Talks over Shah Deniz gas supply pick up momentum

Georgian President Mikhail Saakashvili, accompanied by a delegation including his energy minister, had separate talks with Prime Minister Recep Tayyip Erdogan, Energy Minister Hilmi Guler and officials from the state-owned Turkish Pipeline Company (BOTAS) in Istanbul.

The meeting between the Turkish and Georgian officials in Istanbul was continuing when the Turkish Daily News went into press yesterday. Speaking to Georgian reporters after talks with Erdogan, Saakashvili hinted that many technical issues may still remain unclear following talks with Turkish officials.

Saakashvili said his country would not depend on a single source for energy supplies and added that the Georgian prime minister would soon travel to Azerbaijan for talks over natural gas.

Georgia wants to meet the majority of its 2007 energy needs with gas from the Shah Deniz field via the Baku-Tbilisi-Erzurum (BTE) pipeline project, aimed at transporting natural gas from Azerbaijan's Caspian Sea gas fields.

The BTE route, which passes through the territories of Turkey, Azerbaijan and Georgia, is shorter than the Baku-Tbilisi-Ceyhan oil pipeline. The main objective of the pipeline is to transport and sell the natural gas produced in Azerbaijan to Europe. The project was established by a partnership of Turkey, Azerbaijan and Georgia.

But some problems have emerged with regard to the sharing of the natural gas between the partner countries. First of all, Azerbaijan cannot produce or supply the amount of natural gas that it originally committed itself too. Baku is unwilling to share its natural gas with the two partner countries, Turkey and Georgia, saying that it has growing needs due to winter conditions. Georgia says it also needs natural gas and is pushing for internal consumption of the Azerbaijani supply, rather than its transportation to Europe.

Turkey says that it has no natural gas problem for the time being, but that it wants to use some of the gas in case Russia again cuts the supply as it did last year, or neighboring Iran reduces gas exports to Turkey.

Officials here say the original purpose of the BTE pipeline has undergone changes, with disagreements among the partner countries over the sharing of the Azerbaijani natural gas, rather than its transport and sale to Europe; the original purpose of the project.

Turkey wants to act in line with its national interests over the gas dispute, meaning it would utilize the Azerbaijani natural gas via the BTE pipeline in emergency situations, especially if the other partners, Azerbaijan and Georgia, also exploit the pipeline.

Even if it has no additional natural gas demand, says Turkey, it should be able to utilize the pipeline in the same way as the other partner countries in the BTE project, since it too has the right to utilize it in the same way that Georgia and Azerbaijan do.

The BTE pipeline is not yet operational due to the existing disagreements between the parties involved in the project. Turkish Daily News