Before Albania can have gasification, it will need to have a functioning economy, a population wealthy enough to afford the costs of central heating and cooling, schools, kindergartens and nurseries equipped with air conditioning, and a substantial industrial base capable of consuming a volume of gas large enough to justify the multibillion euro cost required for the basic infrastructure.
By Gjergj Erebara
The year is 2016. The then Minister of Energy, Damian Gjiknuri, announces the plan for the “gasification of Albania.” According to a news report from that time, Albania planned to build five main gas transmission lines: one toward Macedonia, one toward Montenegro, one toward Korça and one toward Gjirokastra.
The year is 2021. A cooperation agreement is signed, as usual, in the presence of Edi Rama, between the Ministry of Infrastructure and Energy, this time headed by Belinda Balluku, and ExxonMobil and Excelerate Energy. According to the Council of Ministers’ announcement, the agreement aimed at “the construction of a new gasification terminal and the distribution of LNG, turning Vlora into a regional hub for liquefied gas.”
The year is 2026. The Albanian gas company, and yes, we do have one, signs a “memorandum of understanding” for nothing less than the “gasification” of Albania. Another minister, Enea Karakaçi, speaks, just like Gjiknuri did eight years earlier, of an extraordinary vision. A figure is also mentioned, one that makes your eyes pop: $6 billion.
There is a strong chance that, eight years from now, another minister, or perhaps one of the previous ones, will sign yet another memorandum of understanding “on gasification.” We cannot predict the future, but we can understand the past by digging through the archives.
In 2012, Sali Berisha, then prime minister, promised “gasification” as a major objective of his four-year mandate, which never came.
In 2013, meanwhile, Socialist Deputy Prime Minister Niko Peleshi declared that he had discussed “gasification” in Israel.
In 2022, Edi Rama spoke of “concrete steps” toward the gasification of the country, this time with the help of Azerbaijan.
As can be seen, there has been no shortage of ideas in the past about where and how Albania’s “gasification” might come from. The difference this time is the pomp. The fantastic figure of $6 billion has been presented as the value of the agreement with one Greek company and another American one.
Gas is a fossil fuel that ignites and produces energy. As its name suggests, it is found in nature in a gaseous state. The problem is that there is a physical distance between the place where gas is found in nature and the place where it may be needed by the consumer. Gas is said to exist in abundance in nature, and if there is no infrastructure to transport it to the consumer, it is simply burned off. The problem, therefore, is not the source of the gas, which, according to the above mentioned news items produced by governments, could come from Azerbaijan, Israel, the United States or other countries, but the infrastructure.
For example, the latest news from the United States speaks of a “gas glut.” There is plenty of gas, but nowhere to send it.
At present, there are two ways in which gas can be transported. The first is transportation in a gaseous state, as the Trans Adriatic Pipeline does. Gas is injected into a pipeline at the place of production and transported through pipes to the consumer. The second is to cool the gas to ultra-low temperatures, minus 162 degrees Celsius, after which natural gas shrinks in volume by 600 times and can then be loaded onto ships and sent to the consumer.
Both methods, pipeline transport and transformation into a liquid state, require major infrastructure investments. Once gas has been liquefied and loaded onto ships, it needs a place where it can be regasified, and then pipelines to transport it to the final consumer, whether industry or households. A regasification plant costs hundreds of millions of euros, while laying pipelines across cities is a major undertaking. Above all, because of the high costs required by the initial investment, gas supply is a multi-year project in which the parties usually commit to take-or-pay contracts. In other words, the consumer agrees with the supplier to pay for the gas regardless of whether it is able to consume it or not.
Between the two options, Albania could naturally seek the ready-made solution: supply from the Trans Adriatic Pipeline, which is available. Albania even enjoys transit rights, including the right to purchase the transportation of a certain amount of gas at a preferential price. To this day, that right has not been used, not because gas does not exist, but because there is no consumption.
The solution some countries have found to guarantee steady gas consumption has been the construction of thermal power plants for electricity generation. In such a scenario, one would need to build a power plant with a minimum capacity of 600 or 800 MW in order to guarantee consumption of around 1 billion cubic meters of natural gas per year, which is the minimum in this field. Albania has still not managed to put into operation a 100 MW thermal power plant that was built fifteen years ago, and it has no plan to build another one. Consequently, in order to gasify the country, one would have to look at other potential consumers. Cement factories are potential candidates, but they appear to be insufficient.
For the general consumer, meaning the household that uses gas instead of electricity for heating and cooking, this is likely a vain hope. The Albanian citizen is poor. In winter, he usually heats only one room and covers himself with blankets. In summer, he anxiously looks at the higher electricity bill caused by air conditioning. And as the population ages, with entire towns now having a substantial share of resident pensioners, it is difficult to find consumers wealthy enough to justify the extraordinary costs required to lay gas pipes to every home.
As a result, although there is no shortage of gas in the world, Albania is a backward country, without industry and with poor consumers. This is what makes news about gasification reappear every few years, with actors who sometimes change and sometimes do not, and who make bombastic declarations.
