LONDON, March 22 The consortium developing
Azerbaijan's giant Shah Deniz II gas field, Europe's best hope
of diversifying supplies away from Russia, is finding less
interest for its gas from buyers across the continent, BP
said on Friday.
BP's Vice President of Shah Deniz Development, Al Cook, said
the project has seen a 25 percent reduction in demand expressed
by European buyers since 2010 for future deliveries of Azeri gas
once it starts flowing through pipelines across Turkey to Europe
But despite the drop in interest, demand still far outstrips
the 10 billion cubic metres per annum (Bcma) that Azerbaijan has
earmarked for customers in Europe, Cook said.
"Two years ago demand for Azeri gas was 40 Bcma (billion
cubic metres per annum), today it's 30 Bcma," BP's Vice
President of Shah Deniz Development Al Cook said.
Two groups are currently competing to pipe Azerbaijan's
Caspian Sea gas into western European markets.
The Shah Deniz consortium, which comprises BP, Statoil
, state-run Azeri firm SOCAR and Total among
others, will decide by end-June whether to pipe gas into Austria
through the proposed Nabucco West pipeline or into Italy through
the rival Trans-Adriatic Pipeline (TAP) project, Cook said.
Decreasing demand for Azeri gas in Europe is due to
companies making more realistic estimates of their future gas
demand compared with a few years ago, Cook said, denying that it
was the result of economic slowdown weighing on energy demand.
"At the end of last year we nervously awaited the results of
buying interest, but the desire for Azeri gas in Greece and
southern Europe has not been dimmed (by the economic crisis),"
BP expects first gas from Shah Deniz II to be delivered to
Turkey in 2018 with early 2019 set for the first Azeri gas to
reach western Europe in a major development that will reduce
European dependence on Russia for its energy supplies.
The European Union, which depends on Russia for about a
quarter of its gas needs, wants to diminish that share by
bankrolling new import corridors from the Caspian Sea via
Azerbaijan and Turkey.
Output from Shah Deniz II is expected to reach 16 Bcma of