NO CHANCE FOR NABUCCO

The partners in the Shah Deniz [Sah Daniz] oilfield development recently selected the Trans-Adriatic Pipeline  (TAP) as the main corridor for the export of Azerbaijan's gas to Europe. This project won against the competing Nabucco West project. TAP is largely targeting markets in Greece and Italy and even Western Europe. Construction is to start on the pipeline in 2015, with the aim of supplying gas in 2019.

Twenty-five-year-long agreements are to be concluded with gas customers in Greece, Italy and Bulgaria in the very near future. A total of 10bn cu m of gas per year are to be supplied to the three countries. Tugce Varol Sevim, the head of the Turkish power engineering and energy security research centre, a lecturer in the political science and international relations department at Aydyn University in Istanbul, has agreed to share with Regionplus his vision of TAP's prospects and the part it is playing in ensuring Europe's energy security.

- What do you think about Azerbaijan's choice of the Trans-Adriatic Pipeline (TAP)?

It should first be noted that the TAP project would be shorter in length and lower in cost than the alternative Nabucco West project. These are  particularly important factors in implementing this project. The fact that TAP is being laid through Greece and Western Europe is another plus because countries with strong economies and a high demand for gas are concentrated on this territory. From the commercial, political and economic point of view TAP is an extremely advantageous project. Both the Nabucco and TAP projects require an additional pipeline linking them with Azerbaijan. On the other hand, in selecting TAP, Azerbaijan has shared Europe's gas markets with the Russian global energy company Gazprom in an extremely proper manner without causing any tension with Russia. TAP is not an alternative to the "Southern Gas Corridor", so this means that any political friction with Moscow has been avoided. The "Southern Gas Corridor", which is to go across the Black Sea bed, will be laid between Bulgaria and the countries of Eastern and Central Europe. The TAP and TANAP [Trans Anatolian Natural Gas Pipeline] are being laid to the states of Western Europe. The interests in these strategic projects on the part of Russia, on the one hand, and Azerbaijan and Turkey, on the other had, are not at odds. This is very advantageous to Azerbaijan, as well as Turkey, which is planning to purchase even more gas from Russia.

- Do you think that there is any chance that the Nabucco project will be realised?

- I personally have always believed that the Nabucco project, as well as Nabucco West, never had the slightest chance of being implemented. That project does not have any commercial or political prospects at all. Now my view has been upheld.

- Azerbaijan and Turkey have all the necessary resources to go ahead with the TANAP project. Nevertheless, is there any possibility that a third partner will join this project?

- In actual fact, two of the shareholders in the Shah Deniz project, Britain's BP and Norway's Statoil, which have a 42.5 per cent stake in the project, may be considered the third partner. Statoil will be involved in the extraction and transportation of the gas from Baku to Greek territory. These major oil companies may be considered a third partner in the export corridor for Caspian gas, alongside the Azeri and Turkish governments.

- Turkey is increasingly concentrating on its territory the export corridors for the supply of energy resources to Europe. Is this likely to have an impact on the decision to allow Turkey's membership of the European Union?

- Turkey is working hard in that direction. In particular, the government has drawn up an "energy file", in which it is noted that Europe should be able to depend on Turkey for its energy security. This is all quite possible, but in the next five to 10 years Turkey's main priority is to satisfy its own demand for gas. The gas supplied via the TANAP will allow Turkey to meet its own energy needs to a significant extent. Turkey's additional consumption is expected to reach 16bn cu m of gas per year. So, Turkey is currently tackling the problem of providing for its own energy security.

- How much energy does Turkey require at the moment?

- This year Turkey will need 42-46bn cu m of gas. Last year we purchased 3.9bn cu m from Azerbaijan. According to Turkey's contract with Azerbaijan, the former is committed to purchasing 6.6bn cu m of gas per year. Unfortunately, Turkey cannot import this volume for technical reasons, but this problem is being resolved.

Turkey is keen to buy Azeri gas, but it does not always depend on the wishes of the Turkish and Azeri governments. Our countries have to agree their energy policy with Western partners. For BP, Statoil and others the main priority is West European markets.