New Greek Government Outlines Gas Strategy
The Athens Energy Forum 2015 outlined the basic principles of the new Greek government's natural gas policy. Panagiotis Lafazanis, Greece's Minister of Energy, outlined the most important aspects and highlighted that the policy is going to be independent, multidimensional and active.
The Forum attracted more than 600 participants and delegates from all major state and private organizations in Greece as well as high level delegations from the US state department, BP, Naftogaz, Edison and other important world energy players. The Greek Minister emphasized that an EU approach is against any neo-liberal energy strategy and in particular, he held a negative stance against privatizations of key sectors of the energy sector, including strategic gas installations and corporate structures.
Furthermore he pointed out that the emerging gas routes should have as a basic principle to increase interdependence and collective productive collaboration of the countries in between and not to be used as leverage by larger geopolitical powers against weaker partners. Further, he expressed his governments opposition to the new initiative by the EU's Commission regarding the proposed Energy Union clauses that will oblige member states to submit for approval all of their bilateral energy agreements with any other country or corporation. In that sense, Athens sends a clear cut message that has also been sent by other EU countries, which calls for a stop in the centralization of power to the so-called "Eurocrats" and is also inexorably related to the EU's relations with Russia, Azerbaijan and other natural gas producers and traders.
The Greek Minister also explained that the urgent priority of the new administration is to announce the sea zones in its Exclusive Economic Zone (EEZ) along with successive agreements with neighbouring states for the purposes of large scale research and exploration projects. In reality, these zones refer to those in between Greece and Cyprus which are, at the moment, contested by Turkey, resulting in diplomatic brinkmanship between Athens and Ankara.
The director of SYRIZA's party energy sector, Thodoris Kitsakos, relayed that the main target of the government is to make Greece a major gas hub by attracting not only TAP pipeline but also the proposed Turk Stream, along with interconnections with all neighboring countries, so as to achieve a maximum flow of 60 bcm per annum. This will transform Greece into a major gas hub not only for the Balkans but for the rest of Europe as well.
The former Deputy Minister of Energy and a past president of the DEPA Company, Makis Papagerorgiou, discussed his approach by stating that the government has 'fuzzy' policy regarding the privatization of DESFA to Azeri SOCAR and it obstructs, to an extent, the process of the TAP project by requesting last minute changes. He said that his previous administration had already managed to secure a 5% share in TAP that could be exercised in due term and also criticized the government for failing to liberalize the market of the natural gas sector, whilst it condemned the trials of the government to change the rules of the game as he sees it.
Minister Lafazanis nonetheless fully backed TAP and pointed out that changes that will enchase the Greek position, which is the unquestionable major transfer corridor should be made for the benefit of the local communities and the state budget. He explained that these requests to the consortium have already been positively met in principle and he expects further clarifications soon upon those.
At that point it should be noted that just before the Athens Energy Forum 2015, Panagiotis Lafazanis met with the VP of SOCAR Elshad Nazirov to discuss the ongoing sale of the DESFA transmission Gas Company to SOCAR. Nazirov had already publicly denied the three major changes requested by Lafazanis concerning TAP and which were transfer fees to be paid, decrease in the price of gas to be sold to Greece and involvement of DEPA as shareholder in the consortium.
Nevertheless, both sides agreed to establish a joint bilateral committee that will examine said requests. It should be noted that the rest of the partners in the pipeline project appear positive regarding Greek demands. Meanwhile the other sensitive subject, that of privatization, was barely touched upon. This is due to the fact that it has been essentially "frozen" due to the EU's adamant approach into denying access to SOCAR by proclaiming possible violations of the Third Energy Package.
The privatization has been ongoing since mid-2013 when the Azeri side paid a10% pre-payment of the overall €400 million price tag for acquiring 66% of DESFA. They have time to withdraw from the competition by summer 2015 and gain back their down payment, which looks to be the most probable outcome.
Thus it is becoming clear after the consultations between the concerned sides and the public rhetoric that was heard in the Forum, that the DESFA privatization is essentially terminated at that stage, whilst TAP's construction which is set to enact in 2016, is ready to go.