EU & WBs / Albania Energy Investment Updates

EU & WBs / Albania Energy Investment Updates

Presentation of Albanian Centre for Energy Regulation and Conservation - ACERC

ACERC is a think tank centre with focus on the Albania energy market and its integration in the regional IEM. The Acerc mission base on the in-depth knowledge of EU and regional energy law and policy and strives to provide a qualified contribution to the promotion of the liberalization and effective integration as well as efficient use of energy resources.

Acerc
main activities briefly consists in build-up collaborations and supports to market players in study researches such as the certificate reports, articles and periodicals. The transfer of high expertise through building-up institutional capacities by national and regional training courses, seminars and conferences. The institutional representation and integration within framework of the forum of Albanian School of Regulation.

For more visit us at the Official Website of Acerc | Albanian Energy Market - AEM Group in LinkedIn

Operator of Electricity System Distribution announces purchase fuel Petrol Diesel Super D 1 and Gasoil Super, Contract Notice Released, 02.17.2015

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Mon, March 02, 2015 00:04:36

Operator of Electricity System Distribution announces purchase fuel Petrol Diesel Super D 1 and Gasoil Super, Contract Notice Released, 02.17.2015

The Contracting Authority Operator of Electricity System Distribution announces purchase fuel Petrol Diesel D1 and Gasoil Super for the needs of OSHEE sh.a.

Type of procurement procedure will be open procedures by electronic means.

Limit Fund 1,395,670.65 EUR (195,000,000 ALL) without VAT, with funding source income OSHEE sh.a. Deadline for delivery of goods will be 12 calendar months from the contract award.

Request for prequalification submission deadline 13.03.2015 and deadline for opening of prequalification applications 3.13.2015 within the hour 11:00.



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Albanian Ministry of Transport and Infrastructure grant concession/PPP Highway 30 Years

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Sat, February 28, 2015 23:09:07

Albanian Ministry of Transport and Infrastructure grant concession/PPP Highway 30 Years


The Government of Albania through the Ministry of Transport and Infrastructure (“MTI”) intends to grant concession/PPP to construct, upgrade, operate and maintain the Milot – Morine Highway. The Highway forms part of the National Roads network and constitutes the largest road engineering project constructed in Albania’s history. Linking Milot, approximately 60km north east of the Adriatic Port of Durres, with Morine at the Kosovo border, the route forms the central section of the wider Albania to Kosovo Highway, connecting Durres with Pristina.

The main objective of this works and services Concession/PPP project is upgrading of the Highway and its effective operation and maintenance. The Future Concessionaire will upgrade, operate and maintain the Highway subject to a set of predefined performance standards over a 30 year concession term. The future Concessionaire will collect and keep toll revenue and in exchange it will have responsibility to implement and finance motorway improvement measures, construct a new Drini Bridge at Kukes, and implement the most urgent geotechnical stabilization works.

Request for Prequalification Submission Deadline Date: March 23, 2015, Time: 15:00 CET. Deadline for opening of Prequalification Applications Date: 23 Mars 2015 Time: 15:00 CET.





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Council of Ministers approves reached agreements with Korea and Switzerland February 26th, 2015

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Fri, February 27, 2015 22:32:01

Council of Ministers approves reached agreements with Korea and Switzerland

February 26th, 2015

Council of Ministers took several decisions in the last meeting on February 25, by approving several articles pursuant to “For the establishment of treaties and international relations” law by the proposal of Ministers of Energy, Finances and Transport.

With the proposal of Minister of Energy and Industry and Minister of Finances, Council of Ministers decided the approval in principal of the agreement reached between the Albanian Council of Ministers and Swiss Confederation government for “The establishment of capacities in developing gas infrastructure in Albania, II” project assistance grant, at the amount of 6.6 ml EUR.

With the proposal of Minister of Transport and Infrastructure and Minister of Finances, Council of Ministers decides the approval of loan agreement reached between the Albanian government and International Bank of Reconstruction and Development for “Project for the maintenance and road safety based in results” project, a 65.9 ml EUR loan.

Pursuant to article 1000 of Constitution and articles 5 and 7, of law number 8371, date 9.7.1998, “For the establishment of treaties and international agreements”, with the proposal of Minister of Economic Development, Trade, Entrepreneurship and Tourism, the Council of Ministers decided the approval of the agreement reached between Albania and the Republic of Korea for economic cooperation.

News source/photo credits: Invest in Albania



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SOCAR announces details of joint declaration by Southern Gas Corridor Advisory Council members 25 February 2015 16:38

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Thu, February 26, 2015 16:35:40
SOCAR announces details of joint declaration by Southern Gas Corridor Advisory Council members
25 February 2015 16:38


In order to secure the favourable financing of participants of the projects being implemented within the Southern Gas Corridor, new efforts to form a transparent, predictable and stable legislative environment and develop more efficient mechanisms to attract national and European financial institutions will be considered

Baku. Aghsin Rafigoglu – APA-Economics. The State Oil Company of the Azerbaijan Republic (SOCAR) has announced details of joint declaration by Southern Gas Corridor Advisory Council members, APA-Economics reports quoting SOCAR.

According to declaration, reliable supply and providence of safety of energy transportation to the world markets are the most important factors in sustainable development.

“We once more repeat the increasing significance of strategic cooperation and our intention for strengthening and extension of activities based on mutual benefit for successful implementation of the Southern Gas Corridor”, the declaration said.

The document also says that in order to secure the favourable financing of participants of the projects being implemented within the Southern Gas Corridor, new efforts to form a transparent, predictable and stable legislative environment and develop more efficient mechanisms to attract national and European financial institutions will be considered: “We confirm relevant legislative and initial legal requirements, including preparation of relevant countries for permission and confirmation decision demanded for start of activities on projects to be implemented within the Southern Gas Corridor. We once more confirm significance of development of energy relations and take into account the importance of continuation of policy being conducted for diversification of routes to transport energy from Azerbaijan to Europe and other markets”.

Moreover, the declaration says that development of strategic infrastructure is supported to productively use existing format of European Union regarding issues of implementation of project and there is concrete approach to the Southern Gas Corridor with the support of European Commission: “In order to practically and timely solve the issues to be arisen during the implementation of the Southern Gas Corridor, we consider to conduct clear working consultations in the bilateral and multilateral format with the potential future participants of the Southern Gas Corridor”.

The first meeting of ministers within the Advisory Council of the Southern Gas Corridor was held in Baku on February 12. At the end of the meeting, the authorized representatives of Azerbaijan, Albania, Bulgaria, Greece, Georgia, Italy, Turkey, United Kingdom, USA and Vice-President of the European Commission signed a joint declaration.



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SEECP, commitment to deal with common regional challenges Published on : 24 February 2015

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Thu, February 26, 2015 13:22:10

SEECP, commitment to deal with common regional challenges

Published on : 24 February 2015



Speech of Prime Minister Edi Rama at the ministerial meeting organized in Tirana in the framework of the South-Eastern Europe Cooperation Process (SEECP):

It is a great pleasure for me to welcome you here in Tirana, on behalf of the Albanian Government.

We regard the Southeast Europe Cooperation Process as a very important political platform to intensify dialogue in the region, to consolidate sectorial cooperation and advance the European integration of Southeast Europe by coordinating different ongoing processes of regional cooperation.

Southeast Europe has just left behind a first year since the beginning of the twentieth-century with no border conflicts in the region.

I think this is mainly because of our peoples’ aspiration to European integration, envisaged as a unique chance for a sustainable peace, prosperity and democracy. This means that we have no time to look back and are pressed to move forward, on the one hand by getting to a new stage the cooperation in the region and, on the other hand, by actively contributing in responding to new common challenges.

These are challenges deriving of threats from the ongoing conflicts near EU borders; challenges posed by terrorism fed by an infernal machine called ISIS, which have plagued peoples and areas in the Middle East and Africa. While an important challenge not so unconnected to the above is the organized crime and illicit trafficking.

Next to these security issues, there is a risk that our region’s economic gap between EU member states and non-EU member states widens further, making the prospect of EU integration process ever more distant. In the above-described context that means greater susceptibility to security threats that we are determined to prevent now and in the future. This is evident as a few of our region’s direct neighbors have been severely hit by the financial crisis.

In order to face these challenges it is of crucial importance to reinforce the security dimension of our regional cooperation.

Duly, our Joint Statement against Terrorism, that this meeting is going to endorse, emphasizes our commitments to further implement reforms, strengthen the rule of law, embrace youth cooperation, and improve economic development.



In the 2014 Summit, the Romanian Chairmanship rightly pointed out that Southeast European Cooperation Process was being revitalized and that we should work to make our region a credible partner for the European Union.

As the representative of the country that chairs this process in until June 2015, I enthusiastically agree and I would propose we add a next step.

Yes, firstly we need to ensure our position as a credible partner of the EU, but then we also should become a pro-active partner.

Europe is faced with economic, political and cultural challenges including racism, nationalism and xenophobia. In order to face those challenges efficiently, the European Union needs our region as much as our region needs the European Union.

The diversity of nations, ethnic groups, religions, cultures and beliefs makes South-East Europe a peculiar space, and if we succeed harmony, and prosperity within this diversity we would rejoice together the success of an important European endeavor.

In this context, Albania will continue to be a very committed partner of efficient regional cooperation and full European integration.

In this regard, during our chairmanship of the Southeast European Cooperation Process, we have been insisting on economy, energy and infrastructure, in order to reinforce existing initiatives that bring added value to our EU integration process, and also to bring forth new, flexible and efficient ways of multilateral cooperation in our region.

This is particularly important also in order to support the process started in Berlin last summer, as the most recent display of the existing political will in key EU member states to enhance cooperation in the region so that it may become a true region both in economic and political terms.

My government believes that the Berlin Process but also the relevant macro-regional strategies put forth by the European Union provide us with opportunities to improve connectivity within our region (especially in the Western Balkans) but also with the EU itself.

As such the Albanian presidency of the South-East Europe Cooperation Process will further engage in both diplomatic and political efforts in order to make the most of the political momentum that is now favoring regional cooperation based on concrete regional infrastructure and energy projects.

Last year we commemorated 100 years from a World War that sparked in our region to spread across continents heralding death and suffering hard to imagine for nowadays European young generations.

Precisely after 100 years, in another very peculiar time for the European continent, our region is passing through a unique positive momentum, which with the required determination can spark hope and a renewed perspective of prosperity to the European Union.

Albania is fully committed to facilitate, support and strengthen this positive momentum in our region, and to help unite our forces to meet the expectations of our peoples for a strong and united Europe. It is my firm believe that today that the European Union needs us as much as we need the European Union. And in front of the Union that is struggling with itself, we need to be united and we need to fight to make our voice heard and to show by example that we are ready to be part of a very common struggle. Without us, the Union is much more fragile and much more vulnerable and we should do our best to make it heard and to make it understood.

Again welcome and thank you very much!



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Albania-Italy Interconnection line will be constructed by Max Streicher company February 25th, 2015

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Thu, February 26, 2015 00:19:40
Albania-Italy Interconnection line will be constructed by Max Streicher company February 25th, 2015


The construction of Albania – Italy Interconnection Electrical Energy Line will be made by Max Streicher German company, as announced by the Minister of Energy and Industry, Damian Gjinknuri. Albanian Minister Gjiknuri and the head of Max Streicher company signed on Wednesday in Munich the agreement in creating a consortium for the construction of this project.

Based on the agreement, the German company will be the main leader of this consortium for the construction of a 200 million EUR interconnection line. Present during the signing of this agreement was the Bavarian State Secretary of Economy and Energy, Franz Jozef Pschiere, which expressed Bavaria’s interest and the support towards this project.

Gjiknuri and Pshciere held discussions about the cooperation of Albania and Bavaria in energy and economy and mentioned the potentials Albania offers in energy field.

Max Streicher will make the study of the feasibility and will finance the interconnection line construction in cooperation with other investors that will take part in this cross-border investment of a huge importance for the energy corridor of Southern Europe. The implementation of this project will make possible new investments in renewable energy sector in Albania.

News source/photo credits: Invest-in-Albania



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IMF Releases 53 million Euro Loan to Albania, 3 FEB 15

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Mon, February 23, 2015 15:20:05
3 FEB 15IMF Releases 53 million Euro Loan to Albania

The Ministry of Finance says that the IMF has approved the release of the loan after several months of difficult negotiations and increases in tax and electricity prices.

Gjergj Erebara

BIRN

Tirana

The Ministry of Finance announced on Sunday that the International Monetary Fund board of directors approved the second and third review of the Extended Fund Facility (EFF), allowing the disbursement of two tranches of an IMF loan worth 53 million euros.

“The Excecutive Board of IMF approved the review on 20 February 2015,” the Ministry of Finance said in a press release.

Albania signed a three-year agreement with the IMF on December 2013, promising to consolidate the country’s fiscal position and curb its public debt in exchange for a 330 million euro loan from IMF and further support from the World Bank. The loan is scheduled to be disbursed in nine tranches.

Albania got its first tranche on February 2014 and the second tranche in June. After the second tranche, relations between Albania and IMF soured. On September 2014, the second review of the agreement was postponed while the government had to change its budget law by substituting the missing tranche of IMF loan with debts issued in the domestic market.

In December, the IMF announced that agreement had been reached after the government of Albania approved increased taxation on fuel, tobacco and personal income, raises worth about 112 million euros per year.

Albania also changed its pension scheme by increasing the retirement age, while the Energy Regulatory Authority increased electricity prices.



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Interview with Walter Peeraer, Ceo Of Fluxys, February 19th, 2015

AEI Updates February 2015Posted by Adv. Lorenc Gordani, PhD Sun, February 22, 2015 15:47:41

Interview with Walter Peeraer, Ceo Of Fluxys

February 19th, 2015


Natural Gas Europe had the pleasure to interview Walter Peeraer, CEO of Fluxys. We spoke about the company's investment plans.

Peeraer said that eventual decisions would come after the outcome of the negotiations that just started in Sofia - not before the end of the summer. We also discussed the conditions the transmission system operators (TSOs) need to invest in new interconnectors. "If you don’t have long-term contracts, you need some other kind of collateral to make these kind of investments bankable, for example grants from the European Commission" Peeraer commented.

During your intervention at the EU Energy Law & Policy conference, you mentioned long-term contracts as the backbone of European energy strategy, as a way to make greenfield investments bankable.

Yes, when you want to build brand new gas infrastructure for bringing new gas flows into Europe, you need long-term contracts to make them bankable.

In case of long-term contracts, you said that TSOs would be interested in investing. You said that the alternative condition would be a support from the European Union.

If you don’t have long-term contracts, you need some other kind of collateral to make these kind of investments bankable, for example grants from the European Commission. Such grants however create the risk of distorting competition between projects and discouraging more efficient alternatives. As Fluxys we are prepared to take a part of the risk in such greenfield projects.

When do you expect news that might impact on one of the two conditions (long-term contracts or support from the European Commission)? Do you expect any support from the European Commission any time soon?

There are different solutions under investigation in order to diversify supplies to the countries in the South East and connect them to the rest of Europe. There is the Eastring project in Slovakia, there are projects to bring gas from the Balkan countries to Baumgarten and there are also plans in Poland andRomania. All these projects have their rationale but are also at least partially in competition with each other. This was the case with the Southern Corridor as well: Nabucco and TAP were competing projects, and the producers of Shah Deniz 2, the suppliers of the gas for the pipeline - Socar, BP, Statoil,Total - made the final choice. In the case of the South East countries, I think that one or two of the proposed projects could be chosen but, in the absence of long term contracts underpinning supply, these projects need some form of support from the European Union to be viable.

So you are basically saying that any eventual decision would come after the outcome of the negotiations that just started in Sofia? In other words, you are saying that there will not be any investment decision before the end of summer?

Yes. We are not involved in the negotiations that have started in Sofia but we keep an open eye on the outcome of the process. An infrastructure company like Fluxys is ready to participate in the investment, subject to either long-term contracts or support, and easy access to financing.

During your presentation, you also mentioned another problem. You said that Greece andAlbania represent significant challenges, when it comes down to the permitting process - you basically said it is not that easy to get permits. What do you mean? Can the European Commission do anything to make this process easier?

No. This is a local issue that TAP management has to solve with local governments. Permitting issues are a common hurdle in the pipeline business and hence something we are used to. In Belgium, Germany or France it is not too difficult to get to know what the procedures are and who is the owner of a piece of land. But in Albania, for example, there is no land register and this requires another approach than usual. I do want to insist in this context that projects like TAP not only supply energy but also bring social improvement: TAP will build new roads and bridges, for example, and makes great efforts to enable opportunities for local companies and workforce.

Speaking about the new interconnectors that are supposed to bring gas to Europe, do you see any competitors? What are the other investors that might be interested in taking a stake in these projects? Could pension funds be interested?

When we speak about greenfield projects, in my opinion only suppliers and transmission system operators would be ready to take the risks involved because they are players with an industrial interest and a long term investment outlook. In TAP, for example, we have a combination of producers - BP, Socar, Statoil - and TSOs like Fluxys and Enagas. This is a good ensemble combining different layers of expertise. I personally think that investment and pension funds would only be interested once a greenfield project is commissioned, not before.

Speaking about Fluxys and its investment decisions, what could be the schedule? When could you take decisions on interconnectors and other projects? What are the areas that you are focused on? Is there any regional project particularly appealing from your perspective?

Our central focus is Belgium and NorthWest Europe. Secondly, further away, we look at new gas pipeline or LNG infrastructure that could unlock new sources of gas for Europe. And we also keep an eye on investment opportunities outside Europe which can give a reasonable return to our shareholders. With TAP, additional gas will arrive in Italy, the Italian network is being reinforced to handle flows to the North and our reverse flow project will allow to move the gas further to the North in Switzerland and Germany. From the North of Italy it can also move into Austria. In other words, in the future we will see a corridor from South to North but also from West to East providing reverse flow into South East Europe.

So would you prefer a vertical interconnector from Greece to NorthWest Europe?

No. A southern project to Italy then going up would be fine as well.

Is there any specific project that you would particularly prefer?

We are looking at every opportunity in gas infrastructure that makes sense from a gas business point of view, allows us to develop know-how and brings a stable return to our shareholders. Opportunities outside Europe are in our scope as well. If there would be an interesting LNG project outside Europe that fits in with our strategy, for example, we would certainly have a look at it.

In this case, would the competition be stronger?

For existing assets, it is not unusual to have competition between gas infrastructure companies and investment or infrastructure funds. For greenfield projects however, there is a more cooperative approach between interested parties. But several greenfield projects can be in competition with each other.

Sergio Matalucci

Sergio Matalucci is an Associate Partner at Natural Gas Europe. Follow him on Twitter: @SergioMatalucci



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