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Romgaz to buy 20% in Greek LNG terminal project

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The shareholders of Romanian natural gas producer Romgaz (SNG) approved in principle the purchase of a 20% stake in Greek LNG terminal operator Gastrade, according to a statement of the company submitted to the Bucharest Stock Exchange (BSE).

The price to be paid for the stake is nearly EUR 0.4 million but Romgaz is also supposed to contribute EUR 12.5 mln to the development of the project, Bursa daily informed. The LNG terminal is estimated to cost over EUR 370 mln, but it will be partly financed by the European Union.

Greek company Gastrade is the sole promoter and owner of the project for the construction of an offshore liquefied natural gas (LNG) terminal in Alexandroupolis, a city on the Aegean coast.

In addition to approving in principle the acquisition of 20% of Gastrade, Romgaz shareholders also approved the purchase of legal consulting, assistance and / or representation services for participating in the gas terminal project. The construction of the terminal is conditional on obtaining a derogation from the European regulations regarding the common rules for the internal market in the natural gas sector (the unbundling rules, more precisely), the company shows in a document. Gastrade estimates that the derogation decision from the provisions of the directive will be issued in November this year, and the final investment decision in the project is planned for December 2019, a decision that must be taken unanimously by the project shareholders.

Romgaz, which has a market capitalization of almost EUR 3 bln, is 70%-controlled by the Romanian state.

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