Gas pipeline competitors: trump card for Azerbaijan - Trend Capital commentator

Gas pipeline competitors: trump card for Azerbaijan - Trend Capital commentator

Azerbaijan, Baku Feb. 13 / corr. Trend E.Tariverdiyeva /

All possible versions of the export of Azerbaijan's gas to Europe, including three pipelines - Nabucco, Trans Adriatic Pipeline (TAP) and Poseidon (Turkey-Greece- Italy), are excellent tool for Baku to obtain great economic benefit. Each of these projects has their advantages and disadvantages and each is considered as possible version for the export of Azerbaijani gas.

The result of negotiations depends exclusively on the conditions of the proposed commercial deal and position of Turkey as a transit-country for three gas pipelines.

The present visit of the President of Turkey Abdullah Gul to Moscow became the last, but not the only reason for the concerns of Europe over the future delivery of gas.

Future diversification of the gas supplies to Europe through the three above-mentioned gas pipelines finally depends on Ankara, which recently does not demonstrate special friendliness towards the European Union not accepting it. The last incident with the Prime Minister of Turkey Erdogan at the Davos forum vividly illustrated the attitude of the country towards constant refusals for membership to the European Union and talks of the new American administration regarding recognition of Armenian "genocide".

But besides the problems with Turkey, there are other important issues with the gas pipelines.

When in 2002 Europe spoke of the diversification of gas supplies, Nabucco project remained unrealizable dream of the EU for one simple reason. The oil prices, on which depends the gas price, were too low, and design cost of Nabucco was not justified by fuel price. The entire beginning changes, when the price of "the black gold" fell to $40 per barrel. Nabucco became possible and even necessary, but another question arose in this stage: where to take gas for the pipeline with the maximum capacity of 31 billion cubic meters per year.

The initial idea of Nabucco - supply of gas from Central Asia and Azerbaijan to Europe through Turkey, Balkan countries to the Austrian city of Baumgarten. And still no one can promise sufficient volumes of "blue fuel" for Nabucco. The tariffs on the gas transport, which will pay the supplier, directly depend on the original cost of the pipeline. Even taking into account the use, at the initial stage of project, the part of the ready infrastructure in Turkey, Nabucco does not pretend to the title of cheap gas pipeline, and therefore, its tariffs will be high. Taking this into account, it becomes clear that the construction of the pipeline with 31 billion cubic meters per year, via which only 10-15 billion will go, can be unprofitable.

However, idea of using the possibilities of competitory ways of gas supplies already brought huge benefits to some countries, for example Turkmenistan - main hope for Nabucco as the supplier of fuel from Central Asia.

During mentioning of Russia, buying gas for the small price many years, about the possibility of selling gas to China or joining Nabucco, Ashkhabad obtained acceptable price for itself and left the possibility to competently mention the competitors in the future gas deals with Russia.

Now Moscow will do everything in order not to give the Central Asian countries the ground to think of diversification of their deliveries, proposing more advantageous conditions of sale-purchase, without special damage for itself. Russia has a sufficiently developed infrastructure of accepting and pumping Central Asian gas, which covers many years of use, while the same Nabucco - new pipeline with still unclear tariff schedule and the need for justifying expenditure on its construction.

A similar method for obtaining the most advantageous conditions of the commercial deal can be used by Azerbaijan as well. Theoretically, this is not necessarily that Azerbaijan's gas will be pumped through Nabucco, and also this is not necessarily that Nabucco will pump Azerbaijan's gas. Especifically, the presence of competitory gas pipelines creates comfortable conditions for Azerbaijan.

Poseidon can be alternative gas pipeline for Azerbaijan's gas. 8-10 billion cubic meters of gas, which are already generated by only Azerbaijan, is sufficient for it. Moreover, Poseidon already has not-developed, but really existing infrastructure - the pipeline, which connects Turkey and Greece. For the completion of the pipeline, it is sufficient to finish construction of the part of pipeline, which connects Greece with Italy.

Technically the capacity of Poseidon can be increased to 13 billion cubic meters of gas per year. It is necessary to understand that the really existing gas pipeline is smaller expenditures for investors and smaller tariffs for the transportation of gas. In addition, in the destination - Italy - there is a branched network of pipelines and excellent infrastructure.

Another gas pipeline, which passes through Turkey to Europe - TAP, possesses almost analogous characteristics.

All three pipelines are considered by official Baku as possible for gas supplies to Europe and they are convenient versions for obtaining more advantageous proposals.

Is not worth to lose the possibility to sell Azerbaijan's gas to Russia, which attempts to solve problem with the transit through Ukraine, constructing a new pipeline system - South Stream, which will connect Russia and European Union via Black Sea. With this one project, Russia will cover almost entire Europe, passing through the Balkan countries, Greece, Italy and Austria.

If there is gas, the buyer will be found. The more pretenders on fuel, there are more chances to obtain not only more advantageous proposal from the buyer, but also additional geopolitical bonus.

Do you have feedback? Contact our journalist at: [email protected]

Subscribe to Trend in Google News! Subscribe
Oil production on Turkmen Cheleken peninsula exceeds planned volume
Oil production on Turkmen Cheleken peninsula exceeds planned volume
Turkmenistan’s president approves anti-crisis program for 2022
Turkmenistan’s president approves anti-crisis program for 2022
Turkmen gas may be supplied to Europe via Caspian Connector project - ambassador
Turkmen gas may be supplied to Europe via Caspian Connector project - ambassador
Loading Bars
Kyrgyz Cabinet aims to increase share of electric vehicles in country
Azerbaijan shares data on number of vaccinated citizens
Azerbaijan confirms 1,394 more COVID-19 cases, 1,791 recoveries
Kazakhstan increases petroleum oil exports to France
Volume of cargo loaded/unloaded in Iran’s Bandar Lengeh port decreases
Iran boosts aluminum ingots production
COVID-19: 11 areas of Kazakhstan in ‘green zone’
Cargo train services launch between Georgia, China
Iran reveals COVID-19 data for December 5
Turkey, Italy work together for regional peace, stability: FM
Tripartite deal to solve main part of Iran’s gas problem - Chief of Staff of Iranian President
Oil production on Turkmen Cheleken peninsula exceeds planned volume
State Customs Committee discloses TOP-5 trade partners of Azerbaijan
State Customs Committee reveals trade turnover between Azerbaijan and China
Azerbaijani Defense Ministry presents weekly review (VIDEO)
Georgia reports 3,410 coronavirus cases, 4,732 recoveries, 46 deaths
At least 14 civilians mistakenly killed by Indian forces in remote northeast
Iranian currency rates for December 5
Kyrgyzstan confirms 42 new COVID-19 cases
New Year budget to depend on activities’ scale - Tbilisi Mayor
Iran’s SPGC shares data on production of its fifth refinery
Baku International Sea Trade Port unveils cargo transshipment for 10M2021
Pakistan receives $3 billion loan from Saudi Arabia
VISA open to co-op with all key players in Azerbaijan’s transport sector (Exclusive)
6.1-magnitude earthquake rattles southern Philippines
Soyuz-ST-B with 2 Galileo satellites launched from Kourou spaceport
Dutch former queen Beatrix tests positive for COVID-19
10 mln French have received COVID-19 booster shots: minister
Iran abandoned any compromises in latest nuclear talks - U.S.
Chile reports first case of Omicron variant
White House confirms plans of holding video call between Biden and Putin on December 7
Vienna talks on Iran nuclear deal to resume next week - Russian Foreign Ministry
1 killed, 40 injured following volcanic eruption in Indonesia
Body of another Armenian serviceman found in Azerbaijan's Khojavand
Bitcoin tumbles 9.95% to $48,397.56
Passenger transportation via Iran's Kermanshah International Airport declines
UK records another 42,848 coronavirus cases
Explosion occurred near Iran's nuclear facility
Azerbaijan hands over to Armenia body of saboteur neutralized in attack on Azerbaijani serviceman in Khojavand
Azerbaijan talks entreprises to be commissioned at Aghdam Industrial Park
Major terrorist attack against rally with Erdogan's participation prevented in Turkey
Great number of EU, NATO countries interested in Turkish drones - Cavushoglu
Georgian PM meets with President of FIBA Europe
OSCE MG ready to host meeting between Azerbaijani and Armenian FMs
Value of Azerbaijan's export to US surges for 10M2021
Prices on several main food products in Kazakhstan continue to lower
Agrarian sector of ‘smart village’ in Azerbaijan’s Zangilan to be combined modern urban planning – minister
Azerbaijan discloses project cost of agropark in Yevlakh (PHOTO)
Buy/sell operations at Iran Mercantile Exchange down
Saudi Arabia, France agree to strengthen cooperation
Biden, Putin to hold video call on Tuesday
India, Australia are natural economic partners, says Tony Abbott
Azerbaijan receives mine maps of its territories liberated from Armenian occupation
Erdogan discusses humanitarian aid with Red Crescent, Red Cross
Uzbekistan intends to increase dried fruit exports to China
No Omicron strain detected in Georgia - NCDC Head
Aligarh’s Areeba shoots to fame, breaks stereotypes about Muslim girls
Iran’s Bahar Azadi gold coin price skyrockets
Azerbaijan shares data on number of vaccinated citizens
Azerbaijan confirms 1,406 more COVID-19 cases, 1,787 recoveries
Tactical exercises held in Azerbaijan's commando military unit - MoD (PHOTO/VIDEO)
New composition of Supervisory Board of Azerbaijan Industrial Corporation approved
Iran reveals COVID-19 data for December 4
President Ilham Aliyev sends congratulations to heads of Thailand, Finland
France, Europeans working to open joint mission in Afghanistan - Macron
Ranking of natural gas importers from Azerbaijan
Uzbek Commodity and Raw Materials Exchange reveals volume of its transactions
SOCAR Georgia Gas announces tender on gas stations restoration
Iran eyes increase in passenger transportation via Yazd Shahid Sadooghi Airport
Azerbaijan reveals oil exports to Canada in 10M2021
Weekly review of main events in Azerbaijan's transport sector
Turkmenistan’s president approves anti-crisis program for 2022
Azerbaijan’s liberated territories have high potential for solar energy - RES agency
Weekly review of key events in Azerbaijan's ICT sector
Russian company to help automate, digitalize processes in Uzbek energy sector
Iran reaches increase in load/unload operations in Shahid Bahonar port
Top 10 Azerbaijani oil importers
MFA reveals reason why Armenia-Azerbaijan ministerial meeting didn't take place
Kazakhstan talks construction of wind power plants in Kostanay region
Azerbaijan achieves practical results to restore hydropower plants in liberated lands - agency's CEO
Azerbaijan’s metallurgical company notes increases in steel production over 9M2021
Iran also to be able to take advantage of Zangazur corridor – ex-Iranian ambassador to Azerbaijan
Russia-UAE trade turnover hits fresh all-time high surpassing $4 bln - Mishustin
Kazakhstan’s Almaty Power Plants to buy pumping, ventilation equipment via tender
Azerbaijan discloses oil exports to Ukraine over 10M2021
Azerbaijan unveils volume of oil exports to Belarus in first 10M2021
Georgian Railway shares updated report on income within 9M2021
Azerbaijan’s 10M2021 oil exports to UK revealed
Kazakhstan to timely fulfill its obligations under COP26 – PM
Azerbaijan opens investment tender to privatize Sumgayit Construction Service company
Iran finds way to supply its far north, north-east provinces with gas
Georgia releases COVID-19 data for December 4
LUKOIL Uzbekistan Operating LLC opens tender for supply of shut-off and control valves
Mikheil Saakashvili not to be treated abroad – Georgia's minister
Russia offers Azerbaijan to switch to barcoding for fruit, vegetables exports
Tripartite gas swap deal with Turkmenistan, Azerbaijan, may help Iran kill two birds with one stone
Azerbaijan Mortgage and Credit Guarantee Fund issues record amount of loans in 10M2021
Goods movement across Azerbaijani-Russian border to be accelerated
Azerbaijani oil prices increase
Kazakhstan boosts trade with Romania over 9M2021
All news