3 more sources for Southern Gas Corridor; which has more chances?

Oil&Gas Materials 28 March 2019 09:00 (UTC +04:00)

Baku, Azerbaijan, March 28

By Leman Zeynalova – Trend:

Turkmenistan, Kazakhstan and Iran are the three main possible additional sources for the future expansion of the Southern Gas Corridor, Ariel Cohen, senior fellow, Energy Center, The Atlantic Council, and principal at the International Market Analysis LTD told Trend.

Talking about the prospects for each of the above countries’ joining the Southern Gas Corridor, the expert focused on the Trans Caspian Pipeline project.

"For a long time, I was a great supporter of the Trans Caspian Pipeline, however, unfortunately, the current arrangement in the Caspian Sea does not yet allow for the laying of the pipe on the bottom of the sea and therefore, I don’t see how the current arrangement will allow a working project. But if Ashgabat and Baku come to an agreement and if Russia and Iran do not interfere, there may be a great project, because the length of the pipeline is not very long and also because Turkmenistan has an abundance of gas. Turkmenistan has the fourth largest reserves in the whole world," said Cohen.

He went on to add that the situation with Kazakhstan and Iran is more difficult, because Iran does not have large enough reserves in the north and Kazakhstan currently uses gas for injection and for domestic consumption and also exports to China through the Central Asia-China Gas Pipeline.

"If Kazakhstan finds more gas and is willing to spend money, if Kazakhstan finds investors to participate in the Trans Caspian Gas Pipeline, then definitely there can be more gas going to that pipeline," added Cohen.

The expert pointed out that Europe currently requires more gas, because it is going to phase out its coal power stations and eventually nuclear power stations, and will therefor need to find new sources of energy.

"Renewable penetration is not yet sufficient to provide Europe’s base load power, meaning when there is no sun and no wind, you need dependable conventional power to generate electricity, and natural gas is a very good source. Given geopolitical and economic conditions I would say that this gas demand will most likely be met by Turkmenistan followed by Kazakhstan. Iran will only be a contender once it manages to exploit its gas in the north of the country and international sanctions are removed. Clearly for now, Iran under economic restrictions is not a supplier of gas and by the way, politically both Europe and the US will be supportive of such a project," he added.


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