SOCAR to expand its activities in Balkans
By Fatma Babayeva
Azerbaijan’s state owned energy company SOCAR seeks to expand its presence in Balkans.
The company decided to intensify its activities in Balkan Peninsula via its subsidiary SOCAR Balkan in order to explore cooperation opportunities with the countries of this Peninsula, a source at the company told Trend.
The source stressed that the company’s utmost concern is about boosting energy security in the western Balkan region. “Countries located in this region are not EU members. However, these countries’ lack of capacity to ensure their own energy security impacts the EU,” said the source by reminding that in the joint declaration on Southern Gas Corridor signed in 2011 between the EU and Azerbaijan, the priority was given to the countries of South-Eastern Europe as they can ensure their own energy security to a lesser extent, and Baku traditionally has had good mutual relations with them.
The source further added that SOCAR’s activation of works in this direction is not a surprise. “Croatia and Montenegro was invited to the second ministerial meeting of the Advisory Body for Southern Gas Corridor held in Baku in February 2016. The final document reads that works will be carried out to assist new gas infrastructures of these countries, especially Ionian Adriatic pipeline (IAP) was mentioned in the document.”
Currently, the company bilaterally cooperates with Albania and Montenegro and provides assistance in improving their gas infrastructures, said the source, reminding that these countries are the participants of IAP project, and SOCAR sees great opportunities for cooperation.
“These two independent processes- bilateral contribution to the development of the gas market and infrastructure projects- can be combined in a package, and a special permanent operational subdivision will be established soon and immediately begin developing the road map,” said the source, further adding that SOCAR will work together with the European Commission on remaining opportunities within the framework of the special fund under the EC providing assistance to Balkan states.
The source excluded problems over SOCAR’s compliance with the Third Energy Package (TEP). “Balkan states are the members of the energy community, and they are required to integrate to the legal system of the EC on energy development through a relevant program.
As SOCAR only provides technical assistance and will not become a direct participant of the IAP pipeline, at least for now, issues about compliance with the TEP will not arise, “ the source explained, emphasizing that SOCAR only shares its experience.
SOCAR Balkan was established two years ago, its headquarters is located in Baku. The subsidiary is the founder of SOCAR Greece as well.
As the opportunities for cooperation with Balkan countries in the energy sector keep increasing, SOCAR decided to intensify its activities in the region. However, the company has been actually working with these states long ago, said the source.
The envisaged IAP will be constructed through the Western Balkans and provide natural gas to the South-Eastern European states. It will be connected to the TAP pipeline, which is part of the ongoing Southern Gas Corridor project. Upon completion, the pipeline network will provide more than 10 billion cubic meters- expandable to 20 billion cubic meters in future- to the EU through via Georgia and Turkey.
The main source at the initial stage will be Shah Deniz Phase 2- a gas field located in the Azerbaijan’s section of the Caspian Sea. Nevertheless, other sources can be connected to the SGC in future as well.
Worth noting, the groundbreaking ceremony of TAP will take place on May 17 in Greece.
In addition, TAP has already signed memoranda of understanding and cooperation with the developers of the IAP project, namely with Plinacro (Croatia), BH-Gas (Bosnia and Herzegovina), Geoplin Plinovodi (Slovenia), as well as, with the governments of Montenegro and Albania.
A working group for TAP and IAP has been established. The group meets regularly to synchronize the timing of both projects and to coordinate technical issues related to their connection.
In the meantime, possible timeframe for the realization of this project is not disclosed.
In addition, Bulgaria also has intention to be connected to the TAP pipeline via the Interconnector Greece-Bulgaria (IGB).
First gas delivery to Georgia and Turkey via SGC is scheduled for late 2018. However, gas deliveries to Europe are expected a year after the first gas is produced in offshore fields of Azerbaijan.
The SGC, a win-win project for all parties, is one of the biggest construction projects of our times with a value of $45 billion.
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Fatma Babayeva is AzerNews’ staff journalist, follow her on Twitter: @Fatma_Babayeva
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