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Commissioner Oettinger: Southern Gas Corridor is game changer for EU

19 February 2019 10:00 (UTC+04:00)
Commissioner Oettinger: Southern Gas Corridor is game changer for EU

By Leman Mammadova

EU supports the energy projects implemented in South Caucasus and interested in supplying Caspian hydrocarbon resources to Europe, as it comprehends diversification of the sources necessary to ensure Europe's energy security.

The Southern Gas Corridor is a game changer for the European Union since it will deliver by 2020 for the first time gas coming from the Caspian Sea, the European Commissioner for Budget and Human Resources Günther Oettinger said in an interview with Trend.

"In this sense, the project will open a new supply route and helps the EU to diversify its gas sources in line with the EU Energy Security and Energy Union Strategies," he said.

The EU commissioner pointed out that the current capacity of the Southern Gas Corridor can technically still be expanded in future, which would allow the EU to still receive additional gas from the Caspian region.

Oettinger further added that he sees the future of energy cooperation between Azerbaijan and the EU very positive.

"The Southern Gas Corridor links Azerbaijan and the EU closely together. Azerbaijan and the EU have already agreed on so-called Partnership Priorities. These priorities constitute an action program we want to implement jointly over the coming years. This list also includes energy cooperation," he said.

“In addition, the EU is currently negotiating with Azerbaijan a so-called ‘enhanced Agreement’. This international agreement will put our joint relations, including on energy, on a new, solid and modern footing,” added Oettinger.

The commissioner said Azerbaijan plays a lead role in the Southern Gas Corridor and the state-owned company SOCAR is very active both in this project, but also beyond.

"Due to its investments in the EU, the Western Balkans, and Turkey, SOCAR has a vocation to play an important role in the EU’s and neighboring energy markets in future. The EU markets are always open to foreign investment and competition in line with the EU’s regulatory framework," Oettinger concluded.

Azerbaijan’s Southern Gas Corridor closed joint stock company (CJSC) plans to invest around $ 900 million in the relevant segments of the Southern Gas Corridor in 2019. The Southern Gas Corridor CJSC has invested a total of $9.6 billion in the projects as of 2018.

The Southern Gas Corridor is one of the priority projects for the EU and envisages the transportation of 10 billion cubic meters of Azerbaijani gas from the Caspian region through Georgia and Turkey to Europe.

Perhaps this is one of the most ambitious projects in the world of oil and gas industry, as well as a complex target that involves a large number of different stakeholders - including seven governments and 11 companies.

At the initial stage, the gas to be produced as part of the Stage 2 of development of Azerbaijan's Shah Deniz field is considered as the main source for the Southern Gas Corridor projects. Other sources can also connect to this project at a later stage.

The Southern Gas Corridor consists of four projects: Shah Deniz 2, Expansion of South Caucasus Pipeline (Baku-Tbilisi-Erzurum), the Trans Anatolian Pipeline (TANAP) and Trans Adriatic Pipeline (TAP).

The launching ceremony of the first stage of the Southern Gas Corridor was held in Baku on May 29, 2018, while opening ceremony of TANAP was held on June 12, 2018 in the Turkish city of Eskisehir.

Thus, the first gas from the Azerbaijani Shah Deniz field has already gone through the first segment of the Southern Gas Corridor - from the Sangachal terminal to the expanded South Caucasus Pipeline.

Recently, TAP and TANAP successfully completed their connection on the banks of the Merich River on the Turkish-Greek border.

Energy Ministry recently revealed the current execution state of the implementation of the Southern Gas Corridor (SGC) projects. According to the information, at the end of 2018, 100 percent of the total gas production work on the Shah Deniz-2 project, 92.3 percent of the work on full-scale development, 99.8 percent of the work on the South Caucasus Pipeline Expansion project, 98.8 percent of the construction works of TANAP and 82.4 percent of TAP pipeline construction works were implemented.

The EU and the U.S. who are not satisfied with the Russian monopoly in the European energy market, are interested in the delivery of Caspian gas to Europe via the Southern Gas Corridor.

TAP will be the first non-Russian gas pipeline to supply Europe since the Medgaz link, which started deliveries from Algeria to Spain in 2011.

The TAP project is one of the strategic objectives of the EU in the energy security and diversification of energy sources, chosen as the shortest and direct way to export natural gas from Azerbaijan to the European markets.


Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888

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