Southern Gas Corridor project - culmination is soon

The rapidly moving events around Nabucco West project and the Trans-Adriatic Pipeline (TAP) in recent days are related to the fact that very few time is left to think. The consortium for the development of Azerbaijani 'Shah Deniz' gas condensate field started assessing the final proposals from TAP and Nabucco West projects. Until late June this year it is planned to make a final decision on the most advantageous option for transporting gas to Europe.

This is the culmination of "Southern Gas Corridor", which, by the way, has been delayed several times. That indicates how difficult sometimes is making a choice. But the choice is inevitable - the beginning of the second stage of development of Azerbaijani 'Shah Deniz' gas condensate field requires quick determination of the route of Azerbaijani gas deliveres to the European market.

Once again, the Consortium on "Shah-Deniz" voiced the main route selection criteria: it is, first of all, the price of gas on the market (for long-term customers), and then - a transit fare. But these criteria, quite understandable from an economic point of view, existed from the beginning. The difficulty is in the fact that each of the two available options has its own advantages.

Today, each of the two competing projects - Nabucco West and TAP - has the advantages allowing the final decision to be made in its favor. Both sides approached to the set goal with full responsibility by presenting to the consortium convincing arguments on the demand for gas, technical, administrative, supervisory, financial and other aspects. Both projects enjoy equal political support of the involved parties, have the same perspective which equalizes their chances of success

Azerbaijan is a winner, regardless of the chosen route. The U.S. takes a neutral stance on the issue of transporting Azerbaijani gas via TAP and Nabucco West. The European Commission does not show preference for any project, because the goal of both routes within a single project of the "Southern Gas Corridor" is aimed at diversifying the energy sources to the EU.

The process of choosing the project affects the interests of individual European countries that feel the need for additional sources of gas. Thus, while choosing Nabucco West project, a decisive feature is to provide South-Eastern Europe with gas. This region is the most dependent on a single supplier in terms of energy and therefore the most vulnerable.

As for TAP project, a critical factor is the support for the Greek and, in part, the Italian economy. The investments are expected to be made to the Greek economy and new jobs will be created while constructing and further exploiting the pipeline. These countries (perhaps, excluding Italy) actually need Azerbaijani gas. They must achieve the pipeline to pass through their territory, or, in extreme cases, near. As one can see, random choosing one of the projects is unacceptable. More significant reasons are required to tip the scales in favor of one of the above-mentioned projects.

How can one eliminate this difficult selection process? If the parties do not have a significant argument in the near future that will give preference to one of the projects, the only variant in this situation (which may be a pleasant surprise for the participants of this unique contest) is to choose both routes. Moreover, such a variant for the long term prospect has not been excluded. It will be possible to transport gas via the pipelines not only from "Shah Deniz" field, but also significant volumes of gas from other Azerbaijani fields and even gas from other countries.

According to the forecasts, the global energy demand will grow day by day and the proven gas reserves in Azerbaijan make up more than 2.2 trillion cubic meters. This enables Azerbaijan to become a major supplier of gas to the international markets for the next few decades.


/Trend/