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Turkey, Azerbaijan agree on purchase and sale agreement

Oil&Gas Materials 30 April 2011 12:08 (UTC +04:00)
The Turkish Energy and Natural Resources Minister said on Friday that Turkey and Azerbaijan agreed on purchase and sale part of the intergovernmental agreement, adding that, however, the parties needed time to work more on transit passages part of the agreement, the Turkish Anadolu news agency reported.
Turkey, Azerbaijan agree on purchase and sale agreement

Azerbaijan, Baku, April 30 / Trend E.Ismayilov /

The Turkish Energy and Natural Resources Minister said on Friday that Turkey and Azerbaijan agreed on purchase and sale part of the intergovernmental agreement, adding that, however, the parties needed time to work more on transit passages part of the agreement, the Turkish Anadolu news agency reported.

Speaking at a news conference regarding the Turkey-Azerbaijan Natural Gas Purchase, Sale and Transit Agreement, Energy and Natural Resources Minister Taner Yildiz said the parties carried out the negotiation process on five topics, underlining that they could not agree on every issue.

Yildiz said the teams would maintain talks and noted that a series of agreements would be signed.

He said there would be a transportation agreement regarding intergovernmental agreement, purchase and sale agreement and transit passage of gas, and noted that some agreements were initialed and some of them were about to be initialed.

"We have agreed on the intergovernmental agreement in principle and in detail. We agreed on issues regarding purchase and sale agreements. Transit passage is a 130 page text. We need time to work on it."

Azerbaijani Energy Minister Natig Aliyev said there was no difference of opinion, noting that the parties would negotiate the matters and sign them.

The document stipulates the purchase of oil from Azerbaijan's Shah Deniz in the first stage of the field's development at new price, as well as the purchase under the Shah Deniz-2.

Under the current Azerbaijan-Turkey contract, Turkey must receive 6.6 billion cubic meters of gas from Shah Deniz in the first stage of the field's development.
Shah Deniz reserves are estimated at 1.2 trillion cubic meters.

The contract to develop the offshore Shah Deniz field was signed on June 4, 1996. Participants to the agreement are: BP (operator) - 25.5 percent, Statoil Hydro - 25.5 percent, NICO - 10 percent, Total - 10 percent, LukAgip - 10 percent, TPAO - 9 percent, SOCAR-10 percent.

In turn, the transit agreement will allow Azerbaijan to sell its gas directly to Europe via Turkey. Azerbaijan is considering several projects on gas supplies to Europe under the Southern Gas Corridor.

Azerbaijani President Ilham Aliev and European Commission President Jose Manuel Barroso signed the Joint Declaration on the Southern Gas Corridor in Baku in January.

The 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).

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