Secured financing for TANAP to hit $3.7B
By Nigar Abbasova
The volume of secured external financing for the Trans Anatolian Natural Gas Pipeline project, a core pipe forming the Southern Gas Corridor, stands at $2.15 billion, while, in perspective, the amount can reach some $3.7 billion.
Three separate financing projects for TANAP, which is 65 percent complete, has already been approved, Anadolu Agency reported referring to the international financial organizations.
In late 2016, the World Bank (WB) approved allocation of $800 million to Azerbaijan and Turkey. The recipients of funding are the Southern Gas Corridor (SGC) Closed Joint Stock Company with the guarantee of Azerbaijan and the Boru Hatları İle Petrol Taşıma Anonim Şirketi (BOTAŞ) with the guarantee of Turkey.
Moreover, the Asian Infrastructure Investment Bank (AIIB) approved allocation of $600 million for the SGC, while a guarantee of allocation of $750 million for the project has already been provided by the Multilateral Investment Guarantee Agency (MIGA).
Nearly €1 billion from the European Investment Bank (EIB) will be provided to BOTAS under the guarantee of the Undersecretariat of the Treasury.
Besides, additional financing of approximately $1.5 billion from the European Bank for Reconstruction and Development (EBRD) is expected to be approved for the project.
TANAP project, worth $8.5 billion, envisages transportation of gas from Azerbaijan’s Shah Deniz field to the western borders of Turkey. The gas will be delivered to Turkey in 2018, and after completion of the Trans Adriatic Pipeline’s construction, the gas will be delivered to Europe in early 2020.
The length of TANAP is 1,800 kilometers with the initial capacity standing at 16 billion cubic meters. Some 6 bcm of gas will be delivered to Turkey, while the remaining volume will be supplied to Europe. The construction work within the project is currently on track.
The overall objective of the TANAP project is to diversify Azerbaijan’s gas export markets and improve energy security in Turkey and South East Europe.
The capacity of the project will be increased up to 30 bcm in parallel with the development of the gas fields in Azerbaijan.
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Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova
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