Greece Considers LNG Option

The Greek natural gas sector, and in particular the public natural gas supply corporation DEPA, is examining at length the possibility of boosting its local and regional LNG market, according to recent presentations announced in Athens at the 2nd International Conference on Energy & Shipping, which was focused mainly on the LNG industry worldwide.

Spyros Paleogiannis, Vice President of DEPA, said that LNG trade is one of the mid to long-term priorities for DEPA, which aims to use Greek territory as an import-export springboard for such trade in the region and beyond. 

DEPA is drafting plans on how to expand the use of LNG and CNG to cover Greece's extensive Island communities by creating several terminals for gas consumption.

An important part is the supply to the Island of Crete via a Floating LNG terminal of around 150,000 cm of capacity, so as to replace the needs of the power station company that are currently being met by expensive oil imports. Crete has a permanent population of 700,000 people and accommodates more than 4 million tourists, having considerable energy needs which can be covered via natural gas, a cheaper and more environmentaly friendly fuel than oil.

Another plan maturing in Greece is the construction of the Aegean LNG terminal in the Kavalla port in the northern part of the country, close to the borders of both Turkey and Bulgaria. The plan calls for a 180,000 cbm of capacity with a price tag of around €500 million, aimed primarily at neighboring markets. DEPA, along with most major Greek shipping companies are expecting a further boost of worldwide LNG trade and also estimate that by 2020 around 1,000 maritime commercial vessels will operate with LNG fuel, thus creating a need for LNG refuelling stations across major maritime routes.

Already Greece is a prime re-fuelling territory for commercial ships operating with oil engines, and natural gas is being seen as a fuel of the future in this specialized market. Moreover the Greek-owned shipping sector has in the past few years built almost a third of the world's vessels designed to carry LNG and is a main lobby force behind the push in Greece to establish an LNG hub. The main issue concerning the aforementioned is for DEPA to acquire the necessary capital for that purpose, which may well be found amongst the present day contesters in its impeding privatization.

In another interesting development related to the above, representatives from the Qatar sovereign fund met with Greek energy businesses recently in Athens and expressed interest in participating in the project by the Kopelouzos energy holding company regarding a floating LNG terminal close to the port of Alexandroupoli. The Greek company has submitted a business plan last year to the Greek regulatory authorities, which was subsequently accepted, and is in talks with potential investors. The Qatar fund is interested in investing and making an inroad to the nearby region by placing funds in the railway connecting Alexandroupoli with Turkey and Bulgaria up to the Black Sea.

According to the details released by the Greek regulatory authority, the project of Kopelouzos group details around an offshore floating LNG installation and degasification terminal around 22 Km South West from the port of Alexandroupolis in the Aegean Sea. A pipeline will connect the terminal to the mainland where the natural gas will be then imported in the Greek nationwide pipeline system in the location of Amphitriti. The terminal will have the capability of storing up to 145,000 cubic meters of LNG and its yearly capacity will reach 2.6 billion cubic meters of natural gas. The plan is also to link the system with the Interconnector Bulgaria-Greece pipeline (IGB), so as to supply that market as well and from there on to be able to ship the commodity through the rest of the EU-backed interconnectors up to the Central European markets.