EIB, Greece Sign Financing Deal for Energy Projects

The European Investment Bank (EIB), EU's lending institution, and Greece signed a 285 million euro ($312.4 million) deal on Tuesday, extending financing for energy projects in the country.

Last year, the EIB agreed to provide Greece total loans of 670 million euros for extending and upgrading its power grid and a liquefied natural gas (LNGLF) (LNG) terminal on an island close to the Greek capital.

On Tuesday, the EIB and Greece signed four financing agreements to disburse the second tranche of the 2014 loans.

Greece is in a dire need of funds as it struggles to kickstart its economy which has lost about a quarter of its output since a debt crisis began in 2009.

"As the bank of the European Union, we must, through project finance, be part of the solution of the problem for the Greek economy," EIB Chairman Werner Hoyer said on Tuesday at a ceremony to sign the agreements.

"We all support this country in a difficult transformation process."

Under the new agreements, Greece's dominant power utility PPC will get a credit line of 245 million euros to install engines for power production on 18 Greek islands and interconnect Cyclades islands to the mainland network.

The remainder will support the extension of an LNG station, owned by the country's gas system operator DESFA.

The EIB has offered total credit lines of 7.7 billion euros to Greece in the 2010-2014 period.

(Reporting by Lefteris Papadimas and Angeliki Koutantou)