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Romania to seek compensation from EU for Nabucco’s failure

August 28, 2013, 20:47 UTC+3

The overall cost of the Nabucco pipeline was estimated at about eight billion U.S. dollars

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BUCHAREST, August 28 (Itar-Tass) - Romania will demand that the European Union reimburse it for its contribution to the abortive Nabucco project, President Traian Basescu said.

The overall cost of the Nabucco pipeline was estimated at about eight billion U.S. dollars. The Romanian company Transgaz invested about 23 million euros in the project and sustained other related expenses.

Basescu said Romania had never hesitated in choosing between South Stream and Nabucco and had always supported the latter in the interests of the EU.

He regretted that “the crucial geopolitical gas pipeline project, Nabucco, will not be implemented.”

In late July, the decision was made to transport natural gas from Azerbaijan’s Shakh Deniz offshore field in the Caspian Sea to Europe by the Trans-Adriatic Pipeline bypassing Romania.

Nabucco was supposed to run from the Turkish-Bulgarian border to the vicinity of the gas hub at Baumgarten near Vienna, Austria, passing through Bulgaria, Romania and Hungary before it reached Austria. The total length of the pipeline was to be 1,300 kilometres.

Nabucco was supported by an Intergovernmental Agreement signed in July 2009 and ratified in all five transit countries. This treaty, valid for 50 years, granted transit rights in Austria, Hungary, Romania, Bulgaria and Turkey.

The Nabucco legal framework - the Intergovernmental Agreement, the Project Support Agreements and the Gas Law Exemptions - supported a pipeline project reaching up to the eastern and southern land borders of Turkey and with a design capacity of up to 31 billion cubic metres per year based on a 56 inch pipeline diameter.

However, to achieve economic transport conditions, the pipeline design had to be based on the actual demand for transportation services. To offer economical transport conditions in such circumstances, Nabucco was preparing an alternative technical design to the maximum technical configuration. This alternative design was based on a pipeline diameter of 48 inch and a pipeline from the Turkish-Bulgarian border to Austria to allow for a scalable transport between 10 and 23 billion cubic metres per year. Nabucco gave this alternative design the name “Nabucco West

Nabucco Gas Pipeline International CEO Reinhard Mitschek said earlier that if Nabucco West was chosen as the main route for delivering Azerbaijani gas to Europe, its construction would start in 2015 and the first gas supplies would begin in 2018-2019.

The Trans-Adriatic Pipeline will start in Greece, cross Albania and the Adriatic Sea and come ashore in southern Italy, allowing gas to flow directly from the Caspian region to European markets.

Trans-Adriatic Pipeline (TAP) AG is a joint venture company established with the purpose of planning, developing and building the TAP natural gas pipeline.

The Trans-Adriatic Pipeline will bring natural gas from the Caspian region to Europe.

The shareholder structure of the Trans-Adriatic Pipeline project comprises of Swiss Axpo (42.5 percent), Norwegian Statoil (42.5 percent) and German E.ON (15 percent).

The Shah Deniz Consortium has said repeatedly that it would choose the option that is most beneficial from the commercial and technical points of view.

The route will be used for transporting Azerbaijani natural gas produced under Stage 2 Shah Deniz development project. The first gas from Shah Deniz-2 will start to be produced in 2018 in the amount of 16 billion cubic metres a year, of which 10 billion cubic metres will be supplied to European markets.

The Shah Deniz field is believed to contain 1.2 trillion cubic metres of gas, while Azerbaijan’s overall proven gas reserves are estimated at 2.6 trillion cubic metres.


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