The Macedonian energy market is currently mainly focused on the country's gasification project, despite the lack of movements or developments in the energy sector and legislation this past year.
In fact, some time passed since there was any tangible evidence regarding the gasification of Macedonia, which missed the deadline for the transposition of the Third Energy Package by more than two years.
Nevertheless, it is important to provide a short breakdown of current, ongoing activities regarding the Macedonian gasification process, which is considered the country's main energy focus at the moment.
The Štip – Negotino Section
The construction of a new gas network from Štip to Negotino started in August 2016, and it's being carried out by a Macedonian consortium of 5 companies. The new investment of EUR 16 million in the network will allow it to be 36km long. It will connect to the Klečovce – Štip network, which is 61km long and was completed in June 2016. This construction is expected to finish by the end of 2017.
Besides this section, the following ones are being built:
- Negotino – Prilep – Bitola; and
- Skopje – Tetovo – Gostivar,
This construction work started at the beginning of this year and is expected to be finalised sometime during 2019. The completion of these two segments will conclude the first phase of the gasification of Macedonia.
Gasification of Cities Prolonged While Tendering Continues
Three years ago, after the publication of a notice for construction of a 250km long distribution network in Skopje, in the inhabited areas of the western and eastern region, the Macedonian Government annulled the resolutions by which it was seeking companies for the financing, construction and management of the network.
The Government then stated that they are looking into new resolutions in relation to the procedures for the construction of the distribution of the natural gas network for all three regions. Estimates for the project (the gasification of all 80 municipalities in Macedonia) amount to an 800km long network, approximated at EUR 250 million.
Now in 2017, while the construction of the Negotino – Prilep – Bitola and Skopje – Tetovo – Gostivar sections is developing, the Government published new tenders for a secondary and a tertiary gas network for the gasification of Skopje, as well as the Eastern and Western regions of the country. This is a call for a public-private partnership – and while similar (unsuccessful) calls have been published in the past, the new and improved conditions might provide a successful resolution to the lingering issue that is gasification. Specifically, the duration of the concession is extended to 30 years (previously being 20 years), while government subsidies regarding connection to the system are lower by 20%. Other technical improvements were also announced. The project has an estimated value of 150 million euros.
According to government sources, expectations are that the primary gasification system will be complete by 2020, while 70% of the entire country's gasification will be done by 2022.
The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.