Azernews.Az

Hungarian oil and gas company MOL said there were many uncertainties over the Nabucco pipeline aimed at shipping Caspian natural gas to Europe, adding to questions about the future of the costly strategic project, Reuters reported.

The comments come after Germany`s RWE AG, another Nabucco partner, said in January it might review its participation in the pipeline and could join other projects instead.

MOL said its concern stemmed from the rising costs of the project aimed at diversifying supplies away from Russia and whether there will be enough gas to fill the pipeline.

There are many uncertainties around the Nabucco project that would be hard to ignore, MOL said in an e-mail statement. Both the financing background and the gas source are uncertain.

A Nabucco spokesman said the project was progressing well and there were no indications MOL would pull out.

The Nabucco shareholder in Hungary is FGSZ, a MOL subsidiary, and we have not had any indication that this will change, spokesman Christian Dolezal said in a statement. The negotiations between the Nabucco shareholders and the Shah Deniz II Consortium for gas supply are progressing.

The 4,000 km, 31 billion cubic metre (bcm) capacity pipeline, a pet project of the European Union as it aims to reduce dependence on Russian gas supplies, has so far failed to sign any gas supply deals.

Its critics have long said its cost - estimated at over $12 billion - was too high and it would struggle to find enough gas to fill it with non-Russian supplies.

For the foreseeable future, the only substantial non-Russian gas supplies from central Asia will come from Azerbaijan, where producers in the Shah Deniz II field, led by BP and Statoil, plan to ship around 16 bcm a year through Turkey into Europe from 2017 or 2018.

Marlene Holzner, spokesperson for the EU Energy Commissioner, said in Brussels that the fate of the Nabucco pipeline and other Southern Gas Corridor transportation systems depends on the decision of Azerbaijan, a gas supplier.

Commenting on MOL company`s turning down participation in the Nabucco project, Holzner noted that Azerbaijan is expected in the coming months to select the pipeline for gas export to Europe. Nabucco is one of the options, she said, adding that negotiations on the issue were underway.

Nabucco, as well as South-East Europe Pipeline (SEEP) and Trans Adriatic Pipeline (TAP), are considered by the consortium tapping Shah Deniz gas field to export gas to European markets.

According to Holzner, one of the EU`s priorities is to gain access to Azerbaijan`s energy resources in the Caspian region.