Nabucco new concept may have better chance for success
Azerbaijan, Baku, March 1 / Trend A.Badalova/
New concept of Nabucco project envisaging a shorter route and a smaller capacity as compared to original pipeline version may have better chances for implementation, Julian Lee, energy analyst at London-based Centre for Global Energy Studies (CGES), believes.
"I think for the Nabucco partners the only way forward for their project was to propose a shorter alternative to transport gas from Turkey's western border to Austria," Lee wrote Trend in an e-mail.
As soon as Azerbaijan and Turkey announced the idea of building their own pipeline across Turkey, it became clear that the full Nabucco project was unlikely to be built, Lee believes.
Nabucco Gas Pipeline International proposed a new conception of the project (Nabucco-West) to the Shah Deniz consortium, according to which the pipeline will be laid from the Turkish-Bulgarian border to the Austrian Baumgarten. The project's original concept envisages the construction of the pipeline with the length at 3,900 kilometres from the Georgian-Turkish and Iraqi-Turkish borders to Baumgarten. The pipeline is expected to run through Turkey, Bulgaria, Romania, Hungary and Austria.
According to some sources, Nabucco pipeline's capacity (at 31 billion cubic metres) can be also downsized by twice.
The Azerbaijani-Turkish Trans-Anatolian natural gas pipeline (TANAP) envisages a construction of a pipeline with the initial capacity at 16 billion cubic metres per year from the eastern border of Turkey to the country's western border.
Lee believes that the biggest problem for Nabucco project was always that it had no gas producers as shareholders. He said while it was seen as having strategic significance for Europe, the companies operating there were unwilling to subsidize Europe's strategic plans in the absence of clear sources of supply to run the line at capacity.
"If Nabucco could have been built with a smaller capacity and then expanded as additional sources of supply were confirmed, it would have had a better chance of success," Lee said.
However, he believes that it is unclear now whether Nabucco-West proposal will be more successful.
According to Lee, it will have to compete with the BP proposal of SEEP (South Eastern European Pipeline), which will follow a very similar route, and the TAP (Trans Adriatic Pipeline) planned to run from Greece to Italy via Albania.
"As with the original Nabucco proposal, its current weakness may be a lack of gas producers sponsoring it. It is also unclear whether the third party access exemptions and priority status that Nabucco was granted by the EU will be transferable to Nabucco West," Lee said.
The current shareholders of Nabucco project, which is designed to transport gas from the Caspian region and Middle East to the European countries, are Bulgarian Energy Holding, Romanian Transgaz, Turkish Botas, Austrian OMV, German RWE and Hungary's FGSZ.
The construction of Nabucco pipeline with maximum capacity of 31 billion cubic meters is planned to start in 2013 and its first supplies are scheduled for 2017.