GECF membership beneficial to Azerbaijan

Oil&Gas Materials 23 November 2015 20:46 (UTC +04:00)
Not only an observer status at the Gas Exporting Countries Forum (GECF), but also becoming its full member is beneficial to Azerbaijan.
GECF membership beneficial to Azerbaijan

Baku, Azerbaijan, Nov. 23

By Aygun Badalova - Trend:

Not only an observer status at the Gas Exporting Countries Forum (GECF), but also becoming its full member is beneficial to Azerbaijan, Stanislav Pritchin, the research assistant of the Center for the Study of Central Asia and Caucasus of the Institute of Oriental Studies (Moscow), said.

"Azerbaijan's consent of obtaining an observer status at the GECF is a positive signal," he said.

This is important given the situation on the European market - one of the world's largest gas consumers," Pritchin told Trend Nov. 23.

He explained that the EU strategy of establishing an energy union (a single energy market) creates a disadvantageous situation for suppliers where relations with the EU are based on terms. The EU itself is not responsible for multi-billion dollar investments in the gas extraction and transportation projects.

"In fact, this is a serious problem as the risks connected to the implementation of these projects are the supplier countries' responsibility," he said.

"And so, it would be a very positive fact for all the players if at least some general advisory approach is worked out in relation to the EU, in order not to create excessive competition in the European market," said Pritchin.

On Nov. 23, Tehran hosted the 3rd Summit of the GECF, which brings together the countries leading globally in terms of natural gas exports.

The GECF is made up of 18 main and observer members. Iran, Russia, Qatar, Algeria, Bolivia, Egypt, Equatorial Guinea, Libya, Nigeria, Trinidad and Tobago, Venezuela, Peru and the UAE are the main GECF members.
The Netherlands, Kazakhstan, Iraq, Norway and Oman take part in the forum's summit as observer members.
Azerbaijan is also becoming a new observer in the forum.

GECF is very often called "gas OPEC" by an analogy to the Organization of the Petroleum Exporting Countries.

Pritchin further said the GECF is advisory in nature and is not a full gas cartel.

"GECF only works out common approaches, which are not mandatory," noted Pritchin.

In this regard, he said, a full membership of Azerbaijan in the GECF won't affect the country's independent decisions.

Speaking about the prospects for GECF's transformation into an analogue of OPEC, Pritchin noted that the gas market is more complex than the oil market is, and requires more long-term solutions and investments.

"It requires a more responsible approach both on the part of consumers and on the part of producers/suppliers," he said.

The GECF was established in 2001 in Tehran and is a venue for a number of world's gas exporting countries to exchange information about concerned topics.

The GECF counts for 42 percent of the world's gas production, owns 67 percent of the world's gas reserves, conducts 38 percent of global gas transfers, and 85 percent of the global LNG trade.