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Gazprom was the privileged candidate for DEPA

13 June 2013 / 18:06:45  GRReporter
3540 reads

Victoria Mindova

The news of the failed deal of Greek gas company DEPA’s sale was swept away by the announcement of the closure of the state broadcaster ERT. The problem of the collapse of the privatization, which is the most important part of the programme of the three-party coalition government in Greece, remains on the agenda whether local media reflect it or not.

Although the macroeconomic indicators of the country have been improving, the end of the crisis is still far away. The privatization of key state enterprises is the basis of the programme to attract foreign investment.

After the sale of 33% of OPAP, the privatization of the state-owned gas company was the most important deal that the Greek government could have completed to show foreign investors that the country is ready to turn a new page.

However, the deal has failed, leaving many questions without answers. The Russian gas giant Gazprom clearly stood out among the rivals for the purchase. In recent months, Gazprom’s Deputy Chairman of the Board of Directors Alexei Miller had visited Athens several times. He met face to face with Prime Minister Antonis Samaras and representatives of the company. The government paid special attention to the Russian company, which has unexpectedly withdrawn from the deal.

We have sought the opinion of Panos Michalopoulos, a representative of the Drasi party, who comments on the developments as an independent observer.

How would you comment on the failure of the deal of DEPA’s sale?

A clear framework for the functioning of the market is necessary before starting the privatization of a state monopoly such as the national gas company DEPA. This means that a proper legal basis for the formation of the market in favour of the consumer should be established first and then subsequently the tender for privatization should be announced.

Another problem associated with DEPA’s privatization was the relationship between the government and Gazprom. The procedures to be implemented during the tender were superficial and opaque.

What do you mean?

It is impossible for the government to officially announce that there were a series of meetings with Gazprom related to the price of the privatization deal and for the natural gas price, and then for the whole process to fail.

It is impossible for us to find out at this point that we will buy natural gas at a price that is 30% higher than the average in Europe and to believe that the tender was conducted properly and in the interest of consumers.

The whole procedure and the special attention the government had paid to Gazprom excluded other investors from the process. They did not have direct access to the Prime Minister's office, as was the case with Gazprom.
This is a very serious problem in itself because it makes the country unreliable in the eyes of foreign investors, regardless of whether it concerns DEPA or another company that, until now, has held the state monopoly in a particular sector.

So, do you believe that it had been largely predetermined who would receive the gas company?

When there is a special organization such as the Privatization Agency but all meetings and decisions pass through the Prime Minister’s office, it is clear that the processes of DEPA’s sale are not in accordance with the accepted rules. If so, why has a formal public tender been announced and why has an Agency been established, which is deprived of the right to do its job.

How would you comment on the price of natural gas to Greece? Do you think that there are violations in this regard?

There is a problem with the prices in the energy market in Greece in general. We have recently realized that we are buying natural gas at significantly higher prices than other European countries, whether they are members of the European Union or not. This is a heavy burden for the activity of the Greek industry. New data on the state of Greek production are constantly being published. Manufacturers are trying their best to keep the factories and workshops in the country but many of them either close or transfer their activities to other countries where electricity prices are much lower.

What, in your opinion, is the cause of the higher price of natural gas in Greece in comparison with its average value in Europe?

The first reason is a bad arrangement on the part of the seller which, in this case, is the Greek government. I think that the talks related to the prices of natural gas were not properly carried out in order for us to ensure a price closer to the average value accepted in Europe.

We do not know whether this is the result of international pressure or of other interests behind this deal. What is clear is that the specific deal is not in favour of the Greek households or of DEPA’s industrial customers who consume natural gas.

Do you believe that the informal intervention of Brussels in DEPA’s privatization, which is being widely discussed at present, has been in Greece’s favour?

The truth is that there is no concrete evidence of Brussels’ interference in the process. Even if this is so, the Greek government remains responsible for the completion of the deal. It must inform both the European Commission and the consumers about the course of things.

Tags: EconomyCompaniesGazpromDEPAPrivatization
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