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Expert: Turkey - main winner in battle for Nabucco and South Stream

Oil&Gas Materials 22 December 2010 19:49 (UTC +04:00)

Azerbaijan, Baku, Dec. 22 /Trend, E.Tariverdiyeva/

Turkey is a country economically very interested in buying gas from Iran, Iraq and the Caspian countries, said Alexander Rahr, a German political scientist and expert on energy policy, the author of "Russia offers gas" book.

"Turkey wants to become a major distributor of Russian and Central Asian gas to Europe, and in this context it is the main winner in the battle for the Nabucco and South Stream," Rahr, the director of the German Council on Foreign Relations' Russia-Eurasia Center, told Trend by telephone from Berlin.
Nabucco gas pipeline project worth € 7.9 billion will transport gas from the Caspian region and the Middle East to the EU. Construction of gas pipeline is planned to be launched in 2012, the first deliveries are scheduled for 2015. Maximal capacity of the pipeline will hit 31 billion cubic meters per year. Project participants are the Austrian OMV, Hungarian MOL, Bulgarian Bulgargaz, Romanian Transgaz, Turkish Botas and German RWE. Each participant has an equal share of 16.67 percent. 

The main suppliers of gas for the project are considered Azerbaijan, Iraq and Turkmenistan.

South Stream gas pipeline was designed to transport Russian natural gas to Europe via the bottom of the Black Sea and then via Bulgaria, Serbia and Hungary. The project is realized by Italy's ENI and Gazprom, which signed an agreement to build an offshore gas pipeline on June 23, 2007.

The 900 kilometers long offshore section of South Stream would start from the Beregovaya compressor station at the Russia's Black Sea coast, and would run to Bulgaria's Varna. Based on the plans, the pipeline will be commissioned by 2014. Its capacity should reach 63 billion cubic meters of gas a year. Total investment in the project is estimated at 25 billion euros.

According to Rahr, a member of the Trend Expert Council, the gas to Europe will in any case go through Turkey, making its position extremely advantageous.

"Turkey is the only country without which none of the gas pipelines from Central Asia to Europe will be constructed. Ankara does not want to be just a transit country for gas, as it is today. Using its excellent geopolitical situation, it is performing this map and will buy and sell gas," he said.

According to him, Turkey has a chance to transform from a transit state into a seller of gas - an important energy carrier. This will strengthen the country's role as a bridge between Asia and Europe in an enormous degree, the expert said.

"But the time will tell how the West will allow Turkey to acquire such status," he said. Perhaps, according to Rahr, one of Turkey's partners in the sale of gas will be Iran, which today has really nothing to do except cooperation with Turkey.
According to Rahr, today, the West refuses to cooperate with Iran in all fields, including energy field, and will continue to refuse while Iranian President Mahmoud Ahmadinejad continues to make statements similar to those of today.

However, in reality, it is very important for Iran to sell its gas, including to the West, since the Iranian economy mostly focuses on the sale of energy carriers, and it is unprofitable to refuse cooperation.
"Tehran must understand that the factor of gas has not yet played a critical role in Europe or the West. Neither Iran nor Russia nor any other countries can dictate conditions from Europe due to their natural gas reserves," said the expert.

Rahr said if Iran does not change in political plan, it will not be able to sell its gas to Europe.

"At least over the next two years, the gas in Europe will be in sufficient quantity, given the supply of liquefied gas and the possibility of developing shale gas, on which Europe is well able to agree, despite the current failure of this method because of environmental reasons," said the expert.

It also needs to understand that Europe simply does not need simultaneously the both pipelines -the South Stream and Nabucco, he said.

According to Rahr, Russia perseveres in its desire to build the South Stream, investing a lot of money. "But the question of Nabucco is still open, since on the one hand, companies are not really in a hurry to participate in this process, but on the other - the politicians in the EU so much support this project, which somehow can not believe that it will not be realized," he said.

Probably, Nabucco will be built upon a political will rather than the need, expert said. "The West is keen to build Nabucco to diversify flows beyond Russia, of which it is afraid," said Rahr.

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