Karanovic & Partners
  July 22, 2016 - Serbia

Slovenian Gas Pipelines To Be Brought Under State Control

According to latest news reports, Plinovodi – the company managing Slovenian gas pipelines, will be brought under majority state control, while the energy company, Petrol, is due to secure a majority stake in the gas wholesaler Geoplin under a contract signed this month. It should be noted that the Slovenian Sovereign Holding (SSH) and Petrol are currently the largest Geoplin shareholders. Geoplin, in turn, is the sole shareholder of Plinovodi.

The SSH and Petrol signed this share swap contract nine months after the Slovenian government endorsed the plan in question, and it is expected to be implemented once all of the remaining regulatory hurdles have been cleared. It has been reported that the goal of this multiple-stage transaction, will be for Plinovodi to become spun off from Geoplin and turn into a majority state-owned company. In return, Petrol is meant to gain majority control over Geoplin, with the Slovenian state retaining only a controlling 25% stake.

Looking at it from a future perspective of the state's asset management strategy, Geoplin will remain designated as an important investment in which the state plans to retain controlling stakes, while Plinovodi will be declared as a strategic asset to be retained in majority state ownership, much like other key infrastructure companies (i.e.) the power grid operator Eles.

In order to shed some light on the energy context in Slovenia, it should be said that the country depends almost entirely on natural gas supplied from abroad. Most of it – as much as 42 percent – is supplied from Russia, 35 percent from Austria, 16 percent from Algeria. The remaining amounts of gas are supplied from Italy. The Slovenian gas transmission network consists of 1,121 km of pipelines. An important part of the transmission network are compressor stations in Kidricevo and Ajdovscina, which maintain the required pressure in the transmission network. 

Read full article at: https://www.karanovic-nikolic.com/knnews/Pages/2016/07/22/Slovenian-Gas-Pipelines-to-be-brought-under-State-Control.aspx