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30/07/2016

Oettinger talks up Tanap pipeline

Energy

Oettinger talks up Tanap pipeline

pipeline2_pic_isp_Hazlan_Ab.jpg

EU Energy Commissioner Günther Oettinger has signalled that Brussels may soon accept the proposed Trans-Anatolian Gas Pipeline (TANAP), despite its earlier support for the Nabucco pipeline.   

Speaking at the launch of a State Oil Company of Azerbaijan (SOCAR) representation office in Brussels, Oettinger said that the Commission currently believed that its criteria could only be met by the Anatolian section of the Nabucco pipeline.

“But the TANAP pipeline which SOCAR now promotes may also be able to satisfy the criteria of capacity requirements, dedicated infrastructure, transparency and scalability,” Oettinger told the assembled oil and gas executives.

“We are therefore eagerly waiting for the necessary agreements to be ratified by both Turkey and Azerbaijan,” he added.

The opening of a SOCAR office in Brussels is being seen as a turn towards Europe by the energy giant, which has cultivated ambiguity over the final destination of gas from its Shah Deniz field.

While SOCAR already has representation offices in Istanbul and London, it has yet to open a bureau in Moscow. Russia has bankrolled the rival South Stream pipeline through its state monopoly Gazprom.

The EU is instinctively more sympathetic to importing gas from outside Russia, for reasons of energy security and diversification of supplies. But uncertainty over Baku’s export intentions has clouded the picture.  

Murad Heydarov, an advisor to SOCAR President Rovnag Abdullayev, told EurActiv that the TANAP pipeline, which is expected to be completed in 2018, was an indication of SOCAR’s commitment to safe and uninterrupted transit infrastructure for its gas.

“By 2025, the overall volume of gas [from Shah Deniz] could be 40-50cbm annually and most of this gas would go to Europe,” he said.  

The Tanap project was “reliable, robust, safe, operationally excellent and scalable,” Heydarov added.

Despite the apparently growing warmth between Brussels and Baku, observers at the SOCAR launch noted some possible flies in the ointment.

Oettinger’s appearance at the podium was preceded by pointed criticism of the EU from the director of SOCAR’s Azerkimiya Business Unit, Mukhtar Babayev.

The energy commissioner's speech was delivered over an hour later than scheduled, after several of the Azerbaijani company’s speakers over-ran their time limits.

Background

Several pipeline projects are competing with one another to bring to life the southern gas corridor – a vague blueprint to supply Europe with gas from the Caspian and the Middle East.

Initially the EU’s flagship project was Nabucco, designed to supply to Europe from the Caucasus and the Middle East to a gas hub in Austria, via Turkey, Bulgaria and Romania.

construction of Nabucco was expecetd to start in 2013 and the first gas is expected to flow in 2017. As planned, the pipeline would carry 31 bcm/y of gas.

But now only three smaller pipeline projects appear to be in competition to bring the gas from the Turkish-EU border deeper into the European Union:

  • Nabucco West: via Bulgaria and Romania to Austria
  • South East Europe Pipeline (SEEP): via Bulgaria and Romania to Hungary
  • Trans-Adriatic Pipeline (TAP): via Greece to Italy

Further Reading