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GasLog acquires 20% shareholding in Gastrade

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GasLog Ltd has announced that it has closed a sale and purchase agreement (SPA) to acquire a 20% shareholding in Gastrade S.A.

The SPA was originally announced on 22 December 2016, but now all conditions required to close it have been satisfied. Gastrade is licensed to develop an independent natural gas system located offshore Alexandroupolis in North Greece, using a floating storage and regasification unit (FSRU), as well as other fixed infrastructure. As well as being a shareholder, GasLog will also provide operations and maintenance (O&M) services for the FSRU through an O&M agreement.

Gastrade is currently in the process of having discussions with various potential investors. These include DEPA, the Greek state-owned gas company, Bulgarian Energy Holding (BEH), the holding company of the Bulgarian Ministry of Energy, and major gas suppliers. A number of other global companies have also shown interest in participating in both the ownership and development of the terminal, with additional companies expressing interest in supplying LNG for the project.

The FSRU project will help provide energy for countries that are currently dependent on pipeline gas in South Eastern and Central Europe. In addition to improving the security of supply in the region, it will promote competition and pricing flexibility. It is backed by the Greek and Bulgarian governments, and has the support of the EU, having been assigned the status of an EU Project of Common Interest (PCI), that is further designated as a priority EU energy infrastructure project. It is expected that an EU grant will partly fund the front-end engineering and design (FEED) study, which is expected to commence in the coming weeks.

GasLog claims that Gastrade is planning to make a final investment decision (FID) by the end of 2017, with the project scheduled to commence operations by the end of 2019.

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