Azerbaijan and Turkey yet to reach gas supply deal: energy exec
Azerbaijan and Turkey have reached agreement on some
issues in gas supply talks but the package on the negotiating table
has not been fully agreed, Rovnag Abdullayev, the president of
Azerbaijan’s state energy firm SOCAR, has said.
The package being discussed includes the price of gas produced from the first and second stages of the project on developing Azerbaijan's Shahdaniz field, as well as the volume of gas transit and its conditions.
Abdullayev said it was premature to say the two countries have finalized an agreement "until the last issue has been agreed upon." Once the package is approved, it will be in force for 30 years, and it contains up to 100 questions.
"We are negotiating in the form of a package in which about ten issues have been raised. Several of them have been resolved, but there is no overall agreement so far."
The SOCAR president said Azerbaijan is currently selling gas to Turkey for a price of $120. "But we reserve the right to recalculate it for the past years. However, it is unknown [at this point] how much this price will be and when it will be received."
According to the gas supply contract concluded by Shahdaniz partners with Turkey, the price of Azerbaijani gas may be reconsidered a year after the start of gas deliveries, i.e. the new price is effective from April 15, 2008. Under the agreement, Turkey is to import up to 6.6 billion cubic meters of gas during Phase 1 of Shahdaniz development.
US Special Envoy on Eurasian Energy, Richard Morningstar, recently said "significant further delays" in reaching an Azerbaijan-Turkey gas agreement "could see the window of opportunity for putting in place this key piece of a Southern Corridor close."
The Shahdaniz field in the Caspian Sea holds estimated reserves of 1.2 trillion cubic meters.
The Shahdaniz field, operated by an international consortium, launched production in 2006. It has the capacity to produce 318 billion feet of gas from its initial phase, with another 706 billion cubic feet expected from Phase 2, which is to begin in 2013. During the second stage of the project, Azerbaijan plans to export its gas to Europe.*
The package being discussed includes the price of gas produced from the first and second stages of the project on developing Azerbaijan's Shahdaniz field, as well as the volume of gas transit and its conditions.
Abdullayev said it was premature to say the two countries have finalized an agreement "until the last issue has been agreed upon." Once the package is approved, it will be in force for 30 years, and it contains up to 100 questions.
"We are negotiating in the form of a package in which about ten issues have been raised. Several of them have been resolved, but there is no overall agreement so far."
The SOCAR president said Azerbaijan is currently selling gas to Turkey for a price of $120. "But we reserve the right to recalculate it for the past years. However, it is unknown [at this point] how much this price will be and when it will be received."
According to the gas supply contract concluded by Shahdaniz partners with Turkey, the price of Azerbaijani gas may be reconsidered a year after the start of gas deliveries, i.e. the new price is effective from April 15, 2008. Under the agreement, Turkey is to import up to 6.6 billion cubic meters of gas during Phase 1 of Shahdaniz development.
US Special Envoy on Eurasian Energy, Richard Morningstar, recently said "significant further delays" in reaching an Azerbaijan-Turkey gas agreement "could see the window of opportunity for putting in place this key piece of a Southern Corridor close."
The Shahdaniz field in the Caspian Sea holds estimated reserves of 1.2 trillion cubic meters.
The Shahdaniz field, operated by an international consortium, launched production in 2006. It has the capacity to produce 318 billion feet of gas from its initial phase, with another 706 billion cubic feet expected from Phase 2, which is to begin in 2013. During the second stage of the project, Azerbaijan plans to export its gas to Europe.*
Here we are to serve you with news right now. It does not cost much, but worth your attention.
Choose to support open, independent, quality journalism and subscribe on a monthly basis.
By subscribing to our online newspaper, you can have full digital access to all news, analysis, and much more.
Subscribe
You can also follow AzerNEWS on Twitter @AzerNewsAz or Facebook @AzerNewsNewspaper
Thank you!