Azernews.Az

BAKU – Azerbaijan and Greece signed a deal on Tuesday on direct gas supplies from the South Caucasus republic, bypassing Turkish intermediaries.

Azerbaijan - a potential key gas supplier of the European-backed Nabucco pipeline project - has made it a policy to diversify gas sales, to avoid dependence on any one intermediary such as Turkey or Russia.

The volume was not specified, but Azerbaijan said in February it planned to sell 0.7 billion cubic meters directly to Greece, which had been buying the same volume from Turkey since the end of 2008 as part of a re-export scheme.

"Azerbaijan is interested in boosting gas supplies to Greece and wants to use its transit possibilities in the future," Reuters quoted Azerbaijani President Ilham Aliyev as saying after talks with his Greek counterpart Karlos Papoulias in the Azerbaijani capital, Baku.

The document was signed by Azerbaijani state energy company Socar and the Greek company Depa.

"This document ... will be a serious incentive for Azerbaijan's co-operation with other European countries, as Azerbaijan will be doing its best to ensure the energy security of Europe," Aliyev said.

President Papoulias in turn said his country was interested in importing gas from resource-rich Azerbaijan.

It remains unclear when Azerbaijan will start direct supplies. Details of the memorandum were not disclosed.

Azerbaijan's gas output rose by 11.2% in 2010 year-on-year to 26.2 Bcm from 23.6 Bcm in 2009.

It plans to produce 28 Bcm of gas this year, including 9.1 Bcm at its major Shahdaniz field in the Caspian Sea.

Shahdaniz, co-led by BP and Statoil, is estimated to contain 1.2 trillion cubic meters of gas.

Production at the deposit began in 2006, while second phase production is expected to begin by late 2016 or early 2017.

Azerbaijan's total gas reserves are estimated at 3 Tcm to 5 Tcm.

It sells gas to the domestic market, neighboring Georgia and Turkey via the Baku-Tbilisi-Erzurum pipeline, as well as Russia.

Three more agreementsAzerbaijan and Greece signed three more documents after talks between their leaders, including agreements on cooperation in environmental protection and on maritime transport as well as a three-year program on science, education and culture.

President Aliyev said there were good prospects for developing bilateral relations. Aliyev said that the two countries share a number of economic interests, adding that the joint business forum due in Baku on Wednesday was an opportunity for Azerbaijani and Greek businesspeople to forge ties.

President Papoulias said the Armenia-Azerbaijan conflict over Nagorno Karabakh was among the issues discussed in Baku, stressing the importance of resolving the long-standing dispute peacefully and with the OSCE Minsk Group’s mediation. "We hope that a solution will be found soon," he added.

Papoulias said further that Greece was focused on the European Union’s Eastern Partnership program, which aims to boost the 27-member bloc’s cooperation with its ex-Soviet partners.

"In this context, we support launching talks between Azerbaijan and the EU on the signing of an association agreement. I assured President Aliyev that Azerbaijan could rely on Greece’s support on this issue."

The Greek leader, who is accompanied by a delegation of officials and a group of businessmen, will wrap up his visit to Baku on Wednesday.