Azerbaijan, Baku, Nov. 23 /Trend A.Badalova/
The Albanian Economy, Trade and Energy Ministry and the Trans Adriatic Pipeline AG (TAP) commenced the negotiation of a Host Government (Permit) Agreement (HGA), setting out the specific requirements to be followed throughout the project's implementation, TAP reported on Wednesday.
The Agreement will define the terms and conditions under which the development, construction and operation of the pipeline will be secured through a legally binding framework.
The Trans Adriatic Pipeline will transport gas from the Caspian region via Greece and Albania and across the Adriatic Sea to southern Italy and further into Western Europe. The project is aimed at enhancing security of supply as well as diversification of gas supplies for the European markets. The total length of the pipeline is about 800 kilometers.
The initial pipeline capacity will be 10 billion cubic meters per year. TAP's shareholders are EGL of Switzerland (42.5%), Norway's Statoil (42.5%) and E.ON Ruhrgas of Germany (15%).
According to the report, the Albanian Commission for negotiations and TAP representatives held their initial meeting at the offices of the Ministry of Economy, Trade and Energy in Tirana.
TAP's implementation process of the gas value chain, including pre-construction activities as well as construction and operational requirements in Albania was discussed during the meeting.
The parties endeavour to conclude the negotiations in compliance with the overall time table governed by the Shah Deniz Stage II project in Azerbaijan, the report said.
Gas, which will be produced within the second stage of Azerbaijani Shah Deniz field development, is considered as the main source for TAP project.
On Oct. 1, TAP along with the other pipeline projects (Nabucco, ITGI) submitted their final proposals to the Azerbaijani side, which review them in accordance with previously announced criteria.
According to the Managing Director of Trans Adriatic Pipeline AG, Kjetil Tungland, TAP will make a significant contribution to the Albanian economy, both in terms of investment and the development of its energy infrastructure and supply.
"We look forward to progressing our talks and concluding an agreement," Tungland said.
According to the report, the start of negotiations for a Host Government Agreement is the latest in a number of positive developments for TAP in Albania in 2011.
In July, a Memorandum of Understanding and Cooperation was signed with the Albanian government to explore the possibility of connecting a major regional natural gas project, the Ionian Adriatic Pipeline, to TAP at a tie-in point in Albania.
In September, Third Party Access Exemption (TPA) applications were submitted in Albania, as well as Greece and Italy, allowing TAP to enter into long-term ship-or-pay Gas Transportation Agreements with the shippers of Shah Deniz II gas.
This summer, TAP also conducted a detailed Environmental and Social Impact Assessment in Albania that included liaison with national and regional authorities and a series of community meetings in towns and villages along the pipeline route.