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TAP to Deliver Greece, Italy and CESEE

Published: July 1, 2013; 12:28 · (Vindobona)

Shah Deniz targets Italian and Southeastern European gas markets through Trans Adriatic Pipeline.

TAP to Deliver Greece, Italy and CESEE / Picture: © Vindobona.org

The Shah Deniz consortium announced today that it has

selected the Trans Adriatic Pipeline (TAP) to deliver gas volumes

from the Shah Deniz stage 2 project to customers in Greece, Italy and

Southeast Europe.

This is an important milestone in the Shah Deniz consortium's

multi-phased approach to the opening of the Southern Corridor.

Initially the Southern Corridor will deliver up to 10 billion cubic

metres a year (BCMA) of Shah Deniz natural gas to European markets.

Today's decision is also an important step in the consortium's

plans for a final investment decision on Shah Deniz 2. This project,

with its associated pipelines, will cost over $40 billion and will

bring over 16 billion cubic metres a year (BCMA) of Azerbaijani gas

to market.

"We are delighted that Azerbaijani gas will be transported to

Europe, enabling the implementation of the Southern Gas Corridor.

This will be made possible through development of the South Caucasus

Pipeline Expansion, Trans Anatolian Pipeline and Trans Adriatic

Pipeline," stated Rovnag Abdullayev, President of SOCAR.

"We are also pleased that the Shah Deniz Consortium has plans to

work with European interconnector projects to deliver gas to multiple

countries across Southeast Europe. We look forward to the

co-venturers making their final investment decision on the Shah Deniz

stage 2 project later this year."

"Beyond Shah Deniz, we are confident that Azerbaijan's gas exports

will increase dramatically as fields like ACG Deep, Absheron, Umid

and Shafag-Asiman are developed, and we see the pipeline route

towards Austria as a natural market for this gas. The development

planning of both pipeline routes lays the foundation for future

growth and we appreciate the support of the European Commission

throughout this process," Abdullayev added.

"Choosing Italian and Southeast European markets for delivery of

gas from Shah Deniz stage two is a major step forward for the

development of our project," said Gordon Birrell, Regional President

for BP in Azerbaijan, Georgia and Turkey.

"We are very pleased that the comprehensive and very competitive

pipeline selection process has concluded, so that we can move forward

with the Southern Gas Corridor. This will bring gas from the Caspian

Sea directly to Europe for the first time. We would like to take this

opportunity to thank both the Nabucco West and TAP teams for the high

quality of their offers and for the outstanding cooperation that they

have offered to the Shah Deniz consortium," Birrell said.

The selection of TAP to complete the first phase of the Southern

Corridor followed an intensive evaluation period during which experts

from the Shah Deniz consortium evaluated the alternative export

routes using their previously announced selection criteria, namely:

commerciality, project deliverability, financial deliverability,

engineering design, alignment and transparency, safe and efficient

operability, scalability and public policy considerations.

The Shah Deniz consortium has agreed terms with a number of

companies in Italy and Greece for its gas sales. In addition,

negotiations are underway to make gas sales in Bulgaria, and Shah

Deniz plans to make an expression of interest to take pipeline

capacity to that country.

Furthermore, Shah Deniz supports the inter-governmental memorandum

of understanding of 23 May 2013 supporting the realisation of TAP and

the Ionian-Adriatic Pipeline (IAP), signed by Croatia, Montenegro,

Bosnia & Herzegovina and Albania and recognised by the Adriatic and

Ionic Council on 27 May 2013.

The next stage is for Shah Deniz consortium members to make a

final investment decision on the full Shah Deniz stage two