Azerbaijan, Baku, September 18 / Trend , A.Badalova /
One of the main components of the European energy policy today is to diversify energy supplies, which, at the same time, according to many European high-ranking officials, is the main guarantee of security of supply. The issue of diversification became even more urgent after the gas crisis that occurred in late 2008 - early 2009 as a result of disruption of gas supplies to European countries. Thus, today Europe enthusiastically seeks ways to reduce energy dependence on Russia.
Europe's main and most priority instrument for achieving this goal is the Southern Gas Corridor project, which includes projects such as Nabucco, Trans Adriatic Pipeline (TAP), Turkey-Greece-Italy gas pipeline (ITGI), White Stream. According to representatives of these projects, they are not competitive, but rather complementary projects. In fact, it is not so for one simple reason: the basic, but more precisely, primary source for all these projects is the Azerbaijani gas, which is the object of competition for the European companies.
According to the data provided by BP, the proven gas reserves of Azerbaijan as of 1 January 2009 were estimated at 1.2 trillion cubic meters. Production in the second stage of the development of Shah Deniz field, which is regarded as the main source of filling the pipeline, is estimated at 20 billion cubic meters per year.
Nabucco Pipeline
According to Managing Director of Nabucco Gas Pipeline Int. Consortium Reinhard Mitchek, Azerbaijan is the original source for the project. "We see great potential in the Caspian region, and I am sure that the first gas for Nabucco will be from Azerbaijan," said Mitchek.
The Nabucco project worth 7.9 billion euro will deliver Azerbaijani and Central Asian gas to the EU. Nabucco shareholders are the Austrian OMV, Hungarian MOL, Bulgarian Bulgargaz, Romanian Transgaz, Turkish Botas and German RWE with 16.67 percent each. Construction of the pipeline is expected to begin in 2011 and the first supplies - in 2014. Its maximum capacity will be 31 billion cubic meters per year. An investment solution on the project will be made in the first quarter of 2010. The Nabucco Gas Pipeline International will invest 30 percent of the project on basis of its share. The remaining 70 percent will be provided by international institutions.
ITGI project
ITGI (Turkey-Greece-Italy) Pipeline Project is under a final investment decision and is awaiting the consent of Azerbaijan to sell gas from the second stage of the development of Shah Deniz, Ellio Ruggeri, head of ITGI project, director on business development of the Italian company Edison SPA, recently said in Baku. He said the final investment decision on the ITGI project will be made after Azerbaijan expresses willingness to sell gas from the Stage 2 of Shah Deniz.
ITGI transport corridor which will transport Azerbaijani gas to Greece and Italy includes updated Turkish pipeline infrastructure and also ITG projects (Turkey-Greece junction pipeline) and IGI. Greece-Italy junction pipeline is a missing link of Turkey-Greece-Italy transport corridor which enables to transport gas from the Caspian region and Middle East to Italy and West Europe via Turkey and Greece. The designed carrying capacity of ITGI is 12bln cu m per year.
The total cost of ITGI pipeline is estimated at 120 million euros. Pipeline construction is scheduled to be completed by 2012. The design capacity of the ITGI pipeline is 8 billion cubic meters of gas per year. The operator of the ITGI pipeline project is the consortium of Edisson (Italy) and DEPA (Greece) companies.
TAP
Trans Adriatic Pipeline, also aimed at supplying Caspian gas to Europe with a length of 520 km, envisages supplying gas to South-East Italy via Greece and Albania. The pipeline includes a 115-kilometer underwater section from Albania to Italy. Estimated cost of the pipeline project will amount to $2.2 billion. The pipeline is scheduled to be put into operation in 2011. The initial capacity of the pipeline is 10 billion cubic meters of gas per year. It is planned to increase its capacity to 20 billion cubic meters.
White Stream
"Azerbaijan has enough gas for the first phase of the project [White Stream]. In total, the project expects to receive up to 16 billion cubic meters of Azerbaijani gas, said the director of UK-based White Stream Pipeline Company, Roberto Pirani.
The White Stream project envisages pumping gas from Azerbaijan's Shah Deniz field via Georgia through the Black Sea to Ukraine and the EU. At the first stage, the initial pipeline capacity is expected at the level of 8 billion cubic meters of gas annually. Later, the White Stream can be connected to the Trans-Caspian gas pipeline. In this case, the second line of the pipeline will be laid on the seabed and the capacity will increase to 24-32 billion cubic meters of gas per year. The first deliveries of gas through the White Stream pipeline will begin in 2016.
Competition in Asia and Russia
It is noteworthy that the periods of implementation of all projects are almost same. And all would be nothing if Europe would be the only contender for the Azerbaijani gas. Each time, the number of those willing to buy it increases. In the same row with Georgia and Turkey there are now Iran, Russia and even China.
And according to senior representatives of SOCAR (State Oil Company of Azerbaijan), although the European direction remains a priority for Azerbaijan, Europe must hurry up with the purchase of Azerbaijani gas. If Europe delays in this regard, then all the gas from Azerbaijan may irrevocably escape to Asia.
China
Kazakhstan suggested Azerbaijan to participate in the project of gas transportation to China through Kazakhstan-China pipeline, of which construction started in July this year, and completion and start of gas supplies via it is scheduled for June 2010. Initial capacity of the pipeline will be 4.5 billion cubic meters per year. The maximum volume of gas supply will amount to 40 billion cubic meters per year by the end of 2013.
Iran
Iran also plans to purchase Azerbaijani gas in volume of five billion cubic meters annually. And although Azerbaijan denies plans to deliver such gas volumes to the Islamic Republic, the director of dispatch center of the National Iranian Gas Company (NIGC), Hassan Muntazar Turbati, said the desire of his country to increase gas operations in Azerbaijan, depending on the opportunities of the two countries and the capacity of the existing pipeline. Turbati also mentioned their plans to start importing Azerbaijani gas from the second stage of the development of Shah Deniz.
Russia
SOCAR and Russia's Gazprom plan to sign an agreement in October on delivery of Azerbaijani gas to Russia. According to a senior representative of SOCAR, in 2010 the company will supply to Russia 500 million cubic meters of its own gas, but in 2011, if necessary, the volumes will be increased.
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