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New gas pipeline across Turkey not to affect Nabucco – SOCAR CEO

November 05, 2011, 20:06 UTC+3
It is negotiating with Turkey to sell 6 billion cubic metres gas per year from Shah Deniz II, and 10 billion cubic metres to European customers
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BAKU, November 5 (Itar-Tass) —— The construction of a new gas pipeline in Turkey proposed by Baku and Ankara for the transportation of Azerbaijani natural gas will not affect the Nabucco project, State Oil Company of Azerbaijan Republic (SOCAR) CEO Rovnag Abdullayev said.

“We do not interfere in the Nabucco consortium’s plans. Our task is to deliver Azerbaijani gas to European markets through Turkey’s gas transportation system. This is a complex system and it is hard to supply gas to Europe by it. In order to simplify things, Azerbaijan and Turkey have considered the possibility of building a new gas pipeline from the eastern to the western border of Turkey,” he said on Saturday, November 5.

The two countries will draw up a feasibility study for the new pipeline. “Based on the feasibility study, we will decide whether the existing gas transportation system in Turkey should be used for the export of gas or we should build a new gas pipeline,” Abdullayev said.

The new pipeline may be built by 2017 when the second stage of the offshore Shakh Deniz field development begins in the Caspian. The field is believed to contain 1.2 trillion cubic metres of gas. The pipeline can transport 16 billion cubic metres of has a year: 6 billion cubic metres to Turkey and 10 billion cubic metres to Europe.

Azerbaijan has been negotiating with more than 20 companies and consortiums interested to buy gas from Shah Deniz II and has said it will conclude negotiations by the middle of next year.

It is negotiating with Turkey to sell 6 billion cubic metres gas per year from Shah Deniz II, and 10 billion cubic metres to European customers.

Abdullayev did not rule out that the estimated reserves might increase after the second well has been drilled at the new filed. The state oil company is doing the exploration at the new field on its own, without engaging foreign investors and companies.

Speaking of Nabucco, Abdullayev said this is an ambitious project designed to transport 30 billion cubic metres of gas annually. “So far, the section of the pipeline from Bulgaria to Baumgarten, Austria, is finished. The Turkish stretch is not ready. This pipeline is intended not only for Azerbaijani gas but also for gas from Turkmenistan and Iraq,” he said.

European Commission President Jose Manuel Barroso and European Commissioner for Energy Guenther Oettinger travelled to Azerbaijan and Turkmenistan in January of this year to discuss prospects for filling the Nabucco pipeline with natural gas.

Azerbaijan will be able to transport hydrocarbons to promising new markets if the Nabucco gas pipeline is built, Turkish President Abdullah Gul said earlier after a meeting with Aliyev prior to Barroso's visit.

“The Baku-Tbilisi-Ceyhan gas pipeline is operating. It brings big benefits and income to Azerbaijan every year. If Nabucco is built through Turkey, Azerbaijani hydrocarbons will get access to promising markets,” the Turkish president said.

Azerbaijan's recoverable gas reserves exceed two trillion cubic metres. Azerbaijan's overall natural gas reserves are estimated at 3-5 trillion cubic metres. The country is a key potential gas supplier for the European-backed Nabucco pipeline project.

Now that certain difficulties have arisen in the talks with Turkmenistan, Azerbaijan and Iraq are being considered as the most probable gas suppliers for the pipeline.

Theoretically, either country can ensure continuous and uninterrupted gas supplies to keep the pipeline with the capacity of 31 billion cubic meters a year running at full capacity.

The 3,300-kilometre Nabucco pipeline is due to connect the European Union to gas deposits in Central Asia and the Middle East. It initially planned to start the construction of the line between Turkey, Bulgaria, Romania, Hungary, and Austria in 2011.

In early 2011, the European Union and Azerbaijan signed a declaration on the Southern Energy Corridor and set up a working group that has begun consultations.

“Azerbaijan supports the Southern [Energy] Corridor. We support all projects within this corridor, including the trans-Adriatic pipeline that involves Switzerland. I think this project has a good future,” Aliyev said.

He stressed that the declaration on the development of the Southern Energy Corridor signed with the European Union earlier this year “can become a very important practical step in the implementation of this project”.

The president expressed confidence that all questions related to the Southern Gas Corridor, including transit ones, would be resolved shortly.

The Southern Gas Corridor includes the Nabucco, Turkey-Greece-Italy and Trans-Adriatic gas pipelines. It is not clear as yet which one will be used for the transportation of Azerbaijani gas to Europe. Baku promises to solve this issue by the end of the year by considering offers made by the consortiums and choosing the best one.

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