Azernews.Az

By Gulgiz Dadashova

The EU regulators have confirmed an agreement between Greece and the Trans-Adriatic Pipeline (TAP) that will bring gas from Azerbaijan to Europe, saying the project was in line with the bloc's state aid rules.

The 870-km TAP, part of the Southern Gas Corridor that will link Azerbaijan's giant Shah Deniz II field with Italy, crossing through Georgia, Turkey, Greece, Albania and the Adriatic Sea, is the largest project to bring new gas supplies to European consumers.

"The Trans-Adriatic Pipeline will bring new gas to the EU and increase the security of energy supply for Southeast Europe," European Competition Commissioner Margrethe Vestager said in a statement released on March 3.

"The investment incentives offered by the Greek government are limited to what is necessary to make the project happen and in compliance with state aid rules."

The Greek Ministry of Energy, Environment and Climate Change (MEECC) and the Greek Ministry of Finance on the one hand and TAP on the other hand signed the HGA in Athens, in June 2013.

As part of the approved deal, TAP will be granted a specific tax regime for 25 years. TAP is owned by BP, Azeri state energy firm SOCAR, Snam, Belgian company Fluxys, Italy's Enagas and Axpo.

Around 10 billion cubic metres a year Shah Deniz gas should reach Europe by 2020 at the latest through TAP as well as the South Caucasus Pipeline through Georgia and the Trans-Anatolian Pipeline (TANAP) through Turkey.

Vice-President responsible for Energy Union Maroš Šefčovič assessed the Greek deal’s approval as an important step towards completing the Southern Gas Corridor.

"Today's approval of the TAP agreement is The Energy Union framework strategy of February 2015 identified this project as a key contribution to the EU's energy security, bringing new routes and sources of gas to Europe,” he said.

The EU offers strong political support for the Southern Gas Corridor project, as it sees it as an alternative to gas imports from Russia. The European regulator believes competition on its gas market will be increased thanks to the extra volumes of gas and new supply route.

Although, the contracted volumes of gas to be transported via this route are still small, in later stage energy exporters from the Middle East and Central Asia may join the Southern Gas Corridor.

Currently, the key aim is to proceed with the successful implementation of the long-planned Shah Deniz II gas field development and the TANAP/TAP pipeline projects to bring Azerbaijani gas to Turkey and Europe in accordance with the schedule.

--

Follow us on Twitter @AzerNewsAz