Slovenia on cusp of signing gas supply deal with Algeria

Slovenia’s gas trader Geoplin will soon sign a natural gas supply deal with Algeria’s Sonatrach, Infrastructure Minister Bojan Kumer announced on Thursday.

The deal’s details have not been officially disclosed, but multiple media reports indicate Geoplin would purchase 300 million cubic metres of natural gas annually. This would account for about a third of the country’s annual gas consumption.

“To our understanding, the contract will be signed any day now. We will help to make it happen within the scope of our powers,” Kumer said.

Prime Minister Robert Golob said a few days ago that the contract would be for a minimum of three years.

The gas would be imported through Italy via an existing pipeline that has sufficient capacity.

While the gas is badly needed since Geoplin, by far the country’s largest importer of natural gas, typically imports roughly three-quarters of annual gas volumes from Russia, there are still some snags.

The business newspaper Finance reported that energy company Petrol, which owns 75% of Geoplin, has made the contract conditional on recovering money it lost due to a fuel price cap in place during the term of the previous government.

Kumer said he was not aware of this.

Another issue is the financial standing of Geoplin. The government has set aside up to €700 million for a capital increase in this year’s budget, a move which would effectively lead to the company’s nationalisation.

However, some reports suggest that Geoplin does not actually need a capital supply, but rather a liquidity loan.

“It is key that, if the need arises for a financial injection, the state does this fast and effectively. Different scenarios need to be examined,” Kumer said.

(Sebastijan R. Maček | sta.si)