EU to negotiate trans-Caspian pipeline

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The European Union has agreed to negotiate a treaty with Azerbaijan and Turkmenistan to bring natural gas from the world's fourth-largest reserves across the Caspian Sea to Europe, the bloc's executive said today (12 September).

The European Commission will lead negotiations on behalf of the whole 27-nation bloc on the proposed pipeline, which is part of a planned corridor of links known as the Southern Corridor, designed to reduce EU dependence on Russian gas imports.

"Europe is now speaking with one voice, The trans-Caspian pipeline is a major project in the Southern Corridor to bring new sources of gas to Europe. We have the intention of achieving this as soon as possible," EU energy chief Günter Oettinger said in a statement.

A series of projects have been competing to carry gas to Western Europe as alternatives to supplies from dominant producer Russia. They gathered momentum after a row between Russia and transit nation Ukraine led to the cut off of supplies to western Europe in 2009.

The European Commission has thrown its weight behind the Nabucco pipeline, which would carry gas through Turkey, Bulgaria, Romania and Hungary into Austria and Western Europe.

Analysts say the pipeline has the advantage of political backing, but could struggle to find enough gas for its planned 31 billion cubic metres (bcm) capacity.

It is among three pipelines bidding for contracts for 10 bcm of Azeri gas per year from the second phase of Shah Deniz in Azerbaijan. The deadline for the three bidders to submit their case is 1 October.

Analysts had been saying there was no other gas available in the near term, which meant the size of the Nabucco project – the most ambitious of the three schemes – could be a problem.

Turkmenistan is the holder of the world's fourth-largest natural gas reserves and with ambitious plans to expand. A trans Caspian pipeline between Turkmenistan and Azerbaijan could provide a route for Turkmen gas to link up with the Nabucco scheme.

"On the mandate for Turkmenistan and Azerbaijan, it is crucial because those countries are vital if we were to develop the southern corridor for gas and oil delivery," Polish European Affairs Minister Mikolaj Dowgielewicz told a news conference in Brussels.

"We are not talking about just those two countries but we are talking about potentially new important partners for the European Union in terms of supplies of raw materials, so that's why it's also significant."

EURACTIV with Reuters

Günter Oettinger, the EU's energy commissioner on 7 September unveiled proposals aimed at strengthening the EU's voice on energy matters vis-à-vis foreign countries such as Russia.

The so-called 'Communication on Security of Energy Supply' and international cooperation sets out for the first time a comprehensive strategy for the EU's external relations in energy.

It remains unclear if the policy proposals, which are non-binding, will ever become law, but Oettinger said he hoped EU countries would back them.

The strategy lists 43 concrete actions, among which putting in place a rule that energy agreements with third countries could also be negotiated at EU level where necessary to achieve the EU's core objectives.

The construction of a gas pipeline across the water from Turkmenistan to Azerbaijan is not possible for the time being due to disputes over the delimitation of territorial waters in the Caspian Sea, Araz Azimov, deputy foreign minister of Azerbaijan, told EURACTIV last year.

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