Energy affairs
Directorate B7 for International Energy Affairs
Given the interest with which issues of international energy policy in the global arena are followed in the 21st century, and considering that the construction of oil and natural gas pipelines are among the priorities of our countrys foreign policy, a Directorate for International Energy Affairs has been set up at the Foreign Ministry (Directorate B7).
Within the framework of its competencies, Directorate B7 follows international energy issues and, in particular, energy developments in the field of oil and natural gas pipelines, electricity grids and the EU energy policy, as well as developments in the Caucasus and the Caspian Sea regions. It also follows energy issues in Southeast Europe and the Mediterranean, in particular. At the same time, it supports the work of the competent Ministry for these matters, i.e., the Ministry of Development.
Particular emphasis is naturally placed on how to convey the significant energy reserves in oil and natural gas that have been discovered in the Caspian region to international markets, and also on our countrys participation in this transport.
In particular:
In the oil sector, Directorate B7 actively follows developments regarding the promotion of the Burgas-Alexandroupoli oil pipeline project (BAP project), a project that will significantly boost Thraces further development, as well as that of the entire region of Southeastern Europe, providing an outlet to the Mediterranean for crude oil coming from the Caspian Sea.
The Burgas-Alexandroupoli oil pipeline will be 280 km long, with 135 km running through Greek territory. The total budget for this project is estimated (based on 2005 data) at 750-800 million euros and it will have the capacity to transport from 35 to 50 million tons of crude oil annually.
The pipeline will be served by special storage facilities at the port of Alexandroupoli with a capacity of 650,000 metric tons, as well as special infrastructure for floating platforms aimed at loading tankers, of a total capacity of 300,000 tons displacement.
Following a lack of progress for many years, the Trilateral Working Committee of Greece, Bulgaria and Russia for the promotion of the Burgas-Alexandroupoli oil pipeline project met in Athens (4-5/11/2004), and a Memorandum of Understanding (MoU) was agreed upon and finally signed on 12 April 2005, in Sofia.
In June 2006, meetings were held in Moscow and Sofia between Greek, Russian and Bulgarian businesses expected to take part in the pipelines construction and operation.
An even more significant development was the visit to Athens of Russian President Mr. Vladimir Putin, followed by the trilateral, Greek-Russian-Bulgarian summit meeting, during which a Joint Declaration of Cooperation in the Energy Sector was signed.
The draft interstate agreement was initialled in Burgas, on 7 February 2007, while the final agreement was signed on 15 March.
A Shareholders Agreement was signed on 18 January 2008 in Sofia, which finally led to the creation of the company Trans-Balkan Pipeline B.V., seated in the Netherlands, which is responsible for the projects construction.
In the natural gas sector, Greece intends to become a significant transit hub for natural gas towards major European markets. A natural gas pipeline will cross Turkey starting from Azerbaijan, to be linked with the pipeline crossing northern Greece across its East-West axis, ending in Stavrolimenas (near Igoumenitsa), Greece, and from there it will continue through an underwater pipeline to Otranto, Italy. The pipelines estimated annual transport capacity is 11.6 billion m3 of natural gas.
Construction work on the section of the pipeline between Karacabey, Turkey, and Komotini (Greece) has already begun and is expected to be complete in the first months of 2007, whilst the part between Greece and Italy is currently in the phase of feasibility studies and probing. In this way, the Greek pipeline system will be connected to the Turkish pipeline system, and a geopolitical project of major importance will be implemented; i.e., the South Energy Corridor, in order to transport natural gas towards Western Europe, through Italy.
The South Energy Corridor will be constructed in the following stages:
1. Phase A: exploration of oil deposits at Shah Deniz in Ajerbaijan, construction of an offshore oil rig and a terminal for reception/liquefaction in Sanghasal (42 km south of Baku);
2. Construction of the 970 km-long Baku-Tbilisi-Erzerum natural gas pipeline (442 km in Azerbaijan, 248 in Georgia and 280 in Turkey). The pipeline is called SCP (South Caucasus Pipeline), its estimated budget is 1 billion dollars, and it is considered of the highest geopolitical importance (for the EU and US). Its maximum annual capacity is 30 billion m3;
3. Linkage with the Turkish pipeline system (in Turkish territory) up to Karacabey;
4. Construction of ground and underwater pipeline from Karacabey to the Greek-Turkish borders and from there to Komotini, where it will be connected to Greeces central network of natural gas pipelines;
5. Construction of the Thessaloniki-Stavrolimenas pipeline in Western Greece;
6. Construction submerging of underwater TGI Interconnector pipeline, starting from Stavrolimenas in Greece to reach the port of Otranto in Italy with the appropriate reception infrastructure;
7. Construction of the pipelines branch-lines on Greek territory, with a view to potentially supplying neighbouring Western Balkans countries, i.e., FYROM, Albania, Serbia, Croatia, Slovenia and Bosnia-Herzegovina;
On 31/01/2007, a Cooperation Protocol was signed between Greeces competent Minister, Mr. Sioufas, and the competent Italian Minister, Mr. Barzani, on the construction of the TGI pipeline to Otranto, Italy. A company named Poseidon Co. is being set up for this purpose.
The signing of this Protocol lays the foundations for the construction and operation of the entire South Energy Corridor. An official ceremony was held on 18 November 2007 at the Greek-Turkish border inaugurated a part of the TGI-INTERCONNECTOR pipeline connecting Greece with Turkey in the presence of the two countries Prime Ministers, Messrs. Karamanlis and Erdogan.
Regarding electricity grids, Directorate B7 assists the competent Development Ministry in following the EUs energy policy, and informs the Greek agencies concerned. In the fast-developing sector of renewable energy sources, Directorate B7 consults the involved parties and follows new trends in this significant market, in Greece and the rest of Europe.
Through Greeces diplomatic authorities, Directorate B7 closely follows all the international developments with regard to oil, international energy agreements and trends, as they are the ones shaping, to a great extent, future geopolitical developments.
Finally, an important part of this Directorates work is monitoring matters dealt with by international and regional energy organisations, which take decisions on Europes energy future, and that of other regions.
Last modified: December 2008