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Czech Republic considers hydrocarbon supply potential from Azerbaijan (Exclusive)

Oil&Gas Materials 13 June 2024 12:27 (UTC +04:00)
Lada Yevgrashina
Lada Yevgrashina
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BAKU, Azerbaijan, June 13. The Czech Republic sees Central and Eastern Europe (CEE) as benefiting from an increase in oil and gas supplies from Azerbaijan, Director for Energy Strategy and International Cooperation of the Czech Ministry of Industry and Trade Petr Binhack said, Trend reports.

"Our hope is that Azerbaijan's current proportion of the EU's oil and gas imports will grow. Currently, Azerbaijan contributes to the European Union's oil and gas imports; we anticipate that this proportion will rise. The general aim of the EU, and specifically the Czech Republic, is to phase out supplies of Russian oil and gas. And Azerbaijan's role in this process is important," Binhak emphasized.

To note, the Czech Republic is really oiling up their wheels as they make it into the top 5 buyers of Azerbaijani oil. On the flip side, as per the State Statistics Committee of Azerbaijan, during the first four months of 2024, the Czech Republic went all out and bought a whopping 424,663 tons of Azerbaijani oil, shelling out a cool $272 million.

"We have supplied the Kralupy and Vltavou refineries with two million tons of Azerbaijani oil for the past few years. We have proved we are serious about this, and now construction is underway for the extension of the capacity of the Transalpine Pipeline (TAL) which connects to the Ingolstadt–Kralupy–Litvínov (IKL) pipeline. This pipeline already brings almost two million tons of Azerbaijani oil to the Kralupy and Vltavou refineries. It accounts for approximately 25 percent of oil consumption in the Czech Republic. With the increased capacity of the TAL pipeline, we hope to eliminate the remaining 50 percent of our supplies, which currently come from the Russian Federation. This will be possible by diversifying our sources, in particular by connecting TAL with the Ingolstadt–Kralupy–Litvínov (IKL) pipeline (IKL)," Binhack said.

Speaking about gas, a representative of the Czech Ministry of Industry and Trade emphasized that the Czech Republic strongly supports EU discussions on strengthening domestic gas infrastructure, be it the route through the Western Balkans or liquefied natural gas (LNG) terminals in Northwest Europe.

"We certainly support projects to diversify gas sources and recognize the importance of alternative routes. We do not believe that investments in new gas infrastructure or improvements to existing infrastructure create risks of lock-in effects (the EU's green targets for switching from fossil to renewable fuels). Our ultimate goal is to replace Russian supplies. It is not about increasing gas consumption that will jeopardize our climate targets by 2030 or 2050. Currently, with stable or even slightly reduced gas consumption, the EU still needs new supplies to gradually replace Russian gas," Binhack noted.

According to him, the Czech Republic is watching the development of the Vertical Corridor and Solidarity Ring gas pipeline projects.

"We are not involved in them. Neighboring Slovakia is involved in them. We are certainly interested in such projects because we have strong ties with Slovakia. So in this respect, the more gas that comes into the region, the better for the Czech Republic," Binhack explained.

He added that the Czech Republic's gas consumption in 2023 has dropped to 7 bcm from the previous figure of 9.5 bcm per year.

"This reduction is due to the impact on the country from the COVID pandemic, with additional measures domestically to reduce gas demand and improve energy efficiency. We are actively seeking to diversify our energy supply," the representative of the Czech ministry emphasized.

Furthermore, he recalled that until 2022, the Czech Republic was almost 100 percent dependent on Russian gas supplies, but over the past few years, it has been able to change this situation, in particular, by increasing LNG imports from several Western European countries, the US, and other countries.

"It is in our interest to attract as many alternative suppliers as possible, and Azerbaijan certainly plays a significant role in this strategy. A lot will depend on infrastructure," Binhack added.

To note, in June, during his speech at the Baku Energy Forum, he mentioned that gas is expected to contribute to approximately 10 percent of the electricity generation in the Czech Republic by 2035.

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