Turkey and Greece Finalize Pipeline Agreement

Turkey and Greece have finalized an agreement to construct a pipeline between the two countries for the transportation of natural gas. Greek Development Minister Akis Tzohatzopoulos and Turkish energy minister Mehmet-Hilmi Guler sealed the agreement after the two neighbors had signed a memorandum of understanding on it last year. "This deal will help Greece meet its energy needs and ensure that we act as a transit point for European countries," Tzohatzopoulos told reporters.

The $250 million pipeline will initially be able to transport 3.5 billion cubic meters of natural gas annually to Greece as of 2005 as the country moves to deregulate the sector. Russia is currently the country's sole provider of natural gas, with liquefied gas coming from Algeria.

The EU wants fully to liberalize gas markets by 2006 in order to boost competition and bring down prices. Greece is currently looking into different methods as to how it can pass on the environmentally friendly energy source to its European Union partners. One option is to build an underwater pipeline connecting the country with Italy and another is to transport the gas through its Balkan neighbors.

"Europe needs gas. Its dependence on it will grow in the future," Tzohatzopoulos said. The EU's drive to use cleaner energy sources and technological developments which boost its efficiency are among the factors that will keep demand for gas high, the development ministry said in a statement.