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More stakes but no discount for Greece (Update)

17 February 2015 13:45 (UTC+04:00)
More stakes but no discount for Greece (Update)

By Gulgiz Dadashova

Azerbaijan’s state energy giant SOCAR is ready to sell some part of its shares in the Trans Adriatic Pipeline to the Greek side.

SOCAR Vice-President Elshad Nasirov told reporters on February 16, noting that the company is open to such proposal.

"If Greece wants to buy any share, we are ready to sell it,” Trend reports citing the company official. “But the main requirement for the Greek side is that it must settle the account on time. If there is such a company, SOCAR is ready to resell some shares. We want this pipeline to be more "Greek". Our wishes coincide. Another thing is to find a solvent company not to delay the construction of the pipeline and the Southern Gas Corridor project implementation.”

The Trans-Adriatic Pipeline, planned to stretch from Greece via Albania and the Adriatic Sea to Italy, is the core part of the Southern Gas Corridor designed to bring the natural gas to Europe from the Shah Deniz offshore gas field in Azerbaijan.

TAP’s shareholding is comprised of BP (20 percent), SOCAR (20 percent), Statoil (20 percent), Fluxys (19 percent), Enagás (16 percent) and Axpo (five percent). Construction of TAP is planned to begin in 2016. The first volume of gas from the Shah Deniz-2 is expected to reach the European market in 2019.

Speaking about possible discount in gas price for Greece, the official said currently, it is impossible to reduce for Greece the price of Azerbaijan’s gas to be purchased and delivered to that country via the TAP.

Nasirov said first of all, such a decline in prices doesn’t correspond to international practice. “A contract was signed with Greece for 25 years. According to contract, there are provisions about possibility of negotiations regarding change of purchase and sale price of gas. This can happen when sharp changes are observed in the market. However, this can be after gas supply. As Greek side does not buy gas yet, any price change is out of question”, Nasirov said.

SOCAR’s senior representative also said the reduction in purchase prices depends neither on the Greek side nor on Azerbaijani, AzerTag state news agency reports.

“The price contract has been signed by Greece and a consortium including 7 companies to supply Greece with gas. Related mechanism has been prepared by Greek side and a group to supply gas and conduct negotiations. This group stopped operation after signing contract. Therefore, there are no sides to conduct negotiations on reduction of gas price,” he said.

Talking about Greece’s demand to raise the tariffs for transit of Azerbaijani gas through its territory, he said this issue should be addressed at the EU level.

Earlier, Greek Energy Minister Panagiotis Lafazanis said the government supports the construction of TAP, but believes that the benefit, which the country can get from the natural gas transit through its territory, is not sufficient

In exchange for all of these conditions, SOCAR demands Greek side to do payments timely and not to delay construction of the pipeline, Nasirov said.

He further added that SOCAR is regularly contacting with the new Greek government: “If Greek economy will develop with more intensive temps than TAP existence, we are ready to provide any support to this project”.

SOCAR is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in the domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan.

The company annually invests billions of dollars in transport infrastructure and is involved in key projects designed to increase Europe's energy security.

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Follow Gulgiz Dadashova on Twitter: @GulgizD

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