Greek Natural Gas Sector in the Spotlight
A conference on the present-day developments of Greece's natural gas sector and its surrounding region was organized by the Research Centre for Energy Management (RCEM) at ESCP Europe Business School and the Greek Energy Forum (GEF), under the auspices of the Ministry of Environment, Energy and Climate Change, Hellenic Republic. At 'Recent developments in the Greek Gas and Power Markets', various topics were discussed by policy makers and stakeholders both for the state and in the private sector.
Rudy Van Beurden, Communication and Public Affairs Director of the Belgian company Fluxys paid special attention to the need for establishing a natural gas trading hub in Greece with a regional outlook, so as to stimulate competition, decrease prices, enchase energy security and assist in the spreading the use of gas to both consumers and industry. According to Van Beurden, the market should be liberalized and necessary infrastructure projects should be on track, so as to have a trading hub after all, and Fluxys is committed into assisting Greece, and DESFA in particular, towards that aim.
Panagiotis Kanelopoulos, CEO of Greece's only fully-private gas trading company, M&M, elaborated on the changing nature of the Greek gas market. For the first time independent players place great importance on LNG trade, which has as a cornerstone the Revythousa LNG terminal, soon to be upgraded and able to periodically serve neighbouring markets as well. He added that more installations are needed if we are to talk about a liberalized, fully-functional market. Interconnectors with the rest of the Balkan countries are a crucial step towards this aim as well.
The President of DEPA, Giorgos Spanoudis, commented on global energy markets changes. He does not expect US shale gas to reach Europe any time soon, if at all. Mr. Spanoudis also noted that the demand for gas in Greece has unexpectedly fallen recently by 25%, which is a trend that has not been fully analyzed as of yet with regards to its significance and impact. Moreover, he estimates that by 2015 the local market will be fully liberalized and the country should invest as soon as possible in its own transmission, storage and trade infrastructure, because being part of international pipeline projects by itself is not of great importance if the national gas market is not adequate enough to take advantage. Gas consumption in the country, at the same level today economically as it was in 2005, will see changes implemented to foster gas as a more attractive option, a difficult task now with declining oil prices.
The head of DESFA, a Greek transmission gas company, Konstantinos Xifaras, pointed out that the regulatory changes that have been gradually implemented in the Greek gas market have made liberalization possible, along with new infrastructure projects, such as the 75% capacity upgrade of the Revythousa terminal and the reverse flow capacity with Bulgaria through the existing pipeline. DESFA also made a recent deal with Fluxys on a future creation of a wholesale trading market in the country, via the establishment of a hub. DESFA has as a main target to accomplish this goal and be part of a regional Southeastern European gas network in which Greece via its LNG projects and inclusion in the Trans-Adriatic Pipeline (TAP), will be able to secure gas needs and push forward integration with its neighbours.
Greece's Deputy Minister of Energy, Makis Papageorgiou, referred to the strategic role of Greece in gas transactions, citing TAP as a prime example of international cooperation with a leading role for his country. Mr. Papageorgiou emphasized the upgrade of LNG trade, both for local needs and supplying the region. Furthermore for that purpose a second terminal is being prepared for the Northern part of the country to be coupled with the Interconnector Greece-Bulgaria (IGB) and the long-term goal of the corridor Greece-Central Europe through a series of interconnectors between all countries.
A special focus was also placed on the East Med offshore reserves, which for the Minister Papageorgiou represents a locale for the alternative supply of the EU through Greece via a proposed pipeline that has already been submitted to the European Commission’s list of projects of common interest.