Turkish Forum

Tag: Azerbaijani gas

  • Azerbaijan, Turkey to Sign Delayed Tanap Pipe Deal End of June

    Azerbaijan, Turkey to Sign Delayed Tanap Pipe Deal End of June

    Azerbaijan and Turkey plan to complete delayed talks on the proposed Trans-Anatolia pipeline that will carry Azeri natural gas across Turkey to Europe by the end of the month.

    TANAP

    “We aim to complete talks this month and sign the inter- governmental agreement by June 30,” Elshad Nasirov, vice president of State Oil Co. of Azerbaijan, known as Socar, said today in an interview in the capital of Baku. The deal was held up issues over tax and the investment regime, according to Nasirov.

    The two sides signed a memorandum of understanding in December on the 2,000-kilometer (1,240-mile) pipeline known as Tanap that will transport gas from the BP Plc-led Shah Deniz field in Azerbaijan’s section of the Caspian Sea. Socar has an 80 percent stake, while Turkey’s state pipeline company Boru Hatlari Ile Petrol Tasima AS, or Botas, and oil company Turkiye Petrolleri AO have a combined 20 percent.

    At an estimated cost of $5 billion to $7 billion, the partners plan to build Tanap before the start of production from the second phase of the Shah Deniz project, due in 2017 or 2018. It will link up with other proposed pipelines, such as Nabucco West, that are vying for the rights to deliver the fuel on to the European Union from the Turkish border.

    Size of Stakes

    The delay in agreeing a deal wasn’t caused by disagreements over the size of stakes in the project, according to Nasirov. The Azeri news agency Turan cited unidentified Turkish officials in March as saying that Turkey wanted to boost its stake in Tanap to as much as 50 percent.

    “We have not received any proposal from the Turkish side on this,” Nasirov said today.

    Tanap will initially be able to carry 16 billion cubic meters of gas a year, with capacity rising to more than 30 billion cubic meters as and when additional sources are found, Nasirov said.

    The Shah Deniz group will choose between Nabucco West, a revised version of the EU-backed project, and BP’s South East Europe Pipeline option, or SEEP, “no later than June 30,” he said.

    While Nabucco is a “fantastic” project even though it has financial difficulties, SEEP is less advanced, according to Nasirov.

    The winner of the Central European route will then compete with the Trans-Adriatic Pipeline, or TAP, that’s being developed by EGL AG, Statoil ASA (STL) and EON Ruhrgas AG. The Shah Deniz partners will make a final decision by mid-2013, he said.

    Azerbaijan can supply 10 billion cubic meters of gas to Europe for at least 25 years, the executive said.

    To contact the reporter on this story: Zulfugar Agayev in Baku at zagayev@bloomberg.net

    To contact the editor responsible for this story: Hellmuth Tromm at htromm@bloomberg.net

    via Azerbaijan, Turkey to Sign Delayed Tanap Pipe Deal End of June – Businessweek.

  • Turkey to ship 10bn cubic metres of Azerbaijani gas

    Turkey to ship 10bn cubic metres of Azerbaijani gas

    Turkey to ship 10bn cubic metres of Azerbaijani gas

    A senior SOCAR official has briefly outlined agreements between Azerbaijan and Turkey on the purchase, sale and transit of gas.

    Elshad Nasirov, vice-president of state oil company SOCAR, said that under one agreement signed last week Turkey will purchase 6.6bn cubic metres of gas from Azerbaijan per annum, while under a framework agreement on gas transit 10bn cubic metres of Azerbaijani gas will be transported to Europe via Turkey, APA reported.

    “The transit agreement with Turkey signed on 25 October in Izmir envisages the reconstruction and expansion of the existing gas infrastructure,” Nasirov said. He confirmed that the consortium to export gas to Europe, produced as part of stage two of development of Azerbaijan’s Shah Deniz field, would be selected by the end of the year.

    The Nabucco, ITGI and TAP pipeline consortiums have all bid to export Azerbaijan’s gas, while Shah Deniz operator BP has come up with a fourth export option, should none of the three be suitable.

    Elshad Nasirov said, meanwhile, that a new consortium would be created to construct a planned pipeline from the Georgian border to Turkey’s western border.

    “Membership of the consortium will depend on the choice of the government of Azerbaijan and the desire of the companies participating in the Shah Deniz project, while one of the Turkish companies will be nominated by the Turkish government,” Nasirov said.

    He said the choice of route across Turkey for the new pipeline would depend on commercial considerations.

    “In order to transport Azeri gas to Europe we must select the best route. We’re not talking only about Shah Deniz, but also about gas extracted from other deposits in Azerbaijan,” APA reported Nasirov as saying.

    “In the final analysis, the option that brings the greatest economic benefit will be chosen.”

    Shah Deniz costs

    The final investment decision on the second stage of development of the Shah Deniz gas condensate field will be made in 2013, Elshad Nasirov said.

    He confirmed that the first gas from Shah Deniz II would be produced in 2017.

    Meanwhile, BP-Azerbaijan’s chief financial officer, Ian Sutherland, said that BP had increased the cost of developing Shah Deniz, ABC/Fineko reported.

    He told a conference in Baku on Wednesday on “The State Oil Fund’s Role in the National Oil Strategy of Azerbaijan” that $23bn was needed to take gas production in Azerbaijan to 26bn cubic metres per year.

    Earlier cost estimates for Shah Deniz II did not exceed $22bn.

    As part of Shah Deniz II, 16bn cu.m of gas are to be produced per annum. As part of Shah Deniz I, 10bn cu.m are to be produced, although this figure has not been achieved yet.

    Elshad Nasirov reminded journalists today that at present Azerbaijan exports 6.6bn cu.m of gas to Turkey, 1.5bn to Georgia, 400m to Iran and 750m to Greece. Azerbaijan exports gas to Russia too.

    The Shah Deniz consortium consists of BP (operator, 25.5%) StatoilHydro (25.5%), SOCAR (10%), LUKOIL (10%), NICO (10%), Total (10%), and TPAO (9%).

    www.news.az

    via Turkey to ship 10bn cubic metres of Azerbaijani gas : Center for Economic and Social Development (CESD).