Azerbaijani gas to be in demand…with or without Europe

Azerbaijani gas to be in demand…with or without Europe
22:07 22 Dekabr 2015
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Baku, Azerbaijan, Dec. 22

By Maksim Tsurkov – Trend:

Azerbaijan was and remains the sole alternative gas supply source for Europe. However, it seems that not everyone understands this in Europe.

It is Azerbaijan, not the EU, which offers a solution to the problem of energy security of Europe – and this is a fact, no matter how paradox it sounds.

The Azerbaijan-initiated Southern Gas Corridor, including one of its parts – the Trans-Adriatic Pipeline (TAP), is the major such solution. By the way, the TAP is meant to annually deliver 10 billion cubic meters of Azerbaijani gas to Europe from the offshore deposit Shah Deniz through Georgia, Albania and Italy.

However, given the difficulties faced by the TAP project in Europe, questions arise: does Azerbaijan need all of this? Is it necessary to take certain unconditional financial, political and other risks only to provide a number of European countries with “warm” winter and a feeling of energy safety in the face of Russian hegemony?

Perhaps, certain circles in Europe think that it is necessary for Azerbaijan to sell its gas to Europe, so it can set some terms, put forward some requirements to get benefits. However, these assumptions become worthless amid the facts. Azerbaijan does not greatly need the EU to derive profit from gas supply.

The sides agreed to accelerate the construction of another important segment of the "Southern Gas Corridor" - Trans-Anatolian gas pipeline (TANAP) during Turkish Prime Minister Ahmet Davutoglu’s recent visit to Baku.

This occurred amid great deterioration in the relations between Turkey and Russia, which is a major supplier of gas to this country today.

Turkey bought 27.3 b c m of gas from Gazprom in 2014. If suddenly Russia stops supplying gas to Ankara, it should look for an alternative.

“Turkey has alternatives, primarily, gas from Azerbaijan,” Davutoglu said. “A decision was taken to accelerate the construction of the TANAP gas pipeline.”

It was presumed that the Azerbaijani gas will be delivered to Turkey in mid-2018. However, given that the other work on Shah Deniz 2 project has also been accelerated in Azerbaijan, the country can receive this gas even earlier.

At the initial stage, TANAP’s capacity will be 16 billion cubic meters of gas of which 6 billion cubic meters will be supplied to Turkey, while 10 billion cubic meters will be delivered to Europe.

Nevertheless, if Turkey needs large volumes of gas and Europe continues to put obstacles instead of constructing the TAP, Azerbaijan can easily supply the whole volume to Ankara. One shouldn’t forget that TANAP will have technical potential to expand its capacity to 32 billion cubic meters per year.

The European Union shouldn’t forget that Azerbaijan has already signed contracts with a number of European companies, including Gas Natural Fenosa, DEPA, E.ON, Engie, HERA Trading, EGL-Axpo, Enel, Shell and BULGARGAZ on the Shah Deniz gas. If these companies breach the contracts, they will face several millions of dollars of fines and penalties.

Azerbaijani gas will be in demand with and without Europe.

Edited by SI


Maksim Tsurkov is Trend Agency’s staff journalist, follow him on Twitter: @MaksimTsurkov

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