The project entails developing and operating an underground natural gas storage facility (UGS) in the depleted South Kavala natural gas field.
The South Kavala gas field is situated west of Thasos Island in the Gulf of Kavala. It covers an area of 5 km2 and is located 11 kilometers south of the Prinos oil field at a depth of 1,700 meters. Due to its geology, size, proximity to the southern pipeline, existing infrastructure, and uniqueness in Greece, the South Kavala gas field is considered ideal for conversion to a UGS facility.
The South Kavala UGS will be an energy infrastructure that will enhance the security of supply in the Greek market. In the event of an unexpected crisis, the UGS would offset any shortfalls in gas supply at competitive prices by taking advantage of the seasonal gas price spreads. Security of supply benefits are important as Greece moves towards delignitization with natural gas acting as a transition fuel for electricity generation. Furthermore, the security of supply benefits will also be important for the broader region as the UGS would decrease the dependence on westbound pipelines, which, in case of disruption, would leave only LNG as a substitute source.
South Kavala UGS will operate as an additional entry point for the Greek gas market, thus increasing the import route diversification and lowering dependence on a specific supply source for Greece and neighbouring interconnected gas markets. It will thus increase the availability of natural gas during peak demand periods, which will promote the use of natural gas versus high-carbon-footprint fuels.
According to preliminary technical studies, South Kavala UGS should be able to contain a working gas volume of 530 mn Nm3 and operate two cycles per year at a peak withdrawal rate of 9 mn Nm3/day.
Currently, Energean Oil & Gas S.A. retains its interests in the exploration license up to November 2023.
The UGS project has been included in the list of Projects of Common Interest (PCI) adopted in 2017 by the European Commission. PCI status provides eligibility for Capex grant from E.U. and accelerated planning and permit granting process.
Advisors
Financial: PricewaterhouseCoopers Business Solutions S.A.
Legal: Rokas Law Firm
Technical: Seal Energy
The procurement and implementation of the technical studies as well as relevant data analysis for the concession of the South Kavala Underground Natural Gas Storage facility are co-funded by the EU
