State-owned company NOMAGAS (1) plans to build the 67-km North Macedonian section of the gas interconnector. Although promoted as a means of diversifying the country’s gas supply, in reality it would significantly increase gas imports and further lock the country into fossil fuel consumption and associated price fluctuations at a time when it should be decarbonising.
The European Investment Bank signed a EUR 41 million loan agreement for the project in December 2021, just before its self-imposed deadline to halt direct financing for fossil fuel projects. At the same time, an EU grant agreement for EUR 12.7 million was signed under the Western Balkans Investment Framework. The European Bank for Reconstruction and Development is considering financing for the remainder of the project (2).
The first two complaints – to the Energy Community Secretariat and the European Anti-Fraud Office (OLAF) – concern the guarantee for the EIB loan signed by the North Macedonian government for the project in December 2021. The guarantee decision did not pass through mandatory state aid checks by the country’s Commission for the Protection of Competition, potentially rendering it invalid.
In an unprecedented outbreak of efficiency, the North Macedonian Parliament approved the state guarantee on 20 December 2021 and the President confirmed it the same day. It was published in the country’s official journal on 21 December, before the loan signing with the EIB on 22 December.
Pippa Gallop, Southeast Europe Policy Officer, CEE Bankwatch Network – ‘It beggars belief that the EU’s house bank did not do basic due diligence on the loan guarantee approval procedure. This calls into question the guarantee’s validity and harms the EU’s financial interests by unnecessarily raising the likelihood of having to use EU funds to cover the EIB’s losses in case of a loan default.’
The third complaint – also to the Energy Community Secretariat – concerns a breach of environmental impact assessment rules for the project, as North Macedonia’s environment ministry failed to organize a public consultation period. It did not publish any announcement that a consultation was taking place, nor details of how to submit comments.
Ana Colovic-Lesoska, Executive Director, Eko-svest – ‘The EBRD and EIB claim not to finance projects which are not in line with national law. Yet when the North Macedonia government violated basic legal requirements during the environmental assessment process for the gas pipeline, they turned a blind eye. We are confident that the Energy Community Secretariat will confirm our allegations of a legal breach and require the public consultation process to be repeated properly’.
Southeast Europe Energy Policy Officer, CEE Bankwatch Network
+385 99 755 9787
Ana Colovic Lesoska,
Center for environmental research and information Eko-svest
Notes for editors
- Formerly National Energy Resources
- Information about the loans and grants for the project can be found at:
EBRD: https://www.ebrd.com/work-with-us/projects/esia/regional-gasification-project.html (loan amount and approval date not yet published).
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