Turkey’s gas trading hub dream realistic: Oxford Study

Reuters

Turkey’s vision of becoming a gas trading hub is realistic given its diversity of supply but it would need to speed up market reform and invest more in gas infrastructure, an Oxford University study said on Feb. 10.

Turkey has long wanted to have a major power and gas market, capitalizing on growing domestic demand for gas and its proximity to cheap natural gas resources.

It has few natural resources of its own, but is at the centre of nearly all gas pipelines that would link Central Asia to Europe, defining the regional market for decades to come.

Turkey’s rise to prominence in energy markets would also add to its growing influence as a major economic and political player between Central Asia, the Middle East and the European Union, to which Ankara aspires to be a member.

According to state pipeline company BOTAS, Turkish natural gas demand is forecast to grow to 81 billion cubic meters (bcm) a year by 2030 from the current 47 bcm/yr.

It could potentially trade up to 100 bcm of gas a year when large-scale investments in gas infrastructure have taken place, such as new liquefied natural (LNG) gas and storage facilities, said the paper by the Oxford Institute for Energy Studies.

EU Diplomats: "Failed Nabucco West plan still on EU priority list"

REUTERS

The Nabucco West pipeline, which lost a contest to ship Azeri gas to Europe, is still on a list of projects eligible for EU cash, implying the European Commission still believes it could be built, EU diplomats said.

The Commission, the EU executive, next month is expected to publish a final list of projects judged significant to more than one EU nation and entitled to accelerated planning approval as well as consideration for money from the EU budget.

Commission officials declined to disclose the content of the list before publication.

But the diplomats, speaking on condition of anonymity, said it included the Nabucco West scheme, led by OMV, as well as the Trans Atlantic Pipeline (TAP), which was selected to by the Shah Deniz gas consortium to carry gas to Europe.

TAP includes Norway's Statoil, BP, SOCAR, Fluyxs, Total, E.ON Ruhrgas of Germany and Swiss company.
Commission officials have repeatedly said Nabucco West is not dead and could one day be built if more Caspian gas becomes available.

Other schemes on the list of roughly 200 Projects of Common Interest include a Baltic energy grid, aimed at ending the isolation of Baltic states and curbing their reliance on Russia.

A feasibility study for a gas link from Cyprus to Crete and then Greece or Italy is also on the list.
Cyprus has high hopes of rapidly developing its gas reserves to revive its broken economy, but export routes are complicated by its long-standing rift with Turkey.

BP, SOCAR, Total and Fluxys join the TAP project

TAP

The Trans Adriatic Pipeline AG (TAP) today announced that BP, SOCAR and Total - members of the international consortium developing the giant Shah Deniz field in Azerbaijan - have exercised their option to join the Trans Adriatic Pipeline AG.

BP and SOCAR have each taken a 20% share while Total has acquired 10%.  In addition, Fluxys, a major gas transit operator in Europe, has opted to join TAP, taking a 16% stake in the project. TAP’s shareholders, Axpo of Switzerland, Statoil of Norway and E.ON of Germany also continue their support of the project.

TAP’s shareholding is now comprised of BP (20%), SOCAR (20%), Statoil (20%), Fluxys (16%), Total (10%), E.ON (9%) and Axpo (5%).

Kjetil Tungland, Managing Director for TAP said: “I would like to welcome the Shah Deniz shareholders and Fluxys to the TAP project. Our new shareholders will significantly enhance TAP’s strategic position in becoming an integral link between both their upstream and downstream businesses. This will further strengthen the integration of the entire Southern Gas Corridor value chain and support TAP’s delivery of the project on time and on budget. ”

TAP’s shareholders remain open to further strategic partners joining the project in the future.

TAP outgunned Nabucco for Azeri gas on most fronts

 Reuters

* TAP beat Nabucco on 7 of 8 criteria

* The reason was not high gas prices in Italy, Greece
* Government continues to support South Stream
* GALSI pipeline important for Italy

The Trans-Adriatic Pipeline (TAP) project outscored rival Nabucco West on virtually all fronts to win the race to carry Azeri gas into Europe, a junior minister at Italy's Industry ministry told Reuters.

Azerbaijan's state energy company SOCAR and its partners in the Shah Deniz II gas field, including BP and Statoil , said on Friday they had selected TAP.

The project, linking a Turkish pipeline to southern Italy via Greece and Albania, plans to deliver 10 billion cubic metres (bcm) of Azeri gas to Europe each year beginning in 2019.

BP said there was a "substantial" commercial difference between the two competing pipeline projects, including the cost of shipping the Azeri gas and gas prices in the respective markets.

The head of Austria's OMV, part of the rival Nabucco project, said last week the TAP project had been chosen because of high gas prices in Italy and Greece.

"It was not for high gas prices in Italy and Greece," Claudio De Vincenti said in an interview.

Russian gas pipeline could doom Europe's Nabucco plan

Reuters


* Europe, U.S. support for Nabucco weakened
* Azeri consortium expected to pick winner in June
* Gas due to flow to European Union from 2019

Europe's grand plan for a gas pipeline from the Caspian Sea that would make its eastern states less reliant on Russia may have been fatally undermined by Russia's even bigger project.

As Azerbaijan nears a decision on which pipeline to choose for its future exports, the Nabucco plan that was long the European Union favourite could lose out to the more modest Trans Adriatic Pipeline (TAP) across Greece to southern Italy.

In a complex equation based on politics as much as economics, TAP is in the ascendancy over the Nabucco pipeline to Austria in the face of Russia's $39 billion South Stream plan.

"The question is: 'Is Nabucco viable if South Stream is built?'" said Andrew Neff, Moscow-based principal energy analyst with research firm IHS.

The decision between TAP and Nabucco is expected in June from partners in the Shah Deniz consortium, led by gas field operator BP and Azeri state energy company Socar.

The European Union won't have a direct say in the choice, but its recent switch to "project neutrality" from support for Nabucco could make a big difference. It now says it would be happy with either pipeline or even both.

"There has been a dramatic shift," TAP's External Affairs Director Michael Hoffmann told Reuters.

Nabucco spokesman Christian Dolezal, however, said his project retained strong political support.

Azerbaijan crucial for Greece to escape economic crisis

Today's Zaman    Lamiya Adılgızı

Greece’s growing interest in the energy resources of Azerbaijan, an oil-booming country on the shores of the Caspian Sea, is down to the belief Azerbaijan’s natural gas could rescue the country from the economic crisis it has been going through if Azerbaijan agrees to export its natural gas through the Trans-Adriatic Pipeline project (TAP), rather than its competitor Nabucco West.

 

Both pipelines fully depend on the same source of gas, Shah Deniz II gas field in Azerbaijan, and will start at the western coast of Turkey and convey the Azeri gas transported via the Turkey-Azerbaijan initiated Trans-Anatolia Pipeline (TANAP) across Turkey to EU markets.

“Greece considers TAP as a good opportunity to recover from its economic crisis and become a strategic energy terminal in the region. In order to materialize its ambition, Athens will try hard to persuade Baku to export TANAP gas through TAP, rather than the Nabucco-West option,” Emre İşeri, energy and security analyst at the İstanbul-based Kadir Has University, said in an interview with Sunday’s Zaman.

Greek Prime Minister Antonis Samaras paid a visit to Azerbaijan this week on his way back from China, a month after Greek Foreign Minister Dimitris Avramopoulos made a trip to the capital city of Baku for official talks on enhancing cooperation with Baku. The visit by Samaras has attracted a great deal of attention as it is the second high-ranking trip by Greece in a month.

Being received by Azerbaijani President İlham Aliyev in Baku on May 20, both leaders had an opportunity to discuss boosting political, economic and cultural ties. The leaders’ tete-a-tete meeting, which reportedly mainly focused on important opportunities to further strengthen bilateral cooperation, especially in the field of energy, was described by Samara’s as “positive” while briefing Greek President Karolos Papoulias on May 21.

Nabucco West and TAP: Going head to head

Amanda Paul     Today's Zaman


At the end of June, the long-awaited decision regarding which pipeline will be selected to transport natural gas from Azerbaijan’s Shah Deniz II field across Turkey to the EU market will be made.
 

This decision will be followed by the final investment decision in late 2013. Production is expected to begin in 2018 at some 16 billion cubic meters (bcm) per year: 10 bcm for Europe and 6 bcm for Turkey.

Last year the field of runners was narrowed to two: Nabucco West and the Trans-Adriatic Pipeline (TAP). The available gas is only enough to fill one of them. Both projects not only have economic but also political implications.

Officials from both Nabucco West and TAP are currently engaged in major lobbying campaigns to promote their respective projects to the Shah Deniz partners, the Azerbaijani government and the developers of the proposed TANAP pipeline across Turkey that would feed into their projects. While the Shah Deniz II Consortium will present their opinion to Azerbaijan over which pipe should be chosen, Azerbaijan is not obliged to follow this advice.

Nabucco West has always been labeled a geostrategic project. It would ship gas from Turkey’s western border via Bulgaria, Romania and Hungary and into the Baumgarten hub in Austria and into Central and Eastern Europe where it is badly needed with many of the countries heavily, or in some cases fully dependent, on Russian gas.

TAP Countries Give Tripartite Support

Natural Gas Europe

The governments of Albania, Greece and Italy have created a special committee to coordinate support for the Trans-Adriatic Pipeline (TAP), one of two major contenders for the contract to convey gas from the Shah Deniz 2 field off Azerbaijan.

External Affairs Director for TAP, Michael Hoffmann, said the support was a major vote of confidence in his consortium, which is led by Norwegian major Statoil.

TAP is included in the so-called Southern Corridor, a planned network of pipelines meant to offer alternatives to Russian gas for Europe.

Albania, Greece and Italy are all transit countries for TAP. When the gas supplies arrive in Italy, they will then be transported on to a range of customer countries, according to the plan.

TAP is up against the ambitious Nabucco West pipeline, which is backed by other European countries. Also on Wednesday, the Nabucco website recorded a call by Austria, Bulgaria, Hungary and Romania to support his alternative in the Shah Deniz decision.

On Monday the New York Times reported that Hungarian prime minister Mark Orban had said that MOL, his contry's participant in Nabucco West, wanted to withdraw from the project.

A BP-led consortium operating Shah Deniz is due to decide on the successful candidate by June.

Source: http://www.naturalgaseurope.com/tap-countries-give-tripartite-support

Black Sea Region and Natural Gas Prospects

Natural Gas Europe

The recent international Black Sea Oil & Gas Forum held in Bulgaria highlighted culminations surrounding natural gas trade and investments in the region, which are gaining strong pace.

The president of the Bulgarian energy regulatory authority, Mrs. Evgenia Haritonova, pointed out that Bulgaria's immediate target is to increase the production of domestic natural gas while at the same time diversifying its import sources, based on the current pipeline projects, such as the Southern Corridor and the interconnectors with its neighbors - Greece, Serbia and Romania, which will be finalized within the next 18 months. Further she added that the Bulgarian government had already signed with an energy consortium comprised of the France's Total SA, Austrian OMV and Spanish Repsol to conduct research for gas in the Black Sea field of Khan Asparuh. Identical competitions with international companies will take place in due time for the offshore locations of Silistar, Sveta Marina and Teres.

Regarding shale gas, Haritonova stated that for the moment the energy Ministry is following the moratorium of the Parliament, and until it is lifted no research could be made.  It is interesting to note that Bulgaria's special advisor of the ministry of economy Petar Poptchev noted that Chevron was not so much interested in shale gas exploration, but in conventional gas.

$10-12 bn to be invested in TANAP project

Nearly $10-12 bn is expected to invest in TANAP project.

 

Nearly $10-12 bn is expected to invest in TANAP project, SOCAR President Rovnag Abdullayev said at the meeting with Energy Minister of Turkey Taner Yildiz, APA-Economics reports.

To him, at present time, works are conducted in direction of legal and financial issues of the project: ‘Physical works on TANAP project is expected to start in Q2, 2014’.

TANAP marks revolution in energy history of Azerbaijan and Turkey

Trend AZ

Trans-Anatolian pipeline project (TANAP) marks a revolution in the energy history of Azerbaijan and Turkey, as it will be implemented at the expense of funding and infrastructure of these two countries, the head of SOCAR Turkey Enerji, a board member of Petkim Petrochemical Holding Kenan Yavuz told Trend on Tuesday.

According to Yavuz, it is expected that first construction works within TANAP will start in 2014. And the first delivery of Azerbaijani gas to Turkey will begin already in 2017, he said.

According to the latest estimates, the cost of the TANAP project totals $ 10 billion, Yavuz said.

"At the moment we are negotiating with international companies such as BP, Statoil and Total on assignment of interest in TANAP," he said.

Nabucco and TAP gas pipelines could both be built one day -TAP

Reuters

Both of the projects vying to pipe Azeri gas to the European Union can be built but not yet, a senior official from one of them said on Wednesday.


Second pipeline could take another five-to-10 years
Decision on winning project expected by mid-2013



The governments of Albania, Greece and Italy on Wednesday signed an agreement, confirming their support for the Trans Adriatic Pipeline (TAP), one of two projects in competition to reduce EU dependence on Russian energy.

"There will be 10 billion cubic metres of gas available from Shah Deniz phase II. In that context, there can't be two large-scale pipelines built at the same time," TAP External Affairs Director Michael Hoffmann told Reuters.

"But we can have two pipelines in a sequential situation. It will only be a matter of time before more gas comes on stream from Azerbaijan, though this may possibly take another five to 10 years."

TAP is proposing a route through Albania and Greece into Italy, while the rival Nabucco West project would ship gas along a different path from Turkey's western border into a hub in Austria from whence it could be distributed.

Heavily indebted nation Greece is particularly in need of the kind of investment an energy pipeline would bring and Greek Prime Minister Antonis Samaras attended Wednesday's signing ceremony in Athens.