest for the utility, especially its hydropower and RES sub-sectors.

The efforts of PPC Elektrik Tedarik ve Ticaret Anonim Sirketi, PPC’s wholly owned subsidiary in Turkey, will be pivotal in the utility’s Turkish market aspirations.

The recent appointment of PPC Renewables managing director Ilias Monaholias as the Turkish subsidiary’s deputy chief reflects PPC’s intentions in the neighboring market.

PPC is moving fast in its effort to gain a presence in the Turkish market. Earlier this week, the Greek power utility’s board endorsed PPC Elektrik’s business plan for 2017 to 2019, including its participation in a tender concerning Turkey’s Manyas hydropower facility (photo).

The 20-MW capacity Manyas facility is one of ten Turkish hydropower plants EUAS, the state power utility, plans to privatize. Their overall capacity amounts to 256.4 MW. Bidders face an August 21 deadline for the tender offering the Manyas hydropower unit, located in the Marmara region.

It remains to be seen whether PPC will submit new bids for the Menzelet and Kilavuzlu units, possessing respective capacities of 124 MW and 54 MW and included in Turkey’s sale package of ten hydropower units.

Both these facilities were also put up for sale through unfinalized tenders last year. PPC had taken part in both sale prodecures. No reasons were announced for their interruption.

PPC is also exploring investments in Turkey’s RES sector, currently experiencing robust growth. “Our objective is not only the exchange of knowhow, but, primarily, the penetration of PPC Renewables into new emerging markets,” noted Monaholias, the PPC Renewables chief, adding that an extremely ambitious investment plan has also been prepared for the Greek market.

 

 

Cyprus drilling, now started, prompts flurry of diplomatic, military activity

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The West Capella drilling ship hired by a consortium comprised of Total and Eni launched its exploration work at Block 11 in Cyprus’s Exclusive Economic Zone (EEZ) last Wednesday, as was scheduled, amid heightened diplomatic and military activity, as anticipated by the Cyprus government.

Turkey has made clear its intentions to escalate the tension amid the intensifying competition for natural gas and other interests in the region.

The West Capella drilling ship, which has reached Block 11’s sea bed, at 1,698 meters below sea level and on a slight angle towards the southwest, has been given a 21 percent chance of discovering a natural gas field, a relatively high probability rating. Drilling is expected to reach 2,230 meters. The initial results are expected to be determined by mid-September.

As a result of Total’s involvement, France is keeping a close watch on the overall developments. The country’s defense minister Florence Parly, expected in Cyprus today, will visit French frigates that initially arrived in the wider area to contribute to the United Nations Interim Force in Lebanon (UNIFIL) before being moved to Larnaca, on the southern coast of Cyprus, over the past few days.

The visiting French defense minister, who is scheduled to hold talks with her Cypriot counterpart, Christoforos Fokaidis, may also visit Total’s drilling platform.

Besides the French frigates, Cypriot, US and Greek forces have also been deployed to protect the drilling activity and Total’s interests. The region already represents a crucial launching pad for operations in Syria and Iraq.

French President Emmanuel Macron is keeping an open line of communication with the Cypriot government. In addition, Cyprus’s Foreign Minister Ioannis Kasoulidis recently traveled to France for an official visit.

Making the current hydrocarbon exploration activity in Cypriot waters even more complicated, the West Capella drilling ship arrived to the country’s EEZ just days after the breakdown of the latest UN-backed Cyprus reunification talks.

In the lead up to the drilling at Cyprus’s Block 11, a US State Department official declared that the US recognizes Cyprus’s rights to develop sources within its EEZ, adding that Washington will continue to discourage any actions that may escalate tension in the region. This statement has been interpreted as a show of support for the Cypriot government and Total. Many pundits have linked the US support to the prospective interests of US energy giant ExxonMobil in Cyprus and Greece.

The State Department official also added that the US continues to believe that Cypriot oil and natural gas revenues need to be shared fairly between the divided island’s Greek and Turkish communities.

The Cypriot govermnent has declared that Turkey’s aggressive response comes as no major surprise. Fokaidis, the Cypriot defense minister, stressed there is no reason for alarm, adding that “the sooner we stop being involved with what’s happening at the drilling rig the better.”

However, he also admitted the situation is being closely monitored, adding that Cypriot officials are implementing plans they have been trained to implement, cooperating with all interested parties, and remaining focused – seriously and calmly – on the national objective, which is “to fulfil our energy plans.”