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Weekly review of Azerbaijan's energy sector

Economy Materials 6 February 2023 14:17 (UTC +04:00)
Weekly review of Azerbaijan's energy sector
Maryana Ahmadova
Maryana Ahmadova
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BAKU, Azerbaijan, February 6. Last week Azerbaijan's Baku hosted the 9th Southern Gas Corridor Advisory Council Ministerial Meeting and 1st Green Energy Advisory Council Ministerial Meeting.

As President Ilham Aliyev said, addressing the participants of the meeting, only with three major energy companies, Azerbaijan has agreed and signed MoU and agreements to produce up to 25 GW of renewable energy offshore and onshore solar and wind.

President Ilham Aliyev also noted that Azerbaijan is in process of negotiations to evaluate the opportunity to build a 500 MW solar power station in Nakhchivan.

On the sidelines of the meeting, Ministry of Energy of Azerbaijan and Saudi Arabia's ACWA Power have signed several documents, such as an agreement on the implementation of a 1.5 GW offshore wind power project in Azerbaijan, memorandum of understanding on the implementation of an onshore wind energy project with a capacity of 1 GW, and memorandum of understanding in relation to development of a Battery Energy Storage System in Azerbaijan.

Also, during the press conference, following the advisory council, Minister of Energy of Azerbaijan Parviz Shahbazov has noted that the working group will be established within Azerbaijan's green energy supply project to Europe.

"Azerbaijan, Georgia, Romania, and Hungary took a historic step in December 2022 and agreed to connect the Caspian Sea with Europe via the green energy corridor. In the second phase, 3-4 GW of green energy is planned to be supplied along this route, which will become the green energy corridor of the 21st century. Today we discussed plans for the further implementation of this project, as well as the development of green energy. The quadrilateral working group will be established," he said.

The minister also noted that Azerbaijan has partly started signing new gas supply contracts with customers, even relevant memorandums have been signed.

"For example, agreements on gas supplies were signed as part of Azerbaijani President Ilham Aliyev's visit to Hungary, and this process is successfully continuing," he added.

Meanwhile, Romania’s Minister of Energy Virgil Daniel-Popescu said that Romgaz and SOCAR intend to improve the mechanisms for the delivery of natural gas from Azerbaijan to Romania.

"The project would include a natural gas liquefaction terminal and a regasification terminal, as well as other facilities and installations needed to transport gas from the Caspian Sea basin to Romania. Also in December 2022, Romgaz and SOCAR TRADING, a subsidiary of the State Oil Company of the Republic of Azerbaijan, signed the first individual contract for the delivery of gas from Azerbaijan to Romania. The individual contract allows for scheduled gas deliveries from 1 January 2023 through the Southern Corridor using the transmission capacities of the TAP and IGB pipelines and the transmission systems in Bulgaria and Romania," he said.

At the same time, Kadri Simson, the EU Commissioner for Energy, said that the European Commission certainly supports projects that could further help diversify gas supplies in the region. In regard with the newly-proposed project by four European countries to boost gas imports from Azerbaijan, she noted that Bulgaria, Romania, Hungary, and Slovakia are considering using existing and new infrastructure as a new corridor for importing gas.

"Central-Eastern and South-Eastern Europe are amongst the most dependent regions in Europe when it comes to gas imports from one single source. At the same time, the diversification of supplies, routes and sources have been significantly improved in the past few years, thanks to the EU infrastructure policy, the realization of Projects of Common interest under the TEN-E, and in some cases financial support through the Connecting Europe Facility and other instruments. Nevertheless, if there is a market interest, the Commission certainly supports projects that could further help diversify gas supplies in the region," she said.

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