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Europe southern gas corridor pipeline race heats up
January 24, 2012 / 5:41 PM / 6 years ago

Europe southern gas corridor pipeline race heats up

* TAP group says “happy to work with TANAP”

* ITGI group says “fully compliant” with TANAP

By Henning Gloystein

LONDON, Jan 24 (Reuters) - Competition to build Europe’s southern gas corridor intensified on Tuesday after two leading pipeline projects said they would welcome cooperation with the Trans Anatolian gas pipeline (TANAP) which aims to pump Azeri gas through Turkey.

Three international consortia - Nabucco, TAP, and ITGI - are vying to build the infrastructure to carry gas from Azerbaijan’s Shah Deniz II gas field to Europe.

The TAP and ITGI gas pipeline projects both welcomed cooperation with TANAP, potentially providing the missing link in transporting the Azeri gas through Turkey and into Europe.

“TAP will be happy to work with the developers of TANAP for any required coordination between the two pipelines, thus providing a fully integrated solution for the delivery of Caspian gas to Europe,” TAP’s External Affairs Director Michael Hoffmann told Reuters on Tuesday.

“For TAP it is important to have the Turkish transit piece concluded, and ... TANAP is an ideal transportation solution within Turkey for the delivery of Caspian gas to the western border of Turkey with Europe,” he added.

The TANAP pipeline would run from Azerbaijan to the Turkish border with Bulgaria, and its initial capacity would be 16 billion cubic metres (bcm) a year, with 6 bcm set aside for Turkey and 10 bcm for the rest of Europe, although the project is designed to be expandable to 30 bcm and ultimately 60 bcm.

TAP would carry 10 bcm of Caspian gas a year along a 800-km route, starting at Komotini near the Greek-Turkish border, going through Greece and Albania, and ending near San Foca in Italy.

TAP’s partners are Norway’s Statoil, Swiss EGL , and Germany’s E.ON Ruhrgas, and Statoil is also a partner in Shah Deniz II, alongside BP.

Also on Tuesday, the ITGI group issued a statement in which it said its project was linkable with TANAP.

“The ITGI project starting at the Turkish-Greek border is fully compliant with any option to transit Azeri gas through Turkey, including TANAP,” Elio Ruggeri, CEO of IGI Poseidon, the project’s operator, said.

ITGI plans to transport 10 bcm a year of gas from the Turkish/Greek border to Italy, and its main partners are Italy’s Edison, Greece’s government controlled DEPA, and Turkey’s Botas.

TANAP, THE MISSING LINK

The offers come a week after Germany’s RWE, a major partner in Nabucco, said the TANAP “option ... needs to be explored.”

While RWE said it would hold on to its existing pipeline plans, it also said it was open to new cooperations.

The $5 billion TANAP pipeline would effectively duplicate Nabucco in Turkey, and some form of cooperation between Nabucco and TANAP could bring cost reductions, give TANAP the desired western European partners, while building a network under European regulations, something many western European companies and the EU want.

“Turkey is only an observer of the European community. That means it does not have to implement EU energy law,” Marlene Holzner, a spokeswoman for the European Commission said.

“However, we as the EU commission, hope that for any pipeline, there will be created an international government agreement between all member states which reflects certain principles,” she added.

All pipeline projects in the region fall into the southern gas corridor, a project promoted by the European Union to diversify its gas supplies away from Russia through finding new sources in central Asia.

Because deals with Iraq, Turkmenistan and Iran are not likely in the near future, the focus is currently on pumping Azerbaijan’s gas from its Shah Deniz II field into Europe.

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