Shah Deniz 2 awaits TANAP FID for project commencement
The Shah Deniz 2 consortium is awaiting the partnership heading the Trans Anatolian Natural Gas Pipeline project to make their FID prior to making their own, with the FID required to trigger the execution of plans to develop Azerbaijani gas fields, according to a high level BP executive, Hurriyet Daily News reported.
The TANAP oil pipeline will be carrying gas from Azerbaijan through Georgia and Turkey to European markets the year. Talking yesterday at the Atlantic Council summit in Istanbul, Al Cook, the Vice President of Shah Deniz Development, emphasized the importance for TANAP's key shareholders, Turkey and Azerbaijan, to finalize their decision on investment plans in order for the FID required for the Shah Deniz 2 project to be made.Yet the reverse is also true for TANAP, according to energy experts, who said TANAP is also waiting for the Shah Deniz 2 consortium to make its final investment decision in order for the project to receive the green light.
"Shah Deniz 2 needs to make the FID before the end of the year because they can no longer delay it," John Roberts, an energy security specialist, told the Daily News. Al Cook expressed confidence that the Shah Deniz 2's final investment decision will be made before the end of the year, although admitting that "there will be few very busy weeks ahead."
TANAP foresees to carry 31 bcm of gas annually while the initial Azeri gas to be produced is expected to be 16 bcm. Al Cook asserted his confidence in the additional production of gas while talking about new gas fields in Azerbaijan, likening them to a "main course"; in contrast, the initial 16 bcm of gas that is expected to flow from TANAP could serve as an appetizer rather, using the metaphor of a meal to distinguish between the two.
"TANAP links the largest source of gas to the largest gas market which is Europe and this underpins our confidence," he said. Al Cook called on the governments within the scope of the projects to continue extending their support. "In the last five years period we learned that the support of governments was essential," he said, calling first on Turkey and Azerbaijan's continued support, given their role as key players in the projects. Cook also mentioned the U.S. Government's support, which began back in the early 90's, enabling the construction of the Baku-Tbilisi-Ceyhan oil pipeline, the region's first. Cook also said they would like to see "the considerable role" played by the European Commission to continue. The European Commission's support for the diversification of supply routes should not only be limited to massive pipeline projects like TANAP but also to smaller ones that will be constructed, connecting Balkan countries.
Azerbaijani gas is planned to be carried to Turkish border via TANAP and then to Greece, Albania and Italy through the Trans Adriatic Pipeline (TAP). The Greek company DEPA is already continuing work to expand its connection with Bulgaria, with plans to build further smaller pipelines that will connect with pipeline networks in Romania, Hungary and Serbia, according to Harry Sachinis the CEO of DEPA.