BAKU, Azerbaijan, July 5
By Leman Zeynalova – Trend:
Azerbaijan is the second contributor to export-driven gas production growth in Eurasia, with the ramping up of capacity to fill the TANAP and TAP pipelines to Europe, Trend reports with reference to the International Energy Agency’s Gas Market Report Q3.
“Eurasia has taken the brunt of 2020’s gas market adjustment, with a double impact on domestic and export sales that led to a close to 60 bcm decline in annual production compared to 2019 – about half of the world’s total supply adjustment. The region’s natural gas output is set to expand by 17% between 2020 and 2024, largely driven by Russia, which accounts for over 85 percent of Eurasia’s growth. Russia’s gas production is set to expand by 18%, mainly driven by the ramp-up of new and recent export projects (the Power of Siberia pipeline, the Yamal and Arctic LNG 2 plants) and the recovery of exports to Europe. Azerbaijan is the second contributor to export-driven production growth, with the ramping up of capacity to fill the TANAP and TAP pipelines to Europe. Turkmenistan leads the growth in Central Asia, while development potential appears more limited for Kazakhstan, and even more so for Uzbekistan where gas production is facing severe upstream issues that lead to an expected end to gas exports by 2025 (it stopped exporting to Russia in mid-2020).
Global natural gas production dropped by an estimated 2.9% y-o-y or 120 bcm in 2020, a larger impact than in the aftermath of the 2008 financial crisis (when gas supply declined by 100 bcm in 2009). Demand recovery in 2021 and further growth in emerging markets in the coming years are accompanied by gas supply expansion, as output grows by 9% between 2020 and 2024 in this forecast. It is worth mentioning, however, that this additional output comes at a slower rate than before 2020 and is almost exclusively from projects already under development.
The Southern Gas Corridor, which is comprised of Shah Deniz 2, the South Caucasus Pipeline Expansion, the Trans Anatolian Natural Gas Pipeline (TANAP), and the Trans Adriatic Pipeline (TAP) became fully operational on December 31, 2020.
Trans Adriatic Pipeline (TAP) AG confirmed on Dec. 31, 2020 the commencement of gas flows from Azerbaijan. The first gas has reached Greece and Bulgaria, via the Nea Mesimvria interconnection point with DESFA, as well as Italy, via the Melendugno interconnection point with SNAM Rete Gas (SRG).
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