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Nabucco project’s original concept limits chances to be implemented

Oil&Gas Materials 31 May 2012 15:42 (UTC +04:00)

Azerbaijan, Baku, May 31 / Trend A.Badalova /

Nabucco gas pipeline project has very limited chances to be implemented in its original concept unless the State Oil Company of Azerbaijan (SOCAR) has a stake in it, Julian Lee, energy analyst at the Centre for Global Energy Studies (CGES), believes.

"I do not think there is any realistic chance for Nabucco in its original format. The only way would be for a majority stake to be transferred to SOCAR and I do not see that happening," Lee wrote Trend via e-mail.

Nabucco project, which is designed to transport gas from the Caspian region and Middle East to the European countries, has been recently prejudiced by the statement of BP official representative that the original concept of the project is no longer considered as a possible export route for Azerbaijani gas.

However, later, SOCAR's high-ranking official said that "Nabucco Classic" is still an option to transport Azerbaijani gas to the European markets taking into account that the proposed alternative Trans Anatolian (TANAP) pipeline through Turkey is so far just a concept.

Lee, however, believes the choice has to be between South East Europe Pipeline (SEEP) and Nabucco West, which envisages the construction of the pipeline from the Turkish-Bulgarian border to the Austrian Baumgarten.

"SOCAR has illustrated in both the oil and gas sectors that it wants to be involved in the transit and sale of Azerbaijan's oil and gas to end users. It has no interest in selling at the Azerbaijani border and allowing others to transport and sell to end-users," he said.

Therefore, according to Lee, the decision may come down to which project SOCAR has a stake in.

"At the moment, it has no stake in Nabucco West, so I believe SEEP may be chosen, even though we still seem to be short on details of what it actually entails and whether it could be expanded to carry future volumes of Azerbaijani gas to Europe, Lee said. Unless SOCAR obtains a stake in Nabucco West, in which case things could change."

Nabucco project's original concept limits chances to be implemented

Proposed by BP, SEEP envisages gas transportation through existing or expanded infrastructure of Turkey to the Balkan Peninsula, and then the distribution of 10 billion cubic meters from the second stage of Azerbaijani Shah Deniz field development to small buyers, including Greece, Bulgaria, Serbia, Croatia and others via the existing gas pipelines system.

The choice between the projects aimed at transporting gas to Central European direction will be made in June.

The final decision on a pipeline route to export Azerbaijani gas to the European markets is expected to be made by Shah Deniz consortium in 2013.

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