Gas from Azerbaijan – decision postponed

The decision was to be made in December: Several Pipeline projects and companies are competing for the gas from Shah Deniz 2 in the Caspian Sea. All offers have been turned in December. But the decision that was to be made this month, will be postponed – until April, Socar – the state-owned gas and oil company –  announced, not saying why only so late.

Until 2006 Azerbaijan had to import gas, most of it from Russia. Only in 2007 Socar started to export – and started to earn a lot of money. The small country has a strategically good position in the middle of several countries that need gas. A strategic partnership with Georgia offers the chance to deliver gas via the Caucasus and Turkey to Europe – and thereby strengthening contacts to European structures and economies.

Now all projects  are waiting for a decision: Nabucco, connecting existing pipelines to Europe, IGTI, a 185-mile pipeline that would pump gas to Greece and Italy, and TAP (Trans Atlantic Pipeline). The TAP consortium, which includes Statoil and E.ON, proposing the shortest and cheapest pipeline, at €1.1bn, linking Greece and Italy, with the option of building more connections into the former Yugoslavia. Both would have about one-third of Nabucco’s capacity.

The reason for the delayed decision has not been announced. It could be political trouble, although that is unlikely to happen, it could be the link to gas-wealthy Turkmenistan, that is not clear yet because Moscow and Iran are blocking it, or it could be technical problems. Nothing has been said from Baku, but that there will be a decision made in April.

Only  one thing is very clear: Europe and especially Germany will need much for gas in addition to their windmills and other renewable energies.

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