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    Spain's Enagas eyes stake in Albanian gas grid operator


Albania is interested in broadening the role of gas in its energy mix.

by: NGW

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Spain's Enagas eyes stake in Albanian gas grid operator

Spain's Enagas has signed a strategic cooperation agreement on taking a potential stake in Albania's gas transmission system operator Albgaz, the companies said on October 4.

Albania has only limited gas infrastructure, besides serving as a transit country for the Trans-Adriatic Pipeline that flows Azeri gas to southeast Europe. But the government is looking to develop gas-fired power plants and undertake a gasification programme, and is also weighing up the construction of an LNG terminal.

Enagas CEO Arturo Gonzalo held talks in the Albanian capital Tirana with his counterpart at AlbGaz, and the cooperation deal was signed at a meeting chaired by Albania's deputy prime minister and energy minister. The two companies also agreed to study joint projects. It builds on a memorandum of understanding they signed last June, on working together to develop Albania's gas infrastructure.

Albania relies heavily on hydropower, putting its energy supply at risk during times of drought. As such, the government is looking to develop gas-fired generation as a baseload supply source.

The country already has a 100-MW thermal power plant in the port of Vlora capable of running on both gas and oil. But though completed back in 2009, it remains offline because of technical faults in its design. In March last year, Albania's government agreed with ExxonMobil and US LNG vessel operator Excelerate to assess the construction of a regasification terminal in Vlora. But an investment decision has not yet been taken on the project.

Albania could also source Azeri gas from TAP, but only if the pipeline's capacity is enlarged. Its current 10bn m3/yr capacity is fully booked by buyers in Italy, Greece and Bulgaria.

Enagas did not say how large a stake it was interested in acquiring in AlbGaz. But CEO Gonzalo said the latest agreements demonstrated the company's "long-term commitment...in Europe and, in particular, in the Mediterranean region, in line with its strategy of alliances with operators to further the security of supply."