Socar to hold DESFA deal talks in Athens

TAGS: Privatizations, Energy

Azerbaijan’s state energy company Socar plans to hold talks with Greek officials over a deal to buy Greek natural gas pipeline operator DESFA, Socar’s president said on Friday.

In 2013, Socar agreed to 66 percent of the crisis-hit gas supply grid operator for 400 million euros. But the deal stalled after Socar was ordered to sell 17 percent of DESFA to a third party to satisfy EU competition authorities.

Complicating the sale further, Greece passed a law in July raising DESFA’s gas tariffs from next year by a much lower amount than expected.

“Our delegation will hold negotiations in Greece on September 27-28,” Rovnag Abdullayev told reporters.

Socar officials say the company was ready to go ahead with the deal but DESFA’s price should be substantially cut.

Socar’s letter of guarantee for the acquisition expires next Friday.

Italian gas grid operator Snam is still interested in buying a 17 percent stake in DESFA from Socar to satisfy the EU competition conditions, the Azeri company has said.

DESFA’s sale is part of a privatization program required under Greece’s international bailouts and is expected to raise 188 million euros for state coffers this year.