ICGB expects to obtain building permit in Greece no earlier than 2018

The first step in the process of obtaining a building permit will be a decision for exemption from the rules for tariff, ownership and access to third parties, expected to be adopted by the regulatory authorities of both countries this month, and by the EU at the beginning of 2018, ICGB said in a statement on Wednesday.

After that, the project has to obtain a licence for a transmission system operator, which is a condition for obtaining a building permit under Greek law.

Last week, Bulgarian energy minister Temenuzhka Petkova said the country has issued the building permit for the section of the gas interconnection on Bulgarian territory, opening the way for separate tenders - for construction of the interconnector and for supply of line pipes - to be launched in November.

The IGB pipeline will connect the Greek gas transmission system in the area of Komotini to the Bulgarian gas transmission system in the area of Stara Zagora.

The planned length of the pipeline is 182 km and the projected capacity will be up to 3 billion cu m per year in the direction from Greece to Bulgaria. Depending on interest from the market and the capacities of the neighbouring gas transmission systems, the capacity of the pipeline can be increased up to 5 billion cu m per year, thus allowing for physical reverse flow from Bulgaria to Greece with the additional installation of a compressor station.

The gas link is estimated to cost 220 million euro ($241.8 million). The project company has secured a sovereign guarantee of 110 million euro under the annual state budget act, which could ensure loan financing under preferable conditions.

The project is being implemented by the joint venture company ICGB, in which state-owned Bulgarian Energy Holding (BEH) and Greece-registered IGI Poseidon hold equal shares. Greek public gas corporation DEPA and Italian energy group Edison own 50% each of IGI Poseidon.

($ = 0.8358 euro)