ALBANIAN
ECONOMY TO FLUORISH WITH TAP, OFFICIALS SAY

March 26th, 2015

Albanian government officials have gone on record to promote the Trans
Adriatic Pipeline (TAP), stating it will be a good investment for Albania and
its economy.

All the necessary documentation for
building this project, which will transport gas from the Caspian Basin through
Turkey, Greece and Albania before reaching the coast of Southern Italy, is
ready with construction expected to start in 2016.

The construction of TAP is not expected
to significantly impact the EU’s move to reduce dependency on Russian supply;
however, it will have an important bearing on the economies of states in
southeastern Europe including EU member Greece.

Natural Gas Europe has
the opportunity to receive the views of Ilir Bejtja, Deputy Minister of Energy
& Resources of Albania
on
the TAP project and natural gas in Albania.

”This is the opportunity for
gasification of the country. Albania will have three connection points for
natural gas and this will give us the opportunity to play a key role for
supplying Balkan states”, commented the Deputy Minister.

He emphasised that the country will
reduce the use of electrical energy, which is now the only source of energy in
the country, adding that all political forces in Albania are in consensus on
this matter.

Albania plays a key role in the
development of the Southern Gas Corridor through the passage of the TAP
pipeline. What has Albania done so far regarding the building of TAP and what
is it planning to do in the future?

“We have already fulfilled previous
obligations, including voting in parliament, voting on the project and track of
TAP and – as far I know – we have also concluding the tender for the building
of a road for the construction of the pipeline. The government of Albania is
also in the process of issuing licences for building TAP. So far, there
are no obstacles to report for this project. Albania will have three connection
points for natural gas, and this will give them the opportunity to play a key
role for supplying Balkan states which are related to Ionian Adriatic Pipeline
with natural gas, and they will get the chance to benefit from their resources
and their own production. Albania now only has one source of energy: electricity.
With the building of TAP, Albania will have the opportunity not to depend on
only one source of energy. This will make it possible for the economy to
grow at a quicker rate.

What are the characteristics of the
Albanian segment of TAP and how will the building of this pipeline impact the
country’s economy?

“The pipeline section is 217
kilometers long, there will be three gas connection points, it will involve
about 2,000 workers and it is estimated that around 500 million euros will
enter the Albanian economy in terms of work, facilities, taxes, etc. Many
domestic companies will be involved in the project. For example, there is
now one Albanian-Italian joint venture which will be doing the work on
infrastructure for the pipeline. Another benefit will be diversification of
energy sources through the gasification of the country. Houses will finally
have the opportunity to use gas for personal use. It will also be a part of
Albania’s regulatory framework for energy. In general, this will have a big impact
on Albania’s economy since this is one of the biggest energy projects in the
country. With this project, it became possible to forge new
relationships. Albania is now working with Azerbaijan in order to benefit both
countries from this cooperation”.

Is there a full political support for
building this pipeline in Albania?

“Yes, it has the consensus of all
political parties. This project was not initiated by the Socialist party which
is now in power, but the former ruling establishment. That being said, the new
government has supported this project because it is in the best interests of
the country”.

At the latest meeting with the officials
from Azerbaijan, you agreed that a special working group be formed to undertake
a master plan for developing Albania’s gas market. Can you tell us more
specifically what this master plan will bring to Albania?

“Right now the country is focused
on gas distribution for final consumption in Albania. It is about gasification
of the country, which means that the natural gas should come to all areas where
it was never before. That means urban areas, industrial areas and in that way
the country will increase consumption of gas and reduce consumption of electric
energy, impacting directly on projects heavily dependent on energy efficiency.
Consumption of electric energy is very much dependent on weather conditions. By
having another source of energy that is constant means that Albania will have
much more energy. The government plans to redistribute and reallocate
investments in this sector and transport it to other sectors which have been
left behind because of a lack of funds. That is the main reason behind the
creation of the master plan. Albania will consider how to develop this master
plan through projects which will be financed from the state budget and from
partnership funds.”

In 2014, Albania started implementing a
package of reforms in the energy sector. What has been done so far?

“Albania has done a great deal of
work. To provide a bit of background, in 2013, Albania started with a loss of
217 million dollars in its energy sector. In 2014, this number is planned to be
reduced to 180 million dollars. But Albania has moved further: debt has been
reduced to 45 million dollars. We achieved this through a series of actions, regulations
and modifications. That number will be even smaller by the end of this year.
The government is working to change the situation further and to contribute to
the state budget in the future and not to take any more money from the budget
like it has so far. This year, it is planned to finance the state budget with
about 130 million dollars of support. At the end of the year, Albania will
definitely be at zero and only contribute to the budget in order to improve its
negative account that has been dragging for years. The situation will be quite
different. This will help the country to increase its investments in the energy
sector and to be much more confident with its relationships with banks and
other financial institutions and partners. I do not not believe Albania will be
super energy force, but will be positive contributor”.

Albania has also taken over the
chairmanship of the Energy Community, on January 1. 2015. What will be the
goals that the country will try to achieve in the period of one year and where
does the country currently stand when it comes to Third Energy package reforms
of EU?

“Very
soon, Albania will have a new laws. The basic law in the power sector will
regulate and consolidate all the renewable energy sources in which the country
has been lagging development. Albania will also introduce a law about
hydrocarbons and building efficiency, which is all a part of Third Energy
Package. These laws, among others, will be a push forward in its role in the
energy sector of the Balkan and European markets. The participation in TAP and
IAP is also showing that Albania is playing an important role by pushing
forward these two projects which are very important for Western Europe’s
countries as well. Albania’s participation in the Energy Community will also be
useful for other countries to move forward and to changing the energy sector.
Albania is also going to liberalise the consumption market. By moving in that
direction, the country will have a free competitive market, which is integrated
with other countries. Regional projects and cooperation with neighboring
countries: Kosovo, Macedonia, Greece and Italy will put Albania in the role of
energy dispatcher, which is distributing energy to regional