Greek DEPA Changes Course
The new CEO of Greek state gas supplier Depa, Theodoros Kitsakos, revealed the company's mid-term strategy earlier this month in a press conference. Included in the new strategy are adjustments for a number of important projects.
As part of the strategy, the company's expectation of using new LNG infrastructure has been downgraded. Additionally, as a main aim of the mid-term strategy, the company is seeking to increase domestic gas use and is examining the possibility of reenacting both the Turkish Stream and East Med. pipeline routes.
During the press conference, which took place on January 12, Kitsakos said that Depa would aim to increase the domestic use of gas by expanding the urban gas network in order to accommodate a sizeable increase in household customers by 2018. Further, he said, the company was focusing on expanding the use of gas for electricity consumption to coincide with Greece's goal to reduce use of lignite (so-called 'brown coal').
Speaking about the Interconnector Greece-Bulgaria (IGB), Kitsakos noted that market testing is ongoing for this pipeline and initial findings have uncovered a 1bn m³/yr deficit in the initial capacity plans.
Kitsakos also expressed uncertainty about a planned LNG terminal to be constructed in Alexandroupolis by the GasTrade Greek Company and the part it will play in supplying the IGB.
According to the CEO, should GasTrade agree to LNG delivery from the US Cheniere Company in the future, pricing will be a key issue. Currently Greece imports gas from Gazprom at a price of between $4.6 and 4.7 /mn Btu, Kitsakos said; from Turkey's Botas at $5.9/mn Btu; and from Algeria's Sonatrach at $6.5/mn Btu. Gas at the Dutch TTF is around $6/mn Btu.
However, the price Cheniere will ask for gas is rumoured to be around $7/mn Btu. Because of this, Kitsakos said, if Depa is to take gas from the $400mn LNG terminal in Alexandroupolis, there needs to be a solid and competitive understanding of how pricing is going to be developed. Under the current and rumoured pricing terms, he said, LNG supply from the terminal to the IGB remains questionable.
Kitsakos also spoke, in the press conference, about the prospects of the proposed Interconnector Greece-Italy (IGI), a joint project with Edison. The CEO referred to it as a key infrastructure project, which will enable the country to link the Balkan, Turkish and Italian markets. To further enable the linking of those markets, Depa also supports the Turkish Stream project and East Med one, Kitsakos said, though he acknowledged that that all of those projects depend on a range of political issues being resolved. The CEO did not give any details about the feasibility and viability of the eventual construction of those pipelines.
At the same press conference, Kitsakos also announced that, despite the downturn in the Greek economy, Depa was considering entering the stock market, boosted by its positive financial results. Its estimated turnover for 2015 is projected to exceed €900mn with Ebitda of €60mn. Additionally, the company has zero debt and has €135mn in outstanding payments from its customers, which it expects to be paid more than 80% of in the coming 18 months.
Ioannis Michaletos