Richard Morningstar: Nabucco is good, but not only project
Azerbaijan, Baku, Dec. 9 / Trend A.Badalova /
U.S. Secretary of State Special Envoy for Eurasian Energy, Ambassador Richard Morningstar said the Nabucco pipeline project is "a good, but not the only project."
"We support not only Nabucco, but also the entire South Energy Corridor - a series of pipelines that will be required to deliver Caucasian and Central Asian gas to Europe via Turkey," he said in an interview with the Kommersant newspaper.
The Southern Corridor is a priority energy project for the EU aimed at increasing energy security, and includes projects such as White Stream, Nabucco, ITGI and the Trans-Adriatic Pipeline.
Morningstar said EU companies must make a commercial decision about which project is the most reasonable and beneficial.
"We would have preferred Nabucco, but that does not mean it will be implemented first," he said.
Nabucco is worth €7.9 billion. Participants are the Austrian OMV, Hungarian MOL, Bulgarian Bulgargaz, Romanian Transgaz, Turkish Botas and German RWE. Each participant has an equal 16.67 percent share. Construction is planned to launch in 2011, with first supplies beginning in 2014. The pipeline's maximum capacity will hit 31 billion cubic meters per year. The Nabucco Gas Pipeline International will invest 30 percent of the project cost. The remaining 70 percent will be paid owing to loans.
Shareholders of the South Corridor project consider Azerbaijani gas to be the basis for filling their gas pipelines during the first stage of implementation. In particular, hopes are set on gas produced during the full-scale development of the Shah Deniz gas condensate field.
He added that the consortium developing Shah Deniz will soon make a decision about the direction of its gas sales.
"This could be Nabucco, ITGI or another project," Morningstar said. "The main thing is to have the ability to expand the pipe."
"In any case, the first pipeline will not transport very large volumes of gas," he said. "However, it must have the potential for expansion if supply volumes increase. And this will surely happen. Therefore, the infrastructure should be prepared now."
Morningstar named Iraq and Turkmenistan as other gas sources for these projects. Iranian gas, he said, should not be included in any international projects until issues relating to Iran's nuclear program have been resolved and its relations with the United States and other countries are fully normalized.
According to BP, Azerbaijan's proven gas reserves were 1.31 trillion cubic meters as of Jan. 1, with Turkmenistan's at 8.1 trillion, Iraq's at 3.17 trillion and Iran's at 29.61 trillion cubic meters.