Azerbaijan, Baku, 10 February / Trend , A.Badalova/
The fate of the Nabucco gas pipeline project designed to transport natural gas from the Caspian region and the Middle East to the EU countries and that has recently become the subject of various discussions and debates can be decided later this year. According to the managing director of Nabucco Gas Pipeline International Reinhard Mitchek, 2010 will be a breakthrough for the Nabucco project.
Indeed, this year important decisions are expected to be made on the project, particularly to decide the question of financing, completing detailed engineering and defining the exact route of the pipeline, as well as signing gas contracts with suppliers for the gas supply through it. The fact that 2010 will be decisive for the project is clear, however, it is too early to say whether it would be truly successful for it.
Financing of the project worth 7.9 billion euros still remains one of the most important unsolved problems, which is well understood, and even is no longer denied by the representatives of the project. Mitchek said that the consortium of the project in the near future intends to apply for loans from international financial institutions.
But, despite all positive statements (particularly by the European Investment Bank) regarding the desire to finance the Nabucco project, the preparedness of the IFIs today remains limited. And this is quite understandable. It is unlikely that any organization agree to finance the construction of a pipeline, the final route of which still remains unclear.
According to Vice President of the European Investment Bank Mathias Kollatz-Ahnen, the EIB can provide 2 billion euros credit requested by the Nabucco consortium, but only after the partner countries draft legislation, approving the transit of the pipeline through their territories. Difficult process of harmonizing the legislation of the transit countries is complicated in this project also by a large number of countries, including Austria, Bulgaria, Romania, Hungary and Turkey.
The negative point is the delay of the ratification process of the inter-governmental agreement on the Nabucco project that was signed by the parliaments of transit countries in July last year. In late 2009, the Nabucco consortium stated that the process of ratification by all transit countries of the project will be completed in December. But doday, only the parliaments of Bulgaria, Hungary and Austria have ratified the paper.
Available problems are well understood also by the countries that are considered as potential suppliers of gas for the project, which can not decide to give any guarantees on the project to address them.
One of the important events for the project this year could be the beginning of the process of open season, proposing the sale of the capacity of Nabucco, and further making a final investment decision on the project. As expected, half of the Nabucco pipeline's capacity will be allocated among the shareholders of Nabucco, the other part will be provided to third parties.
Particularly the open season, which will help determine the level of demand for gas transported via Nabucco, will be a decisive event, which according to representatives of the project, will determine its future. According to a board member of the Austrian oil and gas group OMV (operator of the Nabucco project) Werner Auli, the pipeline can not to be built if the demand for gas in Europe is insufficient.
Nabucco project consortium expects that gas demand in Europe will increase by one percent each year, but given the fall in domestic production, respectively, the need to import fuel will increase.
Nevertheless, according to forecasts by the International Energy Agency, it is possible to assume that the gas demand in Europe, indeed, can not pay back the investment in the Nabucco project.
According to the IEA forecasts, over the next five years, the global gas market will experience an excess of supply. In particular, the excess of fuel supply in Europe may reach 200 billion cubic meters by 2015.
Thus, 2010 will be significant for the Nabucco project. Starting building the gas pipeline is scheduled for 2011. The implementation of this project is really interesting and attracting idea, but still there are many obstacles in the way of its realization, to overcome which in a short time is very difficult.
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