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ΙΕΝΕ study: ITGI Pipeline is the Most Advantageous Project for the EU and Greece

Posted: Friday, January 13, 2012

The ITGI gas pipeline contributes decisively to the diversification of energy supplies that is so much necessary for Europe and which the EU seeks to ensure. Moreover, ITGI is the most mature pipeline project of the South Corridor in terms of licensing and financing.

Th e se are some of the main conclusions of a study that the Institute of Energy for SE Europe (IENE) recently completed, which is a comparative analysis of the benefits that Greece will gain from three competing potential gas pipelines transcending the country, i.e. ITGI, TAP and South Stream. For the comparison between the above three pipelines, the study considered 15 specific criteria including economic viability, the degree of preparedness of each pipeline in terms of implementation, as well as the added value for Greece.

The South Stream pipeline, according to the study, is not offering supply diversification, but plainly a diversification of route for the flow of Russian natural gas towards Europe. It must also be noted that there is lack of substantial information regarding the progress of the realization of th is project.

The TAP project is supported by big energy companies and has, thus, adequate economic resources for its implementation . The project’s cash flows and impact on employment in the construction phase are comparable to the ones of ITGI. However, Greece is for TAP solely a host country, whereas ITGI’s planning involves substantial investments in Western Greece, offering significant benefits during its operation phase.

More specifically, ITGI emerges as the most desirable option for Greece and the broader S.E. European region. From Greece’s point, ITGI will undoubtedly bring in higher investments at local level and will also enhance security of energy supply, providing natural gas from the Caspian region to the Greek market, securing, at the same time, the operation of the regional gas distribution companies (ΕΠΑ ) in Epirus and Western Macedonia. From a regional perspective the ITGI pipeline will provide immediate access to much needed alternative gas supplies, will also strengthen regional energy security, facilitate cooperation and help spearhead gas market development, by providing adequate volumes and a continuous gas flow. The role of the Interconnector Greece – Bulgaria (IGB), the development of which is already at an advanced level, must also be underlined as a part of the ITGI system.

It must further be noted that ITGI emerges as the most mature project in terms of licensing, risk minimization, engineering design and funding with the full involvement of key European institutions. Moreover, a significant part of its infrastructure is already in place, through the Greek-Turkish interconnector, and there only remains the completion of its branching to Western Greece and its underwater part towards Italy. IENE’s study also stresses that ITGI, unlike the other projects, enjoys the full support and cooperation of the governments of Turkey, Bulgaria , Greece and Italy.

As far as the economic benefits for the Greek economy are concerned, during the construction phase, ITGI will employ 10,563 persons, whereas TAP will employ 9,054. The value added effect of ITGI at the construction phase is estimated at 432.474.750 €, whereas the value added effect of TAP is estimated at 370.692.643 €.

Concerning the economic impact over a 25 year period, ITGI is considered of great significance for the Greek economy, as additional estimated investments of 150 million € and hundreds of new jobs will be created during its operation phase, including 900 permanent jobs in connection with the regional distribution companies in Western Macedonia and Epirus. On the other hand, the TAP project is expected to deliver minimum cash inflows from its operating activity within Greece.

Overall, ITGI is considered as the most mature project, which will be ready to undertake the task of bringing new gas supplies from the Caspian region to the European markets and keep supplying them at competitive market rates with full security through uninterrupted gas flow.

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