Greece To Sign Energy Treaty With North Macedonia

Greece is expected to conclude its latest energy deal in early May, this time with the neighboring North Macedonia.

Local media report that North Macedonian Prime Minister Zoran Zaev is scheduled to visit Athens within the first half of May to sign the respective treaty, which will promote the creation of a pipeline interconnection project to link the gas networks of the two countries.

In March, the Finance Minister of North Macedonia had approved the final text of the concerted agreement in Athens, after years of negotiations.

This new pipeline will cover a total 160 km distance, of which 50 km on Greek territory. It will start from the Nea Mesimvria area of Thessaloniki and end up at Shtip, 110 km into North Macedonia.

From the valve station near the border at Evzoni (Gevgelija), the interconnector pipeline will connect with the newly completed trans-Adriatic pipeline which carries gas from central Asia via Turkey, Greece and Albania to southern Italy.

Important energy connection works for Greece and Europe

As provided by the Memorandum of Understanding signed between Greece and North Macedonia in 2016, the Greek part of the pipeline will be constructed by the Hellenic Gas Transmission System Operator (DESFE), while the rest of the project will be undertaken by North Macedonia’s National Energy Resources (NER).

Investors in the Greek section of the pipeline include the Greek State with a 34% stake, then SENFLUGA with the remaining 66% (composed of SNAM 60%, Fluxys20% and Enagas 20%).

The energy deal between Greece and North Macedonia is of great importance for the upgrade of the regional energy infrastructure and the materialization of the Central and South Eastern Europe energy connectivity initiative (CESEC).

Originally established in February 2015, the works to “accelerate the integration of central eastern and south eastern European gas and electricity markets” spans nine EU Member States (Austria, Bulgaria, Croatia, Greece, Hungary, Italy, Romania, Slovakia and Slovenia) and eight Contracting Parties of the Energy Community (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, the Republic of Moldova, Serbia and Ukraine).

As a European Project of Common Interest, the interconnector pipeline is partly funded by the European Regional Development Fund.

Independent energy project planned in Alexandroupolis

Also in March, the Greek company Gastrade, partly owned by the Public Gas Corporation of Greece (DEPA), signed cooperation agreements with North Macedonia’s National Energy Resources (NER) and AD Power Plants (AD ESM) for the construction of a liquified natural gas floating storage and regasification unit terminal near Alexandroupolis, Northern Greece.

The project supports, complements and works in harmony with the other existing or planned key gas infrastructure projects in the region, such as the Greece-Bulgaria, the Greece-North Macedonia and the Bulgaria-Serbia interconnectors, plus the Revithoussa Terminal.

The facility in Alexandroupolis will be a new, independent energy gateway for the markets of Southeastern and Central Europe. Together with the terminal at Revithoussa, they will provide the only natural gas supply infrastructures in the region which are independent of gas transmission through Turkish soil, according to an announcement by the Greek company.

“NER aims at acquiring a share in the share capital of Gastrade whilst AD ESM is interested in reserving capacity at the Terminal on a long-term basis. The parties will work together in formulating the details of both agreements to be presented to their respective governance bodies for their approval”, it added.

The agreements among the three parties were signed in Skopje, in the presence of the North Macedonian Prime Minister, Zoran Zaev.

The project, also partly financed by the European Regional Development Fund, is expected to be operational in 2023.