Greece Strives for Strategic Role in the Regional Natural Gas Sector
The future plans and ambitions of the Greek state and local corporations was highlighted in the 2nd Balkan Oil & Gas summit that was recently held in Athens. Participants discussed an array of projects to diversify gas supply and integrate the local markets.
The general secretary of the Greek energy ministry, Kostantinos Mathioudakis, stated that one of the most important aspects for the Greek natural sector is the ongoing preparations for explorations both onshore and offshore in the country that will commence according to schedule in late 2014, while preliminary data collection through seismic surveys has already been conducted.
Yannis Grigoriou, General Manager E&P of Greece's largest energy company ELPE (Hellenic Petroleum), pointed out that a story relating to natural gas maybe behind the exploration process. He announced that ELPE have already procured the data base of the surveys by the Norwegian PGS and they are confident of findings, whilst the panel organizer and geologist professor Avraam Zelilides, stated that the offshore Paxos Island region is ideal for some findings. ELPE already collaborates with the Italy's Edison company and the Petroceltic for joint exploration surveys in offshore Western parts of the country, where condensate gas is said to be found.
The director of international projects of the Greek natural gas company DEPA, Konstantinos Karayannakos, elaborates on some other major issues. Karayannakos said that main target of DEPA is to create a competitive southeastern European gas market based on diversity and integration. Moreover, he added that further liberalization of the local markets is needed. The aim is to reduce prices through the future ability of regional gas hubs, such as those present in Northern and Western Europe. In that case the linked to oil-index gas pricing will cease to exist to a great extent and prices will fall, spurring economic growth.
Karayannakos assured participants that the EU also assumes that in the coming years gas prices will diverge from oil price indexes and in the case of the Balkans the markets will become more liquid. The Greek executive mentioned that in light of all of these, the location of Greece is the ideal to implement those changes. Firstly the selection of the Trans-Adriatic Pipeline (TAP) solidifies an alternative gas source in substantial quantities for the local markets and with a steady long-term flow. In addition the Interconnector Greece-Bulgaria (IGB) to be completed by 2015 will enable a flow from Greece up to Hungary through the use of other regional interconnectors and become the first step for market integration on par with diversification. Thirdly the plan by DEPA to establish the so-called Aegean LNG station near the borders with Bulgaria will further boost such strategy combined with the full support as Karayannakos noted of the EU Commission for such projects.
Already the feasibility study for the LNG terminal has been completed and the environmental is underway, while Greece strives to place that project to those of priority by the EU, so as to get funding allocation and access to low interest syndicated loans from organizations such as the European Bank of Reconstruction and Development (EBRD).
DEPA assumes that the non-selection of Nabucco that was negatively seen in the Eastern Balkans (Bulgaria, Romania) can be substituted by the efforts to create synergies in the aforementioned countries by upgrading the capacity of their interconnectors and the establishment of underground gas storage facilities, one of those is being proposed in Greece of around 1 bcm. All of this will be coupled by the assistance of Greece in political and even in corporate level for the Ionian Adriatic Pipeline (IAP) that will be linked with TAP in Albania on its way to Croatia.
Lastly, the Professor Avraam Zelilides in an extensive and decades long geological survey in a region from South Adriatic to East Mediterranean, gave serious hints that the geological plays and some offshore formations of interest could contain natural gas even in similar fashion like those already discovered further East in Cyprus and Israel. Nevertheless he urged caution before any definite answer could be made and ELPE's manager Grigoriou agreed upon by actually rejecting the "hype" in Greece that the country contain trillions of gas offshore, and stated that it will take a few years before any definite numbers can be assessed.