Status of pipeline projects within Southern Energy Corridor for December 2010

Azerbaijan, Baku, Dec. 17 / Trend A.Badalova /

Southern Corridor is a priority EU energy project diversifying energy supply routes and sources and increasing EU energy security. The Southern Corridor includes: the Nabucco gas pipeline, Trans Adriatic Pipeline (TAP), White Stream, and ITGI (Turkey-Greece-Italy pipeline).


Nabucco gas pipeline project worth € 7.9 billion will transport gas from the Caspian region and the Middle East to the EU. 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.

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.

The main gas suppliers in the first phase of the project are considered Azerbaijan and Iraq from which the volume of gas is expected in 8-10 and 8 billion cubic meters respectively. Subsequently, the Turkmen gas is planned to be connected to the project.

Construction of the Nabucco pipeline will be implemented in two main phases. The first phase of construction (2011) includes laying a new pipeline length of 2,000 kilometers, starting at the Turkish border and ending in Austria's Baumgarten. The second phase (2014-2015 year) includes the construction of the remainder of the pipeline on the border between Turkey and Georgia, as well as Turkey and Iraq.

Project status

Construction of gas pipeline is planned to be launched in 2012, the first supplies - in 2015.

A final investment decision on the project is expected to be made in 2011.

The process of open season is also expected to be conducted next year, which envisages to sell the carrying capacity of the Nabucco pipeline. During the procedure, the shareholders of the project will receive up to 15 billion cubic meters of gas per year (50 percent of the total transport capacity of the pipeline), the remaining 50 percent will be offered to third parties on an equal conditions on the principles of transparency.

In April 2010, the consortium announced the pre-qualification tender for the supply of durable goods (pipes, valves) for gas pipeline construction.
In the same month the consortium announced a tender for conducting an expanded basic and detailed engineering for the Turkish section of the Nabucco pipeline.

In August, at the steering committee meeting in Ankara, the project participants agreed to modify the concept of gas supply lines, as a result of which, two lines of fuel supply to the pipeline (from the Turkish-Georgian and the Turkish-Iraqi borders) were approved, and also given instructions for the appropriate engineering works .

In September, the international financial institutions began the process of determining the cost of the project, which is a necessary step to provide a financing package of up to four billion euros. The potential funding package of the project will consist of sums - up to two billion euros from the European Investment Bank, 1.2 billion euros from the European Bank for Reconstruction and Development (up to 600 million from the EBRD and 600 million will be syndicated with commercial banks) and up to 800 million euros from the International Finance Corporation (up to 400 million from IFC and up to 400 million will be syndicated with commercial banks).

Commitments for loans are expected to be available in 2011.


The Trans Adriatic Pipeline (TAP) designed in 2003 by the Swiss EGL Group envisages transporting gas from the Caspian region and Middle East to the European market.

The pipeline will begin in Greece, pass through the territory of Albania and the Adriatic Sea onward to Italy. The pipeline includes a 115-kilometer underwater section from Albania to Italy. Estimated cost of the construction of the pipeline is $1.5 billion. Initial pipeline capacity will be 10 billion cubic meters per year, maximum - 20 billion. The length of the pipeline is 520 kilometers.

Shareholders of the project are the Swiss EGL Company (42.5 percent), Norway's Statoil (42.5 percent) and Germany's E. ON Ruhrgas (15 percent).

Status of project

Construction of the pipeline is scheduled to begin in 2013. Starting the first deliveries of gas through the pipeline is associated with starting gas production within the full development of the Azerbaijani Shah Deniz (Shah-Deniz 2) field, scheduled for early 2017.

In March 2010, the company managing TAP project appealed to the Ministry of Economic Development of Italy for connecting the future pipeline with the national gas network in the country. The pipeline will connect with the Italian gas network through the 15-kilometer onshore pipeline section from Brindisi to Mesane.

In May 2010 the German E. ON Ruhrgas became the third shareholder in the project, acquiring 15 percent share.


The ITGI Transport Corridor designed to transport the Azerbaijani gas to Greece and Italy includes an updated Turkish pipeline infrastructure, as well as projects ITG (connecting pipeline Turkey-Greece) and IGI.

IGI Poseidon SA was established by Italy's Edison Company and Greece's Depa Company for the design and construction of the Greece-Italy pipeline known as Poseidon.

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. Capacity of the planned undersea pipeline Poseidon is 8-10 billion cubic meters of gas a year. The pipeline with a length of 212 kilometers will stretch through the bottom of the Adriatic Sea from the Greek Stavrolimenasa to Italian Otranto.

The planned capacity of ITGI pipeline is 11.8 billion cubic meters a year.

Greece intends to receive 3.6 billion cubic meters, and the rest - Italy. ITGI pipeline will run from Azerbaijan through Georgia (existing pipeline Baku-Tbilisi-Erzurum), and Turkey to Greece and later to Italy. The pipeline will be commissioned in 2015.

The main source of supply for the project is Azerbaijan, particularly the gas to be produced from the Shah Deniz field.

Status of project

In July 2010, IGI Poseidon SA Company reached an agreement with the Greek DESFA SA on cooperation over ITGI. The agreement defines the operational measures to ensure proper coordination of the detailed engineering of the sections of the ITGI pipeline.

The ITGI project may enter the operational phase by 2015.

White Stream

The White Stream project involves transporting the Azerbaijani gas across the Black Sea from the Georgian Port of Supsa to the Romanian Port of Constanta and onward to other EU countries.
Initial capacity of the White Stream pipeline will be 8 billion cubic meters per year, which will later be increased to 16 and then to 32 billion.  
The initial gas volumes for White Stream project is expected from Azerbaijan. But after the pipeline capacity increase, other sources of gas may be used.

Implementation of the project consists of several stages, the first of which envisages the construction of an underwater pipeline from Georgia to Romania, which will be built via the Black Sea.
The total length of the pipeline will be 1,100 km via the sea. The pipeline will pass at a depth of 200 meters.

Status of project

The consortium plans to build a new pipeline from the Sangachal Terminal near Baku to the Georgian Port of Supsa, which primarily will run parallel to the existing South Caucasus Pipeline (SCP). If the transport capacity of the SCP is extended enough (now it totals 20 billion cubic meters), White Stream could initially be supplied from this pipeline.

In 2011, the consortium plans to conduct a study of the offshore part of the pipeline route and environmental impact assessment (EIA).

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