Turkish Energy Minister Taner Yildiz offered Nabucco West a morale boost in its fight for the job of carrying Azeri gas into Europe on April 8 as he credited the EU-backed project as the "more ambitious" one that will offer the greatest economic benefits.
In early April, BP Azerbaijan, operator of the Shah Deniz project, reported that the consortium developing the giant field in the Caspian Sea has begun evaluating the final offers from Nabucco Gas Pipeline International (NIC) and Trans Adriatic Pipeline (TAP) for transportation of gas from the second phase of Shah Deniz from the Turkish-Bulgarian border into Europe. A final decision is due in June.
The Trans-Anatolian gas pipeline project (TANAP) will undertake the initial leg of the journey between Azerbaijan and European markets across Turkey. "At present, we are engaged in determining the exact route through which the TANAP pipeline will pass," Yildiz said, according to Azernews.
The minister said that while choosing the final route that will collect the baton from TANAP, the economic benefits from transportation will be taken into account. "In this sense the Nabucco West project is more ambitious," he suggested. However, the Turkish minister noted that it is the Shah Deniz consortium that will choose the final route.
That's no minor detail given Azerbaijan's clear determination to keep control of the route. Turkey owns just 20% in the project via BOTAS and TPAO, while the State Oil Company of Azerbaijan (Socar) holds the rest. Socar has staunchly refused to allow Ankara a larger stake, and has snubbed Turkish moves towards discussing TANAP capacity with other Caspian producers such as Turkmenistan.
Turning to the pipeline across his own country, Yildiz said that concrete steps, such as creating a legal framework and launching the land works, will be taken this year. A Socar official meanwhile said work has been completed on the agreement on technical cooperation, but the work on other documents, particularly, the negotiations with partners, which will be included in the project, is still underway.
He added that no date is yet defined for distribution of shares in the project. Socar is understood to be open to reducing its stake to 51% to allow its partners in the Shah Deniz consortium to buy in. According to reports, a 29% stake will be split to give Statoil and BP 12% each, with Total to have 5%.
The Shah Deniz partners have also arranged potential stakes in both TAP and Nabucco West. NIC CEO Reinhard Mitschek, told journalists in Baku on April 8 that the company offered a full 50% in Nabucco to the Shah Deniz consortium in March.
Nabucco West - a shortened version of the earlier grand Nabucco scheme - owned by Bulgarian Energy Holding, Romanian Transgaz, Turkish Botas, Austrian OMV, Germany's RWE and Hungary's FGSZ, would carry the gas to Austria. TAP would route the gas via Greece and Albania and across the Adriatic Sea to Italy. The shareholders are AXPO of Switzerland (42.5%), Norway's Statoil (42.5%) and E.ON Ruhrgas of Germany (15%).
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