By virtue of its geographical
location, the strategy of
Greece
in the natural gas sector is
to contribute to the development of a competitive, liquid market in South East
Europe and to maintain the momentum on energy security as well as the need for
further diversification of sources and routes. For this,
Greece
is supporting projects to function
in reverse-flow infrastructure that will enable gas to be priced at actual
market conditions. As the European Commission noted in its 2011 report on
energy markets “in light of its geographical location, Greece should facilitate
cross-regional projects aiming at market integration and diversification”.
South East Europe (SEE) is the
closest market via Greece, to new sources. Moreover the selection ofTrans
Adriatic Pipeline(TAP) consolidates Greece’s position as Europe’s gateway
for Caspian gas and could boost the development of further infrastructure and
the market. In addition, SEE is a growing market in urgent need of both
diversified sources and the corresponding infrastructure, and it is one of the
regions with the most “catching up” to do, in order to bridge the energy gap
with North West Europe.
With the selection of TAP and the sales agreements concluded between
European gas companies and the Shah Deniz II consortium, the development of the
Southern Corridor is underway. However to be successful, the Southern Corridor
should not only be limited to the markets which are directly on TAP’s route but
also to look at how synergies between existing or planned infrastructure can be
developed in order to enable as many states as possible to have access to
diversified sources of gas. Together with the European Commission, Greece is
promoting cooperation of Member States on the basis of targeted MOU’s. Moreover,
let us not forget that the 10 billion cubic meters coming from Shah Deniz II
represents only 2% of the EU’s demand for gas. Therefore the possibilities for
more supplies, from the Caspian, the Eastern Mediterranean, including possibilities
for indigenous production in Mediterranean Member States, should be further
explored.
It is also expected that theInterconnector
Greece-Bulgaria(IGB) will strongly impact the SEE market and the
Governments of both Greece andBulgariahave recognized it as a
project of national importance. Its regional significance has been reaffirmed
by European institutions which are stead-fast in their support. The Greek
Public Gas Corporation DEPA has entered into a constructive relationship with
the European Bank for Reconstruction and Development regarding financing. The
EU has allocated 45 million euros towards IGB’s realization and the project is
being seriously considered as a Project of Common Interest (PCI). IGB literally
constitutes a gateway, providing access of diversified sources of gas to the
markets of SEE and creates synergies with smaller interconnectors in the region
(eg: Bulgaria-Romania). Also by working in reverse flow it significantly
enhances the region’s energy security. Finally it is ideally located to carry
gas from existing (Revithousa) and planned (Aegean LNG) regasification
terminals in Greece. The project has obtained the necessary environmental
licensing. The Final Investment Decision is scheduled to be taken within 2014. However
IGB is a project which can create synergies with TAP for the benefit of the SEE
region and this should be endeavored.
DEPA is also working on the Aegean LNG terminal (floating storage and
regasification unit). While today only 20% of Europe’s gas supplies are
transported through shipping the EU is now encouraging investments in LNG a
means to boost liquidity. In this context - and having worked with the European
Commission –the Aegean LNG can be selected as a PCI project. The
advantages of this project are that it will facilitate the SEE region’s access
to more LNG capacities (in addition to the LNG terminal in Revithousa) and,
working in conjunction with the IGB, it has the potential to make a real
contribution to the market’s integration and development. The feasibility study
has been completed, the project’s technical feasibility has been established,
the Environmental Impact Study has been awarded and work has recently begun. In
order to benefit from the advantages of a competitive and liquid market which
prevail in North West Europe, the Balkans need to urgently develop
infrastructure to increase market integration and deliver diverse supplies of
natural gas.
Both IGB and Aegean LNG projects are designed to promote this objective
efficiently because this LNG system constitutes a single EU entry point through
which multiple countries may be served and creates synergies with other
infrastructures as well as the Aegean LNG is the closest and least expensive
route to the Greek, SEE and Turkish markets.