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European Commission to fund major LNG project in Greece
The European Commission (EC) will provide €166.7M (US$198M) for the construction of a new LNG terminal in Alexandroupolis, Greece
Funding for the project, which is expected to improve security of supply for Greece and the wider southeastern European region, was approved under the EU’s state aid rules.
Commenting on the EC’s decision, executive vice-president Margrethe Vestager said “The new LNG terminal in Alexandroupolis will improve gas supply and infrastructure not only in Greece, but in the whole southeastern European region. This will contribute to achieving the EU’s goals in terms of security and diversification of energy supply. The Greek support measure limits the aid to what is necessary to make the project happen and sufficient safeguards will be in place to ensure that potential competition distortions are minimised.”
The Greek State will finance the project using European Structural and Investment Funds and support will take the form of a direct grant amounting to €166.7M (US$198M).
Greek terminal company Gastrade, backed by LNG carrier owner GasLog among others, will serve as promoter and operator of the Alexandroupolis terminal. The company signed agreements with North Macedonian firms National Energy Resources, Skopje and AD Power Plants in April.
The Alexandroupolis project will consist of a floating storage regasification unit (FSRU), as well as subsea and onshore gas transmission pipelines which will connect the FSRU to the National Natural Gas System of Greece (NNGS).
The FSRU will be stationed approximately 17.6 km from the town of Alexandroupolis in northern Greece, roughly 10 km offshore. The vessel will have an overall delivery capacity 5.5Bn m3 per year.
The subsea and onshore sections of the gas transmission pipeline, of 24 km and 4 km respectively, will transmit the gas from the floating unit to the Greek natural gas network. The connection point of the pipeline will be the Kipi‐Komotini branch of the NNGS, at a new entry point from which the natural gas from the floating unit will be transmitted to the NNGS.
In addition to Greece, the European Commission said the terminal will constitute a new potential energy source to feed into the interconnector between Greece and Bulgaria (IGB).
Public Gas Corporation of Greece and the Bulgarian gas Transmission System Operator (Bulgartransgaz EAD) hold stakes in Gastrade.
The Commission approved public support for the IGB project, which is currently under construction, under EU State aid rules in November 2018.
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