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Friday, 18 March 2016 18:30

DEPA’s main objectives is to strengthen Greece’s role as a gas hub, - George Spanoudis, Chairman of the Board, DEPA Group Featured


Caspian Energy (CE): Mr. Spanoudis, how is the process of privatization of DEPA going? Which companies are major candidates for acquisition of 65% of the state package? Will the state preserve the control package?

George Spanoudis,Chairman of the Board, DEPA Group: As it is publicly known, the Hellenic Republic Asset Development Fund (HRADF), who is the majority shareholder of DEPA, launched the privatization of DEPA Group on February 2012. In January 2013, following the submission of indicative offers, selected bidders were qualified for the final stage of the bidding process. However, the privatization of DEPA was not completed, as there was no binding offer submitted by any of the bidders in the final stage of the process. Since then (June 2013), there have been no developments with respect to the privatisation of DEPA, which is an area of exclusive competence of the Hellenic Republic Asset Development Fund.


CE: In one of your speeches you mentioned that gas demand in Greece will increase almost by 3 times (up to 8 bcm of gas per year) in 15 years. What shall cause such growth and are there any guarantees for exporters regarding future possible gas supplies? 

George Spanoudis: The Greek gas market has experienced a significant decline in demand more severe than in other European countries. However, Greece offers some structural advantages that can potentially lead to strong growth for gas, such as recovery from a deep economic crisis, low gas penetration offering large potential for increasing market size, access to diversified gas sources (pipeline and LNG) and improving connectivity in the region.

Given the uncertainty in demand evolution, DEPA has identified and assessed a number of scenarios for the Greek market. Gas demand is determined by a few key parameters, namely: global oil and gas prices, domestic gas prices and its economic attractiveness with respect to other fuels for power generation, industry, heating, transport and regulatory framework

Under favorable conditions, the Greek market has substantial growth potential in the mid-long term.


CE: Can we say that DEPA is interested in the free gas market where gas contracts will be signed on basis of spot agreements? Will there be long-term contracts or they will remain in the past?

George Spanoudis: DEPA believes that with increasing interconnectivity in the region, the share of spot contracts in DEPA’s portfolio will be inevitably increased. But as a fully liquid market will take some time to be created in the region, we consider that at least in the next 5-10 years long-term contracts will continue to cover the majority of our needs.



CE: One of the major strategic lines of DEPA is to develop tanker fleet for LNG and compressed natural gas. What stage has the construction of the terminal in Alexandroupolis reached? What shall be its capacity?

George Spanoudis: One of DEPA’s objectives is to develop further small scale LNG and CNG as a means to supply remote regions which do not have access to the main grid, as well as to supply gas for transport needs. In this respect DEPA is participating in and coordinating the EU co-funded POSEIDON MED II project whose aim is to facilitate the use of LNG for maritime uses and expand LNG bunkering services in the East Mediterranean. Considering the adequate LNG supply chain, several investments will be needed including possibly a small feeder vessel, but not a tanker fleet, as it is mentioned in the question.

The Alexandroupolis terminal will have a storage capacity up to 170.000 m3 and send out capacity of 700.000 m3/h (up to 6.1 bcm/y). The stakeholders are considering next steps to be taken and the establishment of the most appropriate corporate arrangements for undertaking the project’s development, construction and operation.


CE: DEPA has ambitions to become a hub for gas supplies to Central Asia. How do you plan to achieve it? Will you compete with Spain as a major supplier of regasified LNG to the European grids, Italy and Croatia? Does the EU have any agreed market position regarding this issue?

George Spanoudis: Greece is geo-strategically well placed between gas producing countries and European markets. Accordingly one of DEPA’s main objectives is to develop infrastructure which strengthens Greece’s role as a potential regional gas hub. In this respect IGB and the FSRU in Alexandroupolis, as well as TAP (and possibly IGI) will contribute towards this goal and enable the flow of diversified sources of gas, in the regions (especially in South East Europe).  All the above projects are included in the EU 2nd PCIlist.


CE: What role will the Trans-Adriatic gas pipeline (TAP) play in this aspect? What stage has the project implementation reached?

George Spanoudis: TAP is a project of major importance which enhances the role of Greece as the EU’s gateway for gas from the Southern Corridor. DEPA does not however participate in TAP and therefore questions regarding its development should be addressed to its stakeholders.


CE: Does the company expect to develop LNG supply from the USA? What work is carried out in this direction?

George Spanoudis: DEPA's strategy is to have a secure but also diversified portfolio which is well positioned to capture synergies and opportunities from the global market dynamics.

LNG from the United States is an option which DEPA examines seriously. This and other opportunities in the area, including US LNG supply in the region, will be promoted by the availability of additional infrastructure such as the Northern Greece (Alexandroupolis) FSRU and IGB, both projects which DEPA actively supports and promotes as key to enhance competition and security of supply in our region.


Interview made by Ceyhun Bayramov, Olga Nagiyeva  


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