July 3, 2009 / 10:02 AM / in 10 years

UPDATE 4-Nabucco gas intergovernment deal to be signed July 13

* Nabucco transit accord to be signed July 13

* Romania says Turkish throughput issue solved

* Agreement to boost competition with rival Russian pipeline

(Adds comment from Russian Energy Minister)

By Zerin Elci and Radu Marinas

ANKARA/BUCHAREST, July 3 (Reuters) - An intergovernmental transit agreement for the Nabucco natural gas pipeline will be signed in Ankara on July 13, the European Union said on Friday, confirming statements from Romania and Turkish sources.

The pipeline, intended to relieve European dependence on Russian gas, is expected to bring Caspian and Middle East gas to Europe as early as 2014, but the project has been delayed by lack of supplies and infighting among stakeholders.

A firm transit agreement could increase competition between Nabucco and a rival Russian pipeline, allowing the EU-backed project to start work on open-season agreements, when firms buy up portions of the pipeline’s 31 billion cubic metre capacity.

“On July 13, the intergovernmental accord on Nabucco will be signed in Turkey,” Romanian Economy Minister Adriean Videanu told Reuters by telephone from Azerbaijan where he is on a two-day visit.

The European Union confirmed it had received an invitation to the July 13 signing ceremony.

“I can confirm that the Commission has received an invitation to the signing ceremony of the intergovernmental agreement on the Nabucco pipeline on July 13 in Ankara,” a European Commission spokesman told a news briefing.

Jose Manuel Barroso, President of the European Commission said the Nabucco project was crucial for Europe’s energy security.

“15 PERCENT ISSUE”

The signing of the transit agreement was delayed by demands from Turkey, which has few hydrocarbon resources of its own, that it uses 15 percent of Nabucco’s 31 billion cubic metre capacity throughput for its domestic usage or for re-export.

Videanu said Turkey’s “15 percent issue” was now solved, but gave no details. The EU executive did not comment on whether the issue had been resolved.

Representatives from Turkey, Bulgaria, Romania, Hungary and Austria, the five countries through which the pipeline is planned to run, will sign the accord. Germany is the sixth Nabucco consortium member, but has no transit role.

Rival Russian project South Stream pulled ahead of Nabucco in securing more supplies this week when Azerbaijan promised Gazprom priority in buying gas from the second phase of the major Shakh Deniz project.

The $11 billion Nabucco has had difficulty in finding throughput for the line, though consortium members have planned on using gas from Iraq, Egypt, Azerbaijan and possibly Russia and Turkmenistan.

Iran can participate in the European Union-backed pipeline if Washington normalises relations with Tehran, the U.S. Secretary of State’s Special Envoy for Eurasian Energy has said.

Russian Energy Minister Sergei Shmatko told reporters on Friday: “We have a clear understanding that Turkey doesn’t perceive Nabucco as an alternative to South Stream. We made a proposal to Turkey to take part in South Stream implementation.”

He added Turkey could side with Russia in other projects.

For facts on Nabucco pipeline project click on [ID:nLH629489] (Additional reporting by Vladimir Soldatkin in Moscow and Anne Jolis in Brussels; writing by Thomas Grove; editing by James Jukwey)

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