Transgaz and FII3M will develop infrastructure projects for the transport of natural gas and hydrogen

By Edwig Ban
The Extraordinary General Meeting of Shareholders of the National Natural Gas Transmission Company “Transgaz” S.A. was held today, the objective of which was to approve strategic projects for the next decades.
Transgaz shareholders have decided to conclude a legal consultancy agreement in order to analyze and negotiate the legal, financial and commercial conditions for the association with the Investment Fund of the Three Seas Initiative (FII3M) in order to attract financing in a cumulative amount up to EUR 626 million for the development of mixed gas and hydrogen transport infrastructure projects.
It is envisaged to set up a joint stock company with its registered office in Romania, in which Transgaz will hold 51% of the capital, and FII3M -49%.
The newly established company would thus develop one or more projects related to the transport of hydrogen through pipelines, which after completion would be sold to Transgaz at a price that would allow the joint venture “to cover its development costs and generate a pre-determined return “for its associates.
The projects will require cumulative funding of up to 626 million euros, which would be provided both by Transgaz and FII3M from its own resources and from financial institutions.
Transgaz GMS also approved the Romanian operator’s accession to the European Hydrogen Backbone (EHB) initiative, which consists of a group of 23 natural gas transmission companies from the mainland that together plan a pan-European infrastructure dedicated to hydrogen transport. The costs of legal advice in order to analyze and negotiate the legal, financial and commercial conditions of association with the Investment Fund of the Three Seas Initiative are estimated by Transgaz at 150,000 euros.
FII3M which was established in May 2019 by the Development Bank of Poland, Bank Gospodarstwa Krajowego (BGK), and the Government of Romania, through EximBank, as an economic expression of the decision of the heads of state and government of the Baltic Sea, Adriatic and Sea region Black to stimulate investment activity in large-scale projects in this area.
Transgaz GMS also approved the Romanian operator’s accession to the European Hydrogen Backbone (EHB) initiative, which consists of a group of 23 natural gas transmission companies from the mainland that together plan a pan-European infrastructure dedicated to hydrogen transport. The costs of legal advice in order to analyze and negotiate the legal, financial and commercial conditions of association with the Investment Fund of the Three Seas Initiative are estimated by Transgaz at 150,000 euros.
FII3M which was established in May 2019 by the Development Bank of Poland, Bank Gospodarstwa Krajowego (BGK), and the Government of Romania, through EximBank, as an economic expression of the decision of the heads of state and government of the Baltic Sea, Adriatic and Sea region Black to stimulate investment activity in large-scale projects in this area. Meanwhile, development banks from Bulgaria, Estonia, Latvia, Hungary, Slovenia, Lithuania and Croatia have joined FII3M. The capital of the Fund has reached over 900 million euros.
FII3M aims to implement projects in priority areas of the Three Seas region (Adriatic, Baltic, and Black), such as transport infrastructure (railways, inland navigation, ports, highways, etc.), energy and digital infrastructure, to support and supplement programs funded by European funds, thus helping to increase EU-wide competitiveness.
The Three Seas initiative brings together the 12 EU Member States between the Adriatic, Baltic, and Black Seas (Austria, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, and Slovenia). The initiative aims to increase convergence and cohesion, while reducing the economic development gap between different areas and the EU Member States, by increasing interconnectedness in the region, in the fields of energy, transport, and digital.