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DESFA and NER sign agreement for the Greece-North Macedonia gas interconnector

Greece’s natural gas transmission system operator DESFA signed a cooperation agreement with NER SKOPJE, North Macedonia’s energy company responsible for the construction and development of national pipelines.

The Agreement, signed in the framework of the 5th Southeast Energy Forum held in Thessaloniki by the American-Hellenic Chamber of Commerce (AmCham) and the Hellenic Association for Energy Economics (HAEE), concerns the development and construction of the Greece-North Macedonia Gas Interconnector.

“The Greece-North Macedonia Gas Interconnector will further upgrade the geopolitical role of Greece, which is steadily establishing itself as an energy crossroads and gas hub in Southeastern Europe,” said the Minister of Environment and Energy of Greece, Kostas Skrekas. “We enable our northern neighbour to reduce its environmental footprint, by gradually replacing more polluting sources of electricity with natural gas and contributing to the overall European goal of a climate-neutral European economy by 2050. The project is important as it will be a growth lever for the economies of the two countries, with the creation of thousands of jobs during the construction of the pipeline.”

More specifically, the Cooperation Agreement establishes the cooperation principles pursuant to which DESFA and NER intend to coordinate the main phases, respective commitments and accompanying milestones of the development of the gas pipeline interconnection project, including the launch of the binding Market Test later this year, in accordance with the terms and conditions that will be approved by RAE and following the Final Investment Decision (FID) by both parties, expected in the first half of 2022, facilitating the timely and effective completion of the project’s construction, in accordance with an agreed time schedule.

The pipeline is planned to have a total length of 123 kilometres and will extend from Nea Mesimvria to Negotino via Evzoni/Gevgelija, connecting the national natural gas transmission systems of Greece and North Macedonia, operated by DESFA and NER respectively. Its initial capacity will be 1.5 billion cubic metres (bcm) per year, with the possibility of expanding to 3 bcm per year, while studies have been carried out for the pipeline to adopt the appropriate requirements for the transport of green hydrogen.

“Τhe signing of the cooperation agreement today between DESFA and NER gives a significant boost for the development of a mutually beneficial project for Greece and North Macedonia, while further establishing DESFA role as an enabler of the transition of the South-East Europe region to an interconnected and more sustainable energy future,” stated the CEO of DESFA, Maria Rita Galli. “DESFA remains faithful to its vision of placing Greece at the core of energy developments, by paving new energy ways and transforming the country into an international energy hub of a sustainable, secure and economically efficient European market.”

“Τhe signing of this agreement between the two companies is among the last and very important steps, towards our final goal, the beginning of the realisation of gas interconnection,” added the Executive Director of NER SKOPJE, Bajram Rexhepi. “The construction of this corridor, not only will diversify, but will also create a stable source of our natural gas supply, and its benefits will be available not only to North Macedonia but to our northern neighbours as well. Our cooperation with DESFA, will not end with the completion of the gas interconnection, and of course, this partnership will deepen and extend to other areas as well, in order to offer favourable conditions in the energy market.”

The project, with a budget estimated to reach 110 million euros, will further upgrade the role of Greece as a gas hub, strengthening its position as an energy crossroad, with the transmission of natural gas from the Natural Gas Transmission System of Greece to North Macedonia and beyond.

On the other hand, it will allow North Macedonia to improve its environmental footprint, substantially contributing to the energy transition of the country with the diversification of natural gas supply, enhance the security of supply and the gradual replacement of the most polluting sources of electricity with natural gas, contributing to the overall European commitment for a climate-neutral continent by 2050.

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