Azerbaijan, Baku, Aug.26 / Trend, E. Ismayilov /
Azerbaijan and Turkey successfully continue negotiations on a gas agreements package, including an agreement on transit of Azerbaijani gas to Europe, the Turkish Ambassador to Azerbaijan Hulusi Kilic said on Friday.
Negotiations are planned to be completed in September, he said.
The transit agreement envisages the sale of Azerbaijani gas directly to Europe through Turkey.
The main source for Azerbaijani gas supply to Europe via Turkey will be the second stage of the "Shah Deniz" field development, with first gas productions expected in 2017. Some 10 billion cubic meters of gas can be exported to Europe per year.
A transit agreement must be concluded with Turkey in order to transport Azerbaijani gas, particularly from the Shah Deniz field to Europe. SOCAR is currently negotiating with potential buyers and transporters of Azerbaijani gas. However, the contracts, as well as permissions for the launch of the second stage of Shah Deniz development, can be expected only after signing a transit agreement with Turkey.
As SOCAR Foreign Investments Department Head Vagif Aliyev said earlier, the two sides concluded negotiations on most of the contract's details, including transit fees, gas volumes, and transportation options. However, disagreements on legal issues still hamper the signing of the agreement.
Aliyev said the volume of investment in the Shah-Deniz-2 project, which given the construction of pipelines can reach $25 - $30 billion, should be safeguarded. One way to obtain such a guarantee is a solid legal framework that would protect the interests of all parties.
Shah Deniz reserves are estimated at 1.2 trillion cubic meters of gas.
The contract to develop the offshore Shah Deniz field was signed on June 4, 1996.
Participants to the agreement include BP (operator) - 25.5 percent, Statoil - 25.5 percent, NICO - 10 percent, Total - 10 percent, LukAgip - 10 percent, TPAO - 9 percent, SOCAR-10 percent.
Under the Azerbaijan-Turkey contract, Turkey should annually receive 6.6 billion cubic meters of gas from Shah Deniz. The volume will be 6 billion cubic meters under the Shah-Deniz-2 project.